His Royal Highness Prince Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince and Prime Minister - may God protect him - chaired the Cabinet meeting held today in Riyadh.
According to the Saudi Press Agency (SPA), the Council reviewed a number of performance indicators of the government work system and the progress it has made in the areas of management, governance and institutional excellence, praising in this context the Ministry of Human Resources and Social Development for obtaining a global award from the International Institute of Project Management, thus surpassing 53 entities from 28 countries, for its contribution to enhancing the effectiveness of implementing initiatives, achieving targets and aligning them with national priorities.
During the session, the Cabinet approved the Commercial Transactions System and a memorandum of understanding in the municipal and housing sectors between the Ministry of Municipalities and Housing in the Kingdom of Saudi Arabia and the Ministry of Public Works and Housing in the Syrian Arab Republic. The Cabinet also approved the restructuring of the Board of Directors of the National Water Company, headed by His Excellency Engineer Abdulrahman bin Abdulmohsen Al-Fadhli.
For his part, Dr. Majid Al-Qasabi, Minister of Commerce, affirmed that the Commercial Transactions Law, approved by the Cabinet today, regulates the provisions of commercial contracts, including commercial sales, supply sales, brokerage, and commercial agency. Al-Qasabi added that the law allows young men and women to engage in commerce upon reaching the age of 15, subject to specific regulations, and complements the Civil Transactions Law to stimulate the commercial and investment environment.
The Ministry of Commerce explained in a statement that the Commercial Transactions System is a comprehensive framework that regulates the provisions of business and store activities and related business, obligations, contracts and commercial papers, and keeps pace with best international practices.
She added that the system contains (271 articles), which include provisions that define the nature of commercial activities, the merchant and the store, the obligations of merchants, accounting records, commercial contracts, and provisions for commercial papers (bills of exchange, promissory notes and checks), and it replaces three systems, namely: “the Commercial System, the Commercial Papers System, the Commercial Books System.”
The system allowed the minor “upon reaching the age of 15” to engage in trade “with the permission of his guardian or custodian or the court,” and redefined the merchant, specifying commercial activities and what constitutes a commercial activity if practiced once, and what requires professionalization to be considered a commercial activity.
The system promotes and encourages legitimate competition among merchants, prevents a merchant from harming a competitor, and clarifies the rights of the affected party to resort to the court to request a halt to the harm and to claim compensation.
It exempted some categories of merchants from keeping accounting records, and gave special attention to preserving them electronically or on paper “in Arabic” using technological means, and allowed the option to preserve them in another language. The system also increases the ability to predict rulings in commercial transactions and reduce disputes.
The system addressed commercial contracts, and for the first time, it codified, in a single legislative document, the provisions governing commercial sales, supply sales, commercial agency, and brokerage, clearly outlining the protections afforded to all rights. The Commercial Transactions Law, which comes into effect 180 days after its publication in the Official Gazette, provides protection for the transactions of merchants and small and medium-sized enterprises (SMEs), and facilitates their expansion through the conclusion of commercial contracts and agency agreements.
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