The UAE replaced its civil code on 1 June 2026. Your website terms were drafted against the old one

On 1 June 2026 the United Arab Emirates replaced its civil code. Federal Decree-Law No. 25 of 2025, issued on 1 October 2025, repeals Federal Law No. 5 of 1985 outright and puts a new Civil Transactions Law in its place. Nothing in it is addressed to the internet — the word “electronic” appears twice in 354 pages, and “website”, “distance” and “consumer” not at all.

That absence is the finding. It is not a digital law, and it is the general law every online contract in the country already runs on — which was swapped out whole while nobody filed it under anything to do with their website.

Data Nexus read the instrument end to end. What follows is what a business that sells or contracts through a website has to do differently, cited by article. It is a reading of a published law, not legal advice, and the limits are stated near the end.

What this means if you are…

A small business with a website and a standard contract

Your terms of service are an adhesion contract as the law defines it (Article 118), and Article 223 lets a court modify or strike any condition in it that it finds unfair — and voids any clause you write to prevent that. The protective drafting most templates lean on no longer does the job it was there to do.

An agency, studio or development shop

Your contracts are Muqawala — the contract for work, Articles 812 to 839. Article 813 says such a contract shall state its subject matter, its nature and quantity, the method of performance, the completion period and the consideration. A retainer reading “marketing services, AED X per month” is missing four of the five things the statute expects to find.

An e-commerce or transactional platform

Article 127 decides whether your product page is an offer you are bound by or an invitation to negotiate you are not. Article 132 decides where and when the contract was formed, which is what determines the forum for a dispute. Both defer to your terms — but only if your terms say something.

What actually happened, and how to check it

The promulgating decree is three articles long. Article 1 brings the attached law into force. Article 2 repeals Federal Law No. 5 of 1985 “as amended” — the whole instrument, not selected parts. Article 3 sets commencement at 1 June 2026. It was issued at the Presidential Palace in Abu Dhabi on 9 Rabi’ Al-Akhir 1447, corresponding to 1 October 2025, which gave the country eight months of notice.

Article 4 of the new law confirms the ordinary rule: it runs from commencement and does not reach back over preceding facts and acts unless a provision says otherwise. So contracts concluded before 1 June 2026 were formed under the old law — but their performance, interpretation and enforcement from that date forward happen in a system where the instrument they were drafted against no longer exists.

Every article number below was read out of the official English text. Article numbers are the unit of verification here: if a claim in this piece is wrong, the article it cites is where it will be wrong, and it takes a minute to look up.

What you are now required to do

Say what your listing is

Article 127 contains two rules that pull against each other, and your own wording decides which one applies to you.

• 127(1) — an offer of goods or services accompanied by a statement of the consideration is deemed an offer, unless indications exist to the contrary. A product page with a price on it is, by default, a binding offer.

• 127(2) — publication, advertisement, statements of current prices and any other statement addressed to the public are, in case of doubt, an invitation to contract rather than an offer.

Those two reconcile only through “unless indications exist to the contrary” and “in case of doubt”. The indications are yours to supply, and the doubt is yours to remove. A page stating that listings are an invitation to treat and that the contract concludes when the seller issues confirmation settles it in advance. A page that says nothing leaves a mispriced item argued under 127(1), where the number on screen is an offer the buyer has already accepted.

State where and when a contract is formed

Article 132 splits on whether the parties are connected by direct means of communication. If they are, the contract concludes at the time and place the acceptance was issued — 132(1). If the parties are absent, it concludes at the time and place the offeror learned of the acceptance — 132(2). Both paragraphs end “unless the law or the agreement stipulates otherwise”.

No court has yet had to say whether a checkout flow is a direct means of communication or an exchange between absent parties, and the answer moves the place of formation. The clause that settles it is one sentence, and the statute expressly invites it.

Write a scope a statute would recognise

Where a contract for work is silent the law fills the gaps, and not in your favour. Article 818(1) supplies “recognized professional standards” and a “reasonable period”. Article 826 makes payment fall due on delivery. Article 830 sets an unstated price at the remuneration of the like. Each of those is a term decided by a court after the dispute has started.

