Contract formation in Egypt is primarily governed by the Egyptian Civil Code (Law No. 131 of 1948), which adopts many principles from the French Civil Code but with distinctive local nuances. While the general theory of obligations governs offer and acceptance, practical complications often arise—especially in cross-border negotiations or where parties exchange differing sets of standard terms, a situation commonly referred to as the “battle of the forms.”
Law No. 131 sets out a clear but nuanced framework for the creation of contracts. Its provisions, found primarily in Articles 89 through 98, reflect a synthesis of Roman–French civil-law theory and Egyptian judicial interpretation. The essence of contract formation lies in the meeting of wills, a genuine alignment between offer and acceptance on all essential elements.
The Meeting of Wills
Article 89 provides the cornerstone rule:
“A contract is formed when the offer and acceptance meet, provided that both parties are of sound mind and possess legal capacity.”
This deceptively simple sentence conceals layers of interpretive depth. Egyptian jurists and the Court of Cassation have repeatedly confirmed that a contract exists only when two concurring declarations of will coincide on the essential elements of the agreement—namely, the subject matter and consideration—with the intention to create legal obligations. Any ambiguity as to those essentials defeats formation.
In practice, the meeting of wills must not merely be moral or social; it must be legally oriented, reflecting the parties’ awareness that their expressions carry binding force. Egyptian law thus rejects “agreements to agree” or “letters of intent” that lack definiteness, treating them as pre-contractual negotiations rather than binding commitments.
The Offer
Under Article 91, the offer is a declaration “made by one person to another indicating the elements of the contract proposed and the intention to be bound if accepted.” Once an offer reaches the offeree, it becomes effective, and—subject to the rules on withdrawal—it may bind the offeror for the period stated.
Article 92 clarifies that revocation of the offer is effective only if it reaches the offeree before the offeree has dispatched acceptance, not merely before it is received. This distinction embodies the civil-law “receipt theory,” ensuring that once the offeree has sent acceptance, the offeror can no longer revoke.
This temporal rule becomes pivotal in international commerce. When an Egyptian exporter issues a quotation to a European buyer, the offer becomes effective once received abroad. Revocation by email or telex after the buyer has already sent acceptance will not prevent contract formation, since dispatch of the acceptance terminates the offeror’s power to revoke.
The Acceptance
Acceptance, in turn, must correspond exactly to the offer’s terms. Article 91(2) explicitly states that:
“An acceptance which contains additions, restrictions, or modifications shall be regarded as a rejection of the offer and shall constitute a new offer.”
This is the foundation of the so-called “mirror-image rule.” Acceptance may be express (in writing or orally) or implied by conduct, delivery of goods, commencement of performance, or even issuance of an invoice. However, Egyptian law is cautious in inferring consent: silence does not ordinarily constitute acceptance, except where prior dealings or trade custom justify that inference (Article 96). Courts have accepted that long-standing suppliers may treat an unobjected-to purchase order as accepted, reflecting the weight of commercial usage.
The timing of acceptance is equally significant. Article 98 provides that the contract is formed at the moment the acceptance reaches the offeror—not when it is sent. This “receipt theory” contrasts with the Anglo-American “postal rule,” under which acceptance is effective upon dispatch. The Egyptian system therefore emphasizes receipt, ensuring certainty as to when mutual consent crystallizes.
Defects in Consent
No formation is valid if consent is vitiated by error, fraud, or coercion, as provided under Articles 120 to 125 of the Civil Code. Egyptian jurisprudence interprets “error” narrowly: only mistakes affecting the essential attributes of the object or the identity of the contracting party suffice. Fraud (غش) must involve intentional deception that induces the contract, and coercion (إكراه) must create a state of justified fear. Where such defects are proven, the contract is voidable, not void—allowing the injured party to seek annulment.
Comparative Overview
This civil-law architecture stands midway between French rigor and Anglo-Saxon flexibility. While Egyptian law prizes the symmetry of offer and acceptance, it also recognizes modern commercial practices by validating acceptance through conduct.
