Comprehensive overhaul of Civil Transactions Law expands legal capacity, strengthens buyer protections, and clarifies asset rules for expatriates.
DUBAI — In a landmark legislative shift, the United Arab Emirates is set to implement a new Civil Transactions Law on June 1, 2026, officially lowering the age of majority from 21 to 18. Federal Decree-Law No. 25 of 2025, which was published in the Official Gazette late last year, marks a significant turning point in the country’s legal framework, granting young adults full legal capacity to manage their own financial and civil affairs.
The reform aligns the Civil Transactions Law with recent updates in other sectors. Legal experts note that the change follows the precedent set by the new UAE Traffic Law, which reduced the driving age to 17, and the Commercial Transaction Law, which lowered the threshold for engaging in trade to 18.
Key Changes to Legal Capacity and Asset Management
The core of the amendment lies in Article 84, which stipulates that any individual who has reached 18 Gregorian years, possesses full mental capacity, and has not been interdicted shall enjoy full legal rights.
Beyond the age of majority, the law introduces provisions for even younger individuals. Minors as young as 15 may now be granted court approval to manage personal or inherited assets under specific judicial oversight. This move is designed to foster financial autonomy while maintaining structured safeguards to prevent exploitation.
Protection for Buyers and New Contractual Obligations
The reforms also aim to modernize the business landscape by introducing stricter transparency requirements and enhanced buyer protections:
- Pre-contractual Disclosure: New obligations may require parties to disclose vital information during negotiations, shifting the legal focus toward transparency before a contract is even signed.
- Latent Defects: The limitation period for defect-related claims is expected to be extended, providing buyers with a longer window to seek recourse for hidden issues in purchased goods or property.
- Contract Registration: There is a growing emphasis on formal registration as a condition for legal validity, similar to existing systems like Ejari for tenancies or Dubai Land Department registrations for property sales.
Expat Assets and Inheritance
For the UAE’s vast expatriate population, the law provides much-needed clarity on the handling of assets in the event of death without a will or legal heirs. Under the reported provisions, if no heir claims the financial assets, the funds will be placed into a charitable endowment under official state oversight. This ensures that dormant assets are managed ethically and directed toward social good rather than simply reverting to the state without clear protocols.
Enhanced Compensation for Injury and Fatality
In a significant move for the judiciary, the updated law allows for compensation beyond traditional “blood money” (Diya) in cases of death or serious injury. Courts will now have the flexibility to award additional damages where material or moral harm is not fully addressed by existing mechanisms, ensuring more comprehensive justice for victims and their families.