What you can no longer do

Contract out of the unfair-terms review

Article 223 is the shortest consequential sentence in the law: where a contract is concluded by adhesion and contains unfair conditions, the court may modify them or release the adhering party from them as justice requires, “and any agreement to the contrary shall be void”. A clause in which the customer acknowledges the terms are fair, waives any challenge, or agrees they were individually negotiated is void by name. It is not weak drafting; it has no effect.

Rely on ambiguity

Article 120 keeps the general rule that doubt is read in favour of the debtor, then adds that ambiguous terms in an adhesion contract shall not be interpreted in a manner prejudicial to the adhering party. Vagueness in your own terms is now an asset belonging to the other side. The broad limitation-of-liability paragraph that survives by being hard to parse is being read against its author.

Treat silence as agreement

Article 128: silence is not acceptance, unless there was prior dealing between the parties on the same matter, or the offer was purely for the offeree’s benefit. “If we do not hear from you within seven days we will proceed and invoice” is not a mechanism the law supplies. Where a client has taken the same service repeatedly, prior dealing may carry it; on a first engagement it will not.

Bill for scope you were not authorised to add

Article 829 governs lump-sum work against an agreed design. Paragraph 1: no increase may be claimed even if materials, labour or other expenses rose. Paragraph 2: no increase for a modification or addition unless it is due to the employer’s fault, or made by their authorisation and the increase in consideration was agreed with the contractor. A change confirmed on a call and invoiced afterwards fails the second limb.

Paragraph 3 is the counterweight and worth knowing before you need it: where general exceptional circumstances that could not have been foreseen destroy the basis on which the contract was priced, the court may extend the period, raise or lower the remuneration, or rescind. That is relief from the law, not from the contract.

Withhold work you have no lien over

Article 820 is unusually direct about the oldest reflex in the industry. If the contractor’s work has produced an effect on the thing, they may retain it until paid — 820(1). If the work has not produced an effect on the thing, they have no right to retain it, and if they retain it anyway and it perishes, they are liable as for usurpation — 820(2).

Whether taking a client’s domain, hosting or ad account offline is retention of something your work produced an effect on, or retention of something else entirely, is the question that decides which paragraph you are standing in. The second carries a materially worse outcome than an unpaid invoice.

What was ordinary practice and is not supported by this text

One item is a certainty rather than a reading. Every contract clause drafted against the 1985 law now cites a repealed instrument. Decree Article 2 repealed it entirely, so any agreement whose governing-law clause, defined terms or numbered cross-references point at Federal Law No. 5 of 1985 is pointing at nothing. That is not an interpretive question, and it is worth a search across your templates this week.

The practices below are common in this market and are not supported by the text as written. Whether the repealed law took a different view is a comparison this piece does not make — see the limits.

• The unchallengeable terms page. Void to the extent it tries to displace Art. 223.

• The one-line retainer. Art. 813 expects a scope, a method, a period and a price. Silence hands all four to a court.

• The open-ended quote. Art. 130(1) binds you to hold an offer open for any period you state; 130(3) exposes you to compensation for the damage a withdrawal causes — though expressly not to the other side’s expected profit.

• “Terms to be agreed later.” Art. 131(2): if the essential elements are agreed and you did not stipulate that the contract is not concluded without the rest, you already have a contract, and the court settles the remainder.

• The letter of intent that binds nothing. Art. 135: a promise to conclude a future contract is invalid unless all essential elements and the period for concluding it are specified.

• The subcontractor who invoices your client. Art. 833: they may not claim from the employer unless you referred them. Art. 832: you subcontract freely unless the contract forbids it or the work is personal — and you stay liable for them.

Who this reaches first

Do you have to change your documents?

Privacy Policy — no, not because of this law

The Civil Transactions Law is not a data protection instrument. Data Nexus searched the full official English text: “personal data”, “data protection”, “privacy” and “cookie” appear zero times across 354 pages. Your privacy policy answers to Federal Decree-Law No. 45 of 2021 on personal data protection and to the cybercrimes law, and neither was touched by this decree. If a piece tells you to rewrite your privacy policy because of the new civil code, it has not read the code.

What does reach it, indirectly: your privacy policy usually sits inside the same terms page a user accepts, and that page is an adhesion contract under Article 118. The consent mechanics belong to the data law; the contract the consent sits in belongs to this one. Our UAE compliance page covers the data side with the amounts and the instruments.

