In partnership with Al Akeel & Partners,Marc SaroufimandYasmin Talal Behericontributing
The government of the Kingdom of Saudi Arabia ("the KSA") recently announced a resolution by the Council of Ministers ("Resolution") which seeks to further develop arbitration in the KSA. In this Legal Update, we highlight the key initiatives envisaged by the Resolution and their intended impact.
KEY INITIATIVES
The Resolution directs that several initiatives be undertaken, the most relevant of which are:
- A new review of the Saudi Arbitration Law;
- University-led studies on global perceptions of the KSA as an arbitral seat;
- Directives to translate and publish court judgments in arbitration-related cases in order to increase transparency around judicial practices;
- An initiative for arbitral institutions and courts to leverage technology to make case administration more efficient; and
- Support for attracting more public events around arbitration, such as Riyadh International Disputes Week which launched in 2024.
BUILDING ON A RENEWED FOUNDATION
The Resolution comes on the back of several key steps taken by the Saudi government in the last decade to not only modernise the arbitration landscape in the KSA, but to attempt to position itself as a major seat in the region.
The Saudi Arbitration Law was first introduced in 1983 and then updated in 2012 to broadly resemble the UNCITRAL Model Law. the KSA also became a signatory to the New York Convention in 1994, kicking off a new era of arbitration domestically, which evolved into an international campaign to bring the KSA into the forefront of commercial arbitration.
As part of the KSA's efforts to grow and streamline their arbitration industry, the government took proactive steps throughout the 2010's, including:
- re-training the judiciary in arbitration and award enforcement under the NYC;
- establishing the Saudi Center for Commercial Arbitration ("SCCA") and investing in capacity building for their executive staff; and
- facilitating appointments of a new generation of local arbitrators through the SCCA, including female panel members.
The SCCA too has seen growth in the numbers of domestic and international arbitrations seated in Saudi Arabia in recent years (see the SCCA annual report here). In addition, the court judgments have shown a trend towards uniform application of NYC principles. The SCCA too has seen growth in the numbers of domestic and international arbitrations seated in Saudi Arabia in recent years.
INTENDED IMPACT FOR ARBITRATION IN the KSA
Against the backdrop of recent progress, the Resolution recognises the role that arbitration plays in boosting the KSA's profile internationally in terms of adherence to the rule of law and in boosting the economy. The Resolution seeks to make arbitration practices more sophisticated, bolster business transactions in the country and generate a higher demand for legal services connected to arbitration. The above initiatives also indicate a desire to move the KSA towards a new phase of arbitration where an increasing reputation for consistency and transparency could make the KSA the regional arbitration hub.
Want to know more about arbitration in the KSA? See our four-part, in-depth series in partnership with Al Akeel & Partners here.
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