The Council of Ministers of the Kingdom of Saudi Arabia (“KSA”) recently passed a resolution to strengthen the country’s arbitration and ADR framework (the “Resolution”), demonstrating a continued commitment to a range of legal reforms central to its Vision 2030 strategy. The Resolution outlines strategic measures to enhance efficiency, increase transparency, and align with international best practices in dispute resolution, with the aim of strengthening investor confidence in the country and the region.
Key Elements of the Resolution
The Resolution sets forth a comprehensive strategy to strengthen the arbitration landscape in the KSA. Key directives include the following:
- Legislