Contract (Formation and Remedies) (Scotland) Bill

A contract is a legally binding agreement between two or more people or groups who are involved in the agreement. These people or groups are commonly referred to as “parties”. The Bill introduces a set of rules that apply to different types of contract. These rules cover:

how a contract is agreed (also known as the formation of the contract), and
what happens if the terms of the contract are not met (also known as remedies for breach of the contract).

This is a Government bill

The Bill was introduced on 2 October 2025 and is at Stage 1

Contract (Formation and Remedies) (Scotland) Bill has completed Introduced

Contract (Formation and Remedies) (Scotland) Bill is currently at Stage 1

Stage 2 has not been reached yet

Stage 3 has not been reached yet

Act has not been reached yet

This Bill is at Stage 1 of the process to decide if it should become an Act.

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Overview

The Bill is in two main parts.

Part 1 contains a statement of the law on formation of contract between parties. This includes:

requirements for a contract to be formed (for example, the parties agreeing on key matters in the contract),
rules on what forms an offer to enter into a contract and when an offer may be revoked by a party (for example, before the other party accepts the offer),
rules on when an offer may lapse (for example, when there is a change of circumstance, like the person making the offer dying),
what is meant by the acceptance, rejection or withdrawal of an offer,
the time limits for agreeing a contract.

Part 2 sets some rules for when someone can ask for help or compensation after a contract has been broken. This includes circumstances where:

both parties have broken the terms of a contract,
there needs to be a return of a benefit (like money or goods),
there is no agreed price, defining how a benefit is valued so that compensation can be given,
a party suffers loss partly through their own fault and partly through the fault of the other party.

Why the Bill was created

The Bill aims to make contract law clearer and more easily understood.

The Bill is based on recommendations made by the Scottish Law Commission in its report: Review of Contract Law: Formation, Interpretation, Remedies for Breach and Penalty Clauses.

All Bills introduced in the Parliament must be accompanied by specific documents. For most Bills, this includes:

Explanatory Notes: this document provides an overview of what the Bill does, plus a more detailed explanation of individual provisions.

Policy Memorandum: this sets out the objectives of the Bill. It also lists any alternatives considered, details of consultations, and an assessment of the effects of the Bill on a range of areas.

Financial Memorandum: this sets out estimates of costs, savings, and any changes to revenues expected to result from the Bill.

Delegated Powers Memorandum: this is needed if a Bill gives powers to make subordinate legislation or allows Scottish Ministers to issue directions, guidance or codes of practice.

Statements on legislative competence: two short statements, one by the Presiding Officer and one by the Member introducing the Bill. “Legislative competence” means the powers the Parliament has to make law.

Research on the Bill

The Scottish Parliament's Information Centre (SPICe) prepares impartial research and analysis to assist MSPs in their examination of Bills and other parliamentary business.

A research briefing will be published in due course.

The Bill was introduced on 2 October 2025

At Stage 1, the Bill is given to a lead committee. This is usually the committee whose remit most closely relates to the subject of the Bill. The lead committee will consider and report on the Bill. Other committees may also examine the Bill and report to the lead committee. Finally, there is a debate and vote by all MSPs on the general principles of the Bill. If the general principles are not agreed to, then the Bill ‘falls’ and can’t become law.

Lead committee examines the Bill

The lead committee for this Bill is the Delegated Powers and Law Reform Committee.

The lead committee will usually examine the Bill through evidence sessions. This will involve contributions from individuals and organisations, known as 'witnesses', with knowledge of the subject matter. The committee might also discuss the Bill in private sessions.

Stage 1 report by the lead committee

The lead committee will publish its Stage 1 report before a debate on the general principles.

Contract (Formation and Remedies) (Scotland) Bill

Introduced: the Bill and its documents

Overview

Why the Bill was created

Bill as Introduced

Accompanying Documents

Accompanying Documents (print versions)

Research on the Bill

Stage 1: general principles

Lead committee examines the Bill

Stage 1 report by the lead committee