Article 356 of the Saudi Civil Transactions Law
المادة 356 من نظام المعاملات المدنية · الفرع الرابع: بيع النائب لنفسه
A representative may not buy for himself what he was entrusted to sell, even at auction or in another's name, without permission; the same applies to an intermediary, expert and the like.
Official text (Arabic)
This article has not been amended since the law was issued.
مع مراعاة النصوص النظامية؛ ليس للنائب أن يشتري لنفسه باسمه أو اسم غيره ولو بطريق المزاد ما عهد إليه بيعه بمقتضى نيابته ما لم يكن مأذونًا له بذلك، كما لا يحق ذلك للوسيط ولا للخبير ولا لمن في حكمهما في الأموال التي عهد إليه بيعها أو تقدير قيمتها.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 356 explained in plain English
This article deals with conflict of interest in sales. A person entrusted with selling another's property should seek the best price for its owner, and this conflicts with his wish to buy for himself at the lowest price.
First: the bar on the representative. A representative, such as an agent, may not buy for himself what he was entrusted to sell by virtue of his representation, and the bar covers:
- buying in his own name;
- buying in the name of another, such as buying through a relative or a nominal person;
- buying even by way of auction.
An exception is where the representative has been permitted to buy.
Second: the bar on the intermediary and expert. Likewise an intermediary, an expert and those in the same position may not buy for themselves, in their own name or another's, even by auction, property they were entrusted to sell or to value.
The article begins with the phrase "subject to statutory provisions", meaning that this ruling applies subject to what other laws may provide.
The effect of breaching this bar is set out in Article 357: the sale does not take effect against the person for whose account it was made unless he approves it, and he may not invoke the non-effectiveness against a specific successor who acquired a real right for consideration in good faith.
Anyone who suspects that his agent or intermediary bought his property for himself is advised to consult a lawyer specialized in civil cases.
Practical example
Saad appointed his friend Majed to sell land in Riyadh, and Majed put it up for auction and bought it in his brother's name without Saad's permission. This is barred by the article, because a representative may not buy what he was entrusted to sell even in another's name or by auction, unless he was permitted.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
How we write and review contentA question about Article 356 of Civil Transactions Law?
Describe what happened and specialist lawyers answer. You can write in English.
- Completely free
- Lawyers from the directory answer
- Your name stays hidden
Civil Litigation & Compensation lawyers: ask a specialist about your case
Describe your situation briefly and we'll suggest a lawyer who specialises in this law
Civil Litigation & Compensation lawyers
Lawyers who handle this kind of case
Dr. Ali Al-Rubaie Law Office and Ittihad Al-Asr Legal Company
Active contributor
Unwan Law Firm
Frequently asked questions about Article 356 of the Saudi Civil Transactions Law
May an agent buy the property he was appointed to sell?
No, unless he is permitted to, even if he buys it in another's name or by auction.
May a real estate intermediary buy for himself the property listed with him?
No. An intermediary, an expert and those in the same position may not buy property they were entrusted to sell or to value.
What is the effect of an agent buying for himself without permission?
Article 357 provides that the sale does not take effect against the person for whose account it was made unless he approves it.
More articles on Sale Contract
- Article 23
The article defines consumable things as those whose use, according to what they are prepared for, is limited to consuming or spending them, and treats everything prepared in stores for sale as consumable.
الأشياء القابلة للاستهلاك هي التي ينحصر استعمالها -بحسب ما أُعدّت له- في استهلاكها أو إنفاقها، ويعد قابلًا للاستهلاك كل ما أعد في المتاجر للبيع.
- Article 44
Paying earnest money gives only the payer the right to withdraw from the contract without recovering it, unless otherwise agreed; the court sets the withdrawal period if the parties have not.
1- دفع العربون عند إبرام العقد يفيد أن لدافع العربون وحده الحق في العدول عن العقد، وليس له إذا عدل أن يسترد مبلغ العربون، وذلك كله ما لم يتفق على خلافه. 2- إذا
- Article 109
The article provides that exchange contracts are concluded on the basis that the subject matter is free of defects except what custom tolerates, and that an intolerable defect is a breach of the obligation.
تُعدُّ عقود المعاوضات منعقدةً على أساس سلامة محل العقد من العيوب إلا ما جرى العرف على التسامح فيه، فإذا تبيَّن في المحل عيبٌ لم يجر العرف على التسامح فيه؛ عُدَّ
- Article 165
The article provides that a right to a thing specified by kind attaches to a particular item only once it is set apart, and lets the creditor, on non-performance, obtain a like item at the debtor's expense.
1- إذا تعلق الحق بشيء معين بالنوع لا بالذات، فإنه لا يختص بشيء بذاته من ذلك النوع إلا بإفرازه. 2- إذا لم يقم المدين بتنفيذ التزامه جاز للدائن أن يحصل على شيء من
- Article 166
The article places the risk of destruction or damage on the debtor who failed to deliver, in two cases: transfer of a real right and an obligation to perform work involving delivery, each on different conditions.
1- الالتزام بنقل حق عيني يتضمن الالتزام بتسليم الشيء والمحافظة عليه حتى تسليمه، فإذا لم يقم المدين بتسليمه حتى هلك أو تلف كانت تبعة ذلك عليه. 2- إذا كان محل الا
- Article 307
Article 307 defines sale as a contract under which the seller transfers ownership of the item sold to the buyer for a cash price.
البيع عقد يُمَلِّكُ بمقتضاه البائع المبيع للمشتري مقابل ثمنٍ نقدي.
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.