Modern commerce rarely unfolds through a single, tidy exchange of offer and acceptance. Instead, parties trade purchase orders, confirmations, and invoices—each laced with pre-printed “standard terms” drafted to favor its author. When those documents conflict, the civil-law concept of mutual consent collides with commercial reality. Egyptian law does not contain a codified “battle-of-the-forms” doctrine, yet its general rules on offer and acceptance (Articles 91–98) provide the framework for resolving such clashes.
The Mirror-Image Principle
Article 91(2) draws a bright line:
“An acceptance containing additions, restrictions, or modifications shall be regarded as a rejection of the offer and shall constitute a new offer.”
This principle means that for a contract to form, the acceptance must replicate the offer in every essential term. Any discrepancy, however minor, transforms the purported acceptance into a counteroffer. Egyptian courts, influenced by French jurisprudence, have consistently upheld this view, holding that the meeting of wills must be exact.
Consequently, if a supplier’s confirmation includes liability limitations or a choice-of-law clause that the buyer’s order omitted, the supposed “acceptance” is no acceptance at all. No contract exists until the other side expressly or implicitly assents to those new terms.
Despite doctrinal rigidity, Egyptian courts recognize that commerce cannot halt at formalism. When both parties perform, the seller delivers goods and the buyer accepts them, the courts infer that a contract has been concluded by conduct, even if the paperwork never aligned. This pragmatic inference derives from Article 93, which allows consent to be expressed “in any form,” and from Article 147, which binds parties once a lawful contract is formed.
In such cases, the terms of the contract are not the last document sent, as in certain common-law jurisdictions, but rather those provisions on which the parties evidently agreed, supplemented by custom and general law. The Court of Cassation has emphasized that performance evidences intention and thus suffices to establish a binding relationship, though it may leave gaps later filled by default legal provisions.
When both sides exchange contradictory forms yet proceed to perform, Egyptian doctrine resolves the impasse by examining the common intention of the parties. If neither form was expressly accepted, the conflicting clauses cancel each other out, and only the non-conflicting terms survive. The remaining gaps are supplied by statutory rules or commercial custom (ʿurf tijārī).
For instance, if the buyer’s order stipulates arbitration in London while the seller’s confirmation calls for Cairo courts, and neither party objects before delivery, performance suggests acceptance of a sale contract, but the arbitration clause, being disputed, may be deemed non-agreed and therefore inoperative. The default jurisdiction of Egyptian courts then applies under Article 28 of the Civil and Commercial Procedures Law (Law No. 13 of 1968).
The Role of Good Faith
Article 148 of the Civil Code imposes an overarching duty that:
“A contract must be performed in good faith.”
This principle guides judicial discretion when determining which standard terms prevail. Courts favor interpretations that reflect commercial reasonableness and prevent one party from springing unexpected conditions on the other. The doctrine of good faith thus tempers the formal mirror-image rule, allowing equitable adjustment where literal adherence would undermine fairness.
Timing, Withdrawal, and Proof of Consent in the Digital Era
Although the Egyptian Civil Code was drafted long before the advent of electronic communication, its principles have proven remarkably adaptable. The judiciary has consistently applied the doctrines of receipt, intention, and good faith to modern contracting, including email exchanges and digital confirmations.
Under Article 98, a contract is formed “at the time when the acceptance reaches the offeror.”
This “receipt theory” means that the act of dispatching an acceptance is not, by itself, sufficient, it must actually reach the offeror in a manner that places it under their control.
This contrasts with common-law systems where the “postal rule” can render an acceptance effective upon dispatch. The Egyptian approach prioritizes certainty and evidence: a party must prove that the acceptance actually reached the offeror, whether physically, by fax, or electronically. The rationale is to prevent contracts from arising “in the air” without the knowledge of one party.
Withdrawal and Revocation
The Civil Code distinguishes clearly between revocation of an offer and withdrawal of acceptance.
