Article 382 of the Saudi Civil Transactions Law
المادة 382 من نظام المعاملات المدنية · الفصل الرابع: عقد القرض
The article defines a loan as a contract by which the lender transfers ownership of a fungible thing to the borrower, on condition that the borrower returns its equivalent.
Official text (Arabic)
This article has not been amended since the law was issued.
القرض عقد يُمَلِّكُ بمقتضاه المقرِضُ شيئًا مثليًّا للمقترض على أن يرد مثله.
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 382 explained in plain English
This article sets out the definition of the loan contract in the Civil Transactions Law, which rests on the following elements:
- A contract between two parties: the lender, who gives, and the borrower, who takes.
- Transfer of ownership: the lender transfers ownership of the borrowed thing to the borrower, meaning it passes to him and he may dispose of it; it is not limited to using it and then returning the very same thing.
- A fungible thing: the subject of the loan is a fungible thing, that is, one that has similar equivalents that can stand in for one another, such as money or quantities of a particular commodity.
- Returning the equivalent: the borrower is obliged to return the equivalent of what he took, not the same thing.
This definition explains why the subject of a loan must be fungible: the borrower will consume the thing or dispose of it, and then return something equivalent to it.
Article 383 adds a condition for the formation of a loan, namely that it is formed only by taking possession of the borrowed thing; a mere agreement on a loan without receiving the money is not enough for it to be formed.
This definition alone does not address matters such as the time or place of repayment or its costs; it only defines the nature of the contract.
If a dispute arises over how a particular dealing is to be characterized, whether as a loan or another contract, it is advisable to consult a lawyer who specializes in civil cases or in banking and finance, depending on the nature of the loan.
Practical example
Yousef gave a colleague at work five thousand riyals on condition that he return it to him later. This is a loan contract: Yousef transferred ownership of a sum of money, which is a fungible thing, on condition that the colleague return its equivalent, not the same banknotes.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 382 of the Saudi Civil Transactions Law
What is a loan under the Civil Transactions Law?
It is a contract by which the lender transfers ownership of a fungible thing to the borrower, on condition that he returns its equivalent.
Does the borrower return the same thing?
No. The borrower is obliged to return the equivalent of what he borrowed, not the same thing.
When is a loan formed?
Article 383 provides that a loan is formed only by taking possession of the borrowed thing.
More articles on Loan Contract
- Article 383
The article provides that a loan contract is formed only when the borrower takes possession of the borrowed thing.
لا ينعقد القرض إلا بقبض الشيء المقترض.
- Article 384
The article requires the lender to have full legal capacity, and prevents a guardian or custodian from lending the money of a person under his authority, or borrowing for him, except in accordance with the legal provisions.
1- يجب في القرض أن يكون المقرض كامل الأهلية. 2- ليس للولي أو الوصي إقراض مال من هو في ولايته ولا اقتراضه إلا وفقًا للنصوص النظامية.
- Article 385
The article makes void any condition, made at the time of the contract or when payment is deferred, that includes an increase in the repayment of the loan paid by the borrower to the lender.
يقع باطلًا كل شرط عند العقد أو عند تأجيل الوفاء يتضمن زيادة في رد القرض يؤديها المقترض إلى المقرض.
- Article 386
The lender does not guarantee against a third-party claim to the borrowed money or its defects unless he concealed them or guaranteed it is free of them; the borrower's duty to return an equivalent lapses on a claim, and a defective item is returned at its value as defective.
1- لا يضمن المقرِض استحقاق المال المقترَض ولا خلوه من العيوب، ولكنه مسؤولٌ عما يلحق المقترض من ضرر بسبب الاستحقاق أو العيب إذا تعمد إخفاء أيٍّ منهما أو ضمن خلو
- Article 387
The article sets the time for repaying a loan: if a term or purpose was fixed, repayment is not due before it ends; otherwise it is due when the lender asks, unless the borrower would be harmed.
1- إذا عُيِّن للقرض أجلٌ أو غرضٌ لم يلزم المقترض الوفاء قبل انقضاء الأجل أو المدة المعتادة للانتفاع به في مثل ذلك الغرض. 2- إذا لم يعين للقرض أجلٌ أو غرضٌ لزم ا
- Article 388
The article obliges the borrower to return the equivalent of the borrowed thing in amount, type and description when the loan period ends; if returning the equivalent is impossible, he must return its value on the day of borrowing.
يلتزم المقترِض برد مثل الشيء المقترَض مقدارًا ونوعًا وصفةً عند انقضاء مدة القرض، فإذا تعذر رد مثله وجب رد قيمته يوم الاقتراض.
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.