On January 28, 2026, the Constitutional Chamber of the Libyan Supreme Court reportedly declared four laws enacted by the House of Representatives (HoR) unconstitutional. The ruling targets measures that had reshaped judicial governance and attempted to unwind legislation issued by competing legislative authority during the 2014–2016 institutional split. While official texts and implementation steps are awaited, the decision is poised to carry significant political and legal consequences.
The Laws Annulled
The Court’s decision is understood to invalidate the following HoR enactments. First, Law No. 22 of 2023 on Amending the Law on the Judicial System which gave the HoR the power to appoint the head of the Supreme Council of Judicial Bodies, the apex administrative authority within the judiciary. Second, Law No. 32 of 2023 further amended the Judicial System Law by requiring the head of the Supreme Council of Judicial Bodies to take the legal oath before the Office of the HoR Presidency. Third, Law No. 6 of 2015 on General Amnesty granted broad amnesty to people convicted of certain crimes from the onset of the February 2011 revolution through the law’s date of issuance. Fourth, and most consequential for private law, Law No. 1 of 2020 which purported to repeal all laws and resolutions issued by the General National Congress after the end of its mandate, the so‑called “second GNC” between August 2014 and mid‑2016, thereby seeking to nullify, among other instruments, the 2016 amendments to the Libyan Civil Code.
Political and Institutional Implications
The decision strikes at the HoR’s claimed prerogatives over the judiciary and is likely to be read as a reaffirmation of judicial independence and the separation of powers. Invalidating the 2023 judicial governance amendments removes legislative encroachment over the appointment and swearing‑in of the judiciary’s top administrative leadership. Annulment of the General Amnesty law may also have ramifications for reconciliation processes and pending or concluded criminal matters that relied on amnesty provisions, with case‑by‑case effects depending on procedural posture and subsequent guidance from competent authorities.
Civil and Commercial Impact: Re‑Emergence of the 2016 Civil Code Amendments
The commercial impact is most pronounced if, as a matter of law, the fall of Law No. 1 of 2020 restores the force of the 2016 Civil Code amendments that the HoR sought to displace. Those amendments were introduced with the stated aim of aligning private law more closely with Islamic sharia and made several changes that materially affect contract risk allocation and remedies.
In particular, the 2016 amendments: (i) revised Article 220 to prohibit agreements that exclude liability, curtailing parties’ ability to contract out of responsibility for breach; (ii) revised Article 226 to prohibit parties from stipulating liquidated damages in advance, undermining common drafting practices for pre‑agreed remedies; (iii) introduced Article 224 (3) to exclude compensation for breach where the obligation is a monetary debt, constraining claims for damages for late payment beyond the principal sum; and (iv) abolished Article 229, removing statutory default interest as a remedy. If reinstated and applied by courts, these provisions would significantly limit the effectiveness of limitation‑of‑liability clauses, liquidated damages provisions, and interest‑based late‑payment protections in Libyan‑law contracts. We discussed this in detail in a previous client alert, for more information please see here.
Practical Considerations for Businesses and Lenders
Parties with Libyan‑law governed contracts, Libyan counterparties, or Libyan enforcement risk should promptly assess exposure. Contract portfolios should be reviewed for limitation‑of‑liability clauses, liquidated damages provisions, default interest terms, and damages frameworks premised on monetary‑debt breaches. Pricing models and credit terms may require adjustment to reflect a greater reliance on principal repayment without compensatory interest or pre‑agreed damages. Dispute resolution strategies should consider forum and governing law choices, recognizing potential public‑policy constraints at the enforcement stage in Libya even where foreign law and arbitration are selected. Lenders should revisit default‑interest constructs and consider structural mitigants, including enhanced security and covenants. Finally, stakeholders should monitor court practice for guidance on the temporal application of the ruling, any transitional regimes for judgments or settlements relying on annulled laws.
What Comes Next
Next steps typically include publication of the judgment. Market participants should expect a period of adjustment as courts and agencies harmonize practice with the decision, if at all. In Libya’s evolving political and legal environment, the implementation of laws and binding rulings is not always consistently observed. Prudent risk management favors conservative drafting for new agreements, targeted amendments to high‑value contracts, and contingency planning for ongoing disputes and enforcement actions within Libya.
This alert is intended to provide a high‑level overview of a rapidly developing situation. Parties should seek transaction‑specific advice regarding the decision’s impact on existing and future arrangements.
If you would like more information about this topic then please contact us.
-
PARTNER
-
SENIOR ASSOCIATE
BERLIN | Amereller Rechtsanwälte PartG mbB | Kurfürstenhöfe, Spreeufer 5, 10178 Berlin, Germany| T: +49 30 609 895 660
This client alert is a public document for informational purposes only and should not be construed as legal advice. Readers should not act upon the information provided here without consulting with professional legal counsel. This material may be considered advertising under certain rules of professional conduct. Copyright © 2026