Under Article 92, an offeror may revoke an offer only if the revocation reaches the offeree before the offeree has dispatched acceptance. Once acceptance has been sent, revocation is ineffective.
Similarly, an offeree who wishes to retract their acceptance must ensure that the withdrawal reaches the offeror before or at the same time as the acceptance.
This elegant symmetry reflects the same “receipt” logic on both sides. Egyptian courts have applied it strictly: for instance, if an email accepting a quotation is received at 3:00 p.m., but a withdrawal email sent at 3:10 p.m. arrives later, the contract is already complete. In practice, this places a premium on timestamped evidence, now critical in digital contracting.
Electronic and Email-Based Contracts
Egypt recognized the legal validity of electronic contracts and signatures through Law No. 15 of 2004 on the Regulation of Electronic Signatures and the Establishment of the Information Technology Industry Development Authority (ITIDA).
Article 14 of that law affirms that an electronic document “shall not lose its legal effect or enforceability solely because it is in electronic form,” provided it satisfies authenticity and integrity criteria.
The Court of Cassation has upheld that emails and electronically signed documents may constitute valid proof of offer, acceptance, or acknowledgment of debt if their authenticity can be technically verified. This follows the principle of functional equivalence, electronic communications are treated as legally equivalent to written correspondence if they reliably identify the parties and preserve the content without alteration.
To qualify, the electronic signature must:
- Be unique to the signer;
- Be created using means under the signer’s sole control;
- Be linked to the signed data so that any change is detectable.
When these conditions are met, courts presume authenticity unless challenged. If a signature lacks certification by an authorized provider, the burden of proof shifts to the relying party to demonstrate its validity through expert examination.
Conclusion
Contract formation under Egyptian law continues to reflect the precision of civil-law tradition while evolving to accommodate modern commerce. The meeting of wills remains the foundation of every enforceable agreement, yet the methods of expressing that will have multiplied—from handwritten signatures to certified digital tokens.
The Egyptian Civil Code, supported by judicial interpretation and the e-signature regime of Law No. 15, ensures that both traditional and electronic agreements are judged by the same touchstone: clear, provable mutual consent.
For practitioners and businesses, the practical lesson is simple but vital: document intention, confirm receipt, and align written terms before performance begins. When offer and acceptance are properly evidenced, Egyptian law provides one of the most coherent and reliable frameworks in the Middle East for enforcing commercial agreements.
Frequently Asked Questions
What Are the Rules of Contract Formation in Egypt
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Contract formation in Egypt is governed mainly by the Civil Code (Law No. 131 of 1948). A contract requires a valid offer, an exact acceptance, and the parties’ legal capacity. Consent must be free of error, fraud, or coercion.
How Does Offer and Acceptance Work in Egypt
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An offer becomes binding once received by the offeree, and acceptance is valid only when it reaches the offeror. Any changes to the offer count as a counteroffer, not acceptance.
When Is a Contract Formed Under Egyptian Law
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A contract is formed at the moment the acceptance reaches the offeror. This follows the “receipt theory,” which differs from the Anglo-American “postal rule.”
Is Silence Considered Acceptance in Egypt
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Silence usually does not count as acceptance. However, Egyptian law allows exceptions if prior dealings or trade customs show that silence reasonably indicates consent.
How Are Electronic Contracts Valid in Egypt
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Electronic contracts are recognized under Law No. 15 of 2004. An electronic signature is valid if it is unique, under the signer’s control, and linked to the signed data.
What Happens in the Battle of the Forms in Egypt
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If parties exchange conflicting terms, no contract is formed until mutual consent exists. If both perform, only agreed terms apply, with disputes settled by default legal rules.
Can a Contract Be Revoked After Acceptance in Egypt
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Once acceptance has been dispatched by the offeree, the offeror cannot revoke the offer. Similarly, an offeree can only withdraw acceptance if the withdrawal reaches the offeror before or at the same time as acceptance.
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