The law takes effect next month, overhauling age limits and expat asset rules
From June 1, the UAE will implement a new Civil Transactions Law, introducing significant updates to areas such as legal capacity, contracts, civil dealings, and the management of accounts held under guardianship.
Federal Decree-Law No. 25 of 2025 was issued and published in the Official Gazette in October 2025. One of the key changes under the law is the reduction of the age of majority from 21 to 18, granting full legal capacity once an individual reaches 18.
According to the UAE legislation platform, the law is designed to strengthen individuals’ rights to manage their own legal and financial affairs, while ensuring safeguards remain in place to prevent exploitation or harm.
Legal adulthood lowered to 18 instead of 21
One of the most notable changes is the reduction of the age of majority from 21 to 18. This means individuals will be considered fully legally capable at 18, rather than 21.
Ludmila Yamalova, Founder and Managing Partner of HPL Yamalova & Plewka FZCO Legal Consultancy, said the amendment aligns with recent legal developments across the UAE.
“By way of example, the UAE’s Traffic Law reduced the minimum driving age to 17, while the Commercial Transaction Law lowered the age threshold for engaging in trade from 21 to 18. This approach is further reflected in recent banking practices, where individuals aged 18 are generally permitted to open bank accounts independently,” she said.
Article (84)
1. Every person who has reached the age of majority, enjoying full mental capacity, and has not been interdicted shall have full legal capacity to exercise their civil rights.
2. A person reaches the age of majority upon completing eighteen (18) Gregorian years.
By way of example, the new UAE Traffic Law reduced the minimum driving age to 17, while the Commercial Transaction Law lowered the age threshold for engaging in trade from 21 to 18. This approach is further reflected in recent banking practices, where individuals aged 18 are generally permitted to open bank accounts independently.
Minors may manage assets earlier with court approval
Another reported amendment relates to the age at which minors can receive court approval to manage personal or inherited assets.
According to commentary on the new law, this age could be reduced from 18 to 15, subject to strict conditions and judicial oversight.
“The commentary suggests that the new law reduces this age to 15, subject to specified conditions and judicial oversight. If confirmed, this change would align with the UAE’s wider legislative direction of extending legal capacity earlier, albeit under structured safeguards,” Yamalova explained.
If implemented, this would allow younger individuals limited financial autonomy under court supervision.
Contract registration may become a legal requirement
Another major development under discussion is the possible introduction of contract registration as a condition for legal validity.
While full details are still awaited, Yamalova noted that registration requirements already exist for certain types of contracts in the UAE.
“By way of context, certain contracts in the UAE already require registration to be legally recognised or enforceable. Examples include tenancy contracts through Ejari, property sale and purchase agreements registered with the Dubai Land Department, and employment contracts registered with the relevant labour authorities,” she said.
What happens to expat assets in the UAE when there are no heirs
The new law may also introduce clearer rules on how a foreigner’s assets in the UAE are handled when they pass away without a will and without any legal heirs.
“Under the current framework, such assets may ultimately revert to the state. If confirmed, the new law may set out more detailed mechanisms, conditions and options for handling such cases,” Yamalova said.
“Potentially, directing certain assets towards charitable endowments may be included as alternative outcomes, subject to legal requirements.”
According to the reported provisions, where there is no will and no heir claims, financial assets in the UAE would be placed into a charitable endowment under official oversight to ensure proper management and allocation.
New rules for pre-contract negotiations and disclosure
Ahmed Odeh, Managing Partner at MIO & Partners, said public information suggests the law may introduce clearer obligations around pre-contractual conduct, particularly disclosure during negotiations.
“If implemented as described, this would mark a shift from the traditional focus on post-contractual liability, and could have practical implications for how negotiations are conducted, particularly in commercial transactions where information asymmetry exists,” he said.
It is understood that the limitation period for certain defect-related claims may be extended. If confirmed, this would represent a notable adjustment to the balance of rights and obligations between buyers and sellers.
Stronger buyer protections and clearer rules on defects
The amendments are also expected to refine rules governing sale contracts, including sales by sample or model, protection for individuals with limited legal capacity in real estate transactions, and updated provisions on latent defects.
“It is understood that the limitation period for certain defect-related claims may be extended. If confirmed, this would represent a notable adjustment to the balance of rights and obligations between buyers and sellers,” Odeh said.
Under the proposed changes, buyers may be able to reject defective goods, accept them with a price reduction, or request a defect-free replacement, offering clearer legal backing when goods or property fail to meet expectations.
Compensation beyond blood money in injury and death cases
Another reported change is the potential to award compensation beyond traditional blood money or assessed compensation in cases involving death or injury.
This would apply where material or moral harm is not fully addressed by existing compensation mechanisms.
“If applied as indicated, this would reflect a move towards fuller compensation in serious injury and fatality cases, addressing issues that have previously arisen in practice,” Odeh said.
Source: Gulf news