Terms & Conditions — yes, and this is the priority

Two changes, both structural. Any clause purporting to stop a court reviewing your terms for unfairness is void by name under Article 223, so it is occupying space and doing nothing. And Article 120 now reads ambiguity in an adhesion contract against its author, so the broad protective paragraph that survives by being hard to parse has been inverted into a liability.

Two things also need adding rather than removing: a sentence saying whether a listing is an offer or an invitation to treat Art. 127, and a sentence saying where and when a contract is concluded Art. 132. The statute defers to your agreement on both and decides against you on neither — it simply supplies a default you did not choose.

Service Agreement — yes, and for a different reason

A services contract in the UAE is a Muqawala, and Article 813 states what one shall specify: subject matter with its nature and quantity, method of performance, period of completion, consideration. What the contract omits, the law supplies — professional standards and a reasonable period 818(1), payment on delivery 826, remuneration of the like 830. Each of those is a term a court sets after the argument has started.

The clause most agreements are missing is the change-control one. Under Article 829(2) an addition is chargeable only where the client authorised it and the increase was agreed — both, not either.

Do old contracts still hold? — yes, with one exception that surprises people

Article 4 is the ordinary rule: the law runs from commencement and does not reach back over preceding facts and acts. A contract concluded on 30 May 2026 was formed under the repealed law and stays formed under it.

The exception is limitation. Articles 6 and 7 apply the new time bars from 1 June 2026 to every period that had not yet completed on that date — and where the new period is shorter than the old one, it runs from 1 June 2026 even though the old period had already started. An unpaid invoice from 2024 is sitting on a clock that was reset under you. Article 8 keeps evidence under the rules in force when it was prepared.

What to do, by business

SaaS and subscriptions

Your exposure is the renewal and the terms page. Article 128 means a renewal running on silence has no mechanism behind it on a first term, though prior dealing on the same matter may carry it once a customer has renewed before. Articles 118 and 223 make the terms page reviewable however it is drafted, and any clause resisting that is void.

Do this: make renewal an affirmative act or a term agreed at signature rather than an absence of objection; strip the acknowledgement-of-fairness clause; and put the formation sentence Art. 132 in, because your customers are rarely in the same place as you.

Agencies, studios and development shops

You are contracting under Muqawala, and the two provisions that will decide your next dispute are 829(2) on unauthorised additions and 818(2), under which a client who has served notice and not been rectified may engage another contractor to finish or correct the work at your expense.

Do this: a written change order before any added work, naming the price; a defined rectification window in the contract so the notice period is yours rather than theirs; and a handover clause, because Art. 820 decides what you may hold and the answer is narrower than the industry assumes. Our note on handover is what that clause has to cover.

E-commerce and marketplaces

Article 127 is the mispricing question. With nothing said, a listed price is an offer your customer has accepted; with one sentence, it is an invitation and the contract forms on your confirmation. Article 132 then decides where that happened. Article 133 settles auctions: a contract by auction concludes on the fall of the hammer, and a bid lapses when a higher one arrives.

Do this: put both sentences in your terms and mirror them in the checkout confirmation copy, so the page and the contract say the same thing.

AI products and services

Nothing in this law is about artificial intelligence, and that is the point — an AI product sells under the same general law as everything else. Two provisions matter more here than elsewhere. Article 819 makes a contractor liable for damage resulting from their act or workmanship, “whether arising from their transgression or negligence, or otherwise”, excluded only for an unavoidable event. And the disclaimer that carries most AI products — output may be inaccurate, verify before relying — sits in an adhesion contract, so Article 223 lets a court modify it and Article 120 reads every ambiguity in it against you.

Do this: state the limits of the system in specific, checkable terms rather than broad ones, because a precise limitation survives Art. 120 and a sweeping one invites Art. 223. And describe the service by what it does rather than by what it promises — Art. 813 wants a method, and a method is also the most defensible description of a probabilistic system.

Before 1 June 2026 — after 1 June 2026

The left column is ordinary market practice, not a statement about the repealed law. The right column is the text of the instrument now in force.

Website compliance checklist

Ten items. None needs a lawyer to start, and each names the article behind it so you can check whether we are right before you act on it.

