Option Agreements Under Civil Law

An option agreement is a contractual arrangement where one party (the grantor) provides another party (the option holder) the right, but not the obligation, to enter into a specified transaction under defined conditions within a certain period.

UAE as a civil law jurisdiction typically upholds the principle of freedom of contract which allows parties to structure option agreements as they see fit, subject to mandatory legal provisions and provided it is not contravening public policy/ order.

Essential Elements of an Option Agreement

An option agreement under civil law must typically include the following elements:

1. Offer and Acceptance: The agreement must clearly outline the offer extended by the grantor and the right of the option holder to accept it within a specified term.