Commercial law in Jordan is the practical backbone of doing business in the Kingdom. It sets the rules under which companies are formed and governed, contracts are enforced, goods and services move, and disputes are resolved. For any business, domestic or foreign, understanding the fundamentals is essential.
Sources of Commercial Law
Jordan is a civil-law jurisdiction. The main sources of commercial law include the Commercial Code, the Civil Code, the Companies Law, the Competition Law, the Consumer Protection Law, and a range of sector-specific regulations covering banking, insurance, telecommunications, and more. Judgments of the Court of Cassation provide authoritative interpretation, and Jordanian law is increasingly shaped by free-trade commitments, including the Jordan, US and Jordan, EU agreements.
Company Formation and Corporate Governance
Most international businesses enter Jordan through a limited liability company (LLC), a private shareholding company (PSC), or a branch of a foreign company. Each structure has its own capital requirements, governance rules, and tax implications. The Companies Control Department oversees incorporation and ongoing compliance, and foreign ownership is permitted in most sectors, though certain activities remain restricted or reserved for Jordanian nationals. Getting the structure right at the outset avoids expensive restructuring later.
Commercial Contracts and Enforcement
Contractual freedom is a cornerstone of Jordanian commercial law, subject to mandatory provisions of the Civil and Commercial Codes. Well-drafted contracts govern everything from agency and distribution arrangements to supply agreements, construction contracts, and franchise agreements. In disputes, Jordanian courts generally enforce the parties' chosen terms, but parties should be mindful of specific rules on agency termination, distributor compensation, and limitation periods that can catch foreign lawyers by surprise.
Dispute Resolution Options
Commercial disputes in Jordan can be resolved through negotiation, mediation, arbitration (institutional or ad hoc), or litigation before the ordinary courts. Jordan is a party to the New York Convention, which means foreign arbitral awards are enforceable subject to limited grounds of challenge. For many international clients, a well-drafted arbitration clause referring disputes to a recognized institution is the preferred choice.
How We Help
Our commercial lawyers advise clients on every stage of the business lifecycle: incorporation, contracts, regulatory compliance, restructurings, exits, and disputes. To discuss a specific matter, visit our contact page, call +962 79 566 6696, or email info@abdullahfirm.com.