What we would do about it

Three things, in this order. None of them takes a quarter.

The DIFC and the ADGM, and why most commentary gets this wrong

The Code says nothing about free zones. Data Nexus searched the full official English text for “free zone”, “DIFC”, “ADGM” and “Global Market” and found no occurrence of any of them. What keeps it out of those two centres sits in a different instrument entirely.

Article 3(2) of Federal Law No. 8 of 2004 on Financial Free Zones subjects them to “all federal laws with the exception of federal civil and commercial laws”. That is the whole basis, and the Constitution contemplates it in Article 121 as replaced by Constitutional Amendment No. 1 of 2003. Inside the DIFC and the ADGM the governing civil and commercial law is the zone’s own — DIFC Law, or in the ADGM the common law of England received directly by section 1(1) of the Application of English Law Regulations 2015.

Three things that follow, and one that catches everyone

It is a rule about which law supplies the answer, not a wall around the territory. The zone courts apply UAE federal law whenever their own choice-of-law rule points at it — and that can happen with no party choice at all. In Larmag Holding B.V. v First Abu Dhabi Bank PJSC [2019] DIFC CFI 054 the DIFC Court of First Instance decided a tort claim under UAE law as the system most closely connected to the facts, under Art. 8(2)(d) of DIFC Law No. 3 of 2004.

Some of the Code admits no choice of law whatsoever. Article 19(2) governs any contract concerning immovable property by the law of the property’s location. Article 821 puts a ten-year liability on the contractor and the engineer for collapse and for defects threatening structural integrity, and Article 823 makes void any clause that limits or excludes it. A zone-incorporated business building or dealing in land onshore is inside those articles whatever its contract says.

Only federal civil and commercial law is carved out. Criminal law has always operated inside both zones, with civil consequences that follow from it.

And the exemption belongs to the two financial free zones established under Law No. 8 of 2004 — nowhere else. In JAFZA, DMCC, DAFZA, RAKEZ, Masdar and every other free zone in the country, the new Code applies in full. Treating “free zone” as one category is the single most common error in commentary on this law, and it is the one most likely to cost a reader something.

What this does not show

• It is not a diff against the old law. Data Nexus read Federal Decree-Law No. 25 of 2025. Establishing which provisions are new, which carried over from 1985 and which were reworded would need the repealed text alongside it, article by article. Where this piece says a practice is unsupported, it means unsupported by the instrument now in force — not that it was lawful before.

• No court has applied it yet. The law commenced on 1 June 2026. Every reading here is a reading of text, and text takes its real meaning from judgments that do not exist.

• The DIFC and ADGM sit outside it — and only those two. See the section below; the carve-out is narrower and leakier than the phrase “free zone” suggests.

• Special provisions prevail. Art. 4(3) preserves special provisions against later general ones. Sectoral regulation — consumer protection, e-commerce licensing, telecoms marketing rules — applies on top of this and is not covered here.

• This is analysis, not advice. A reading of a published instrument by a practice with in-house legal competence is not a legal opinion, and it is no substitute for one on your own contracts.

Questions people are actually asking

When did the new UAE Civil Transactions Law come into force?

1 June 2026. Federal Decree-Law No. 25 of 2025 was issued on 1 October 2025 and set commencement at that date in Article 3 of the promulgating decree.

Does it replace the 1985 Civil Transactions Law?

Entirely. Article 2 of the promulgating decree repeals Federal Law No. 5 of 1985 as amended, without carve-outs.

Do I need to update my privacy policy because of it?

Not because of this law. The words “personal data”, “data protection”, “privacy” and “cookie” do not appear anywhere in its 354 pages. Privacy obligations run from Federal Decree-Law No. 45 of 2021 and the cybercrimes law.

Do I need to rewrite my website terms and conditions?

Yes, on two counts. Any clause purporting to prevent a court reviewing them for unfairness is void under Article 223, and ambiguity in them is now read against you under Article 120.

Are contracts signed before 1 June 2026 still valid?

Yes. Article 4 states the law does not apply retroactively to preceding facts and acts. They were formed under the repealed law and remain so.

So nothing changes for existing contracts?

One thing does. Articles 6 and 7 apply the new limitation periods from 1 June 2026 to every period that had not completed by then, and a shorter new period runs from that date even if the old one had already started.

Is my product page a binding offer?

By default yes — Article 127(1) deems goods or services offered with the consideration stated to be an offer, unless indications exist to the contrary. Article 127(2) treats public price statements as an invitation in case of doubt. Your wording decides which applies.

Where is an online contract concluded?

Article 132: at the time and place acceptance is issued where the parties are connected by direct means of communication, and where the offeror learns of it where they are absent. Both defer to your agreement, and the answer sets the forum.

Can I treat silence as acceptance of a renewal?

Not on its own. Article 128 makes silence acceptance only where there was prior dealing between the parties on the same matter, or the offer was purely for the offeree’s benefit.

Can I bill a client for extra work they asked for verbally?

Article 829(2) allows an increase only where the addition is due to the employer’s fault, or made by their authorisation and the increase in consideration was agreed. A verbal request without an agreed price fails the second limb.

Can I take a client’s website or ad account offline until they pay?

Article 820 permits retention only where the work produced an effect on the thing. Where it did not, there is no right to retain, and retaining anyway makes you liable as for usurpation if the thing perishes.

What must a services contract contain?

Article 813: the subject matter with its nature and quantity, the method of performance, the period of completion and the consideration. What is omitted is supplied by Articles 818, 826 and 830 — by a court, after a dispute.

Does the law apply in the DIFC or ADGM?

Not of its own force. Article 3(2) of Federal Law No. 8 of 2004 subjects the financial free zones to all federal laws except federal civil and commercial ones. But their own courts apply UAE federal law when their choice-of-law rules point at it, and Articles 19(2), 821 and 823 admit no choice of law at all.

Does it apply in JAFZA, DMCC or RAKEZ?

In full. The carve-out belongs to the two financial free zones established under Federal Law No. 8 of 2004 and to no others. Treating “free zone” as one category is the most common error in commentary on this law.

Where can I read the law myself?

The official English text is on the UAE Legislation portal, published by the Ministry of Justice. Every article number in this piece points at that document.

Related reading on this site

• UAE digital compliance — the advertising permit regime, marketing consent and the personal data law, with the named amounts, the instrument behind each and a source per line. This is where the privacy-policy answer lives.

• Handover — what a vendor actually transfers and when, which is the clause Art. 820 makes load-bearing.

• Vendor selection and total cost — judging a supplier on the life of the work rather than the quotation.

• The standard this publication holds — including what it refuses to print.

Three pieces belong beside this one and are not written yet: a reading of the personal data law for websites, a working template note on service agreements under Muqawala, and the terms-and-conditions clause set in full. They are named here rather than linked because this publication does not link to pages that do not exist.

Method, author and review

Disclaimer. This is analysis of a published instrument, not legal advice, and no lawyer-client relationship arises from reading it. It states the position as at 6 August 2026, two months after commencement and before any court has applied the law. Decisions about your own contracts should be taken with counsel who can read them.

Sources

Federal Decree-Law No. 25 of 2025 Promulgating the Civil Transactions Law, on the UAE Legislation portal — the official text published by the Ministry of Justice. Issued 1 October 2025, corresponding to 9 Rabi’ Al-Akhir 1447 in the promulgating clause, published in Official Gazette No. 809 (Supplement 2) of 14 October 2025, and in force from 1 June 2026.

Read in the official English text, 354 pages. Where the Arabic and the English differ, the Arabic governs; every article number in this piece points at the English version linked above, which is where a reader can check it in the same words this was written from.

The free-zone position rests on instruments outside the Code and is cited to them rather than to it: Federal Law No. 8 of 2004 on Financial Free Zones, Art. 3(2); the Constitution, Art. 121 as replaced by Constitutional Amendment No. 1 of 2003; DIFC Law No. 3 of 2004, Art. 8; and the ADGM Application of English Law Regulations 2015, s. 1(1).

Corrected on 6 August 2026. An earlier version of this piece said that free zones run their own regimes and left it there. That was right about the DIFC and the ADGM, wrong to imply the Code is simply unavailable inside them, and wrong to say “free zones” when the carve-out reaches only those two. The correction was prompted by a reader question and it made the piece better; the section above is what replaced it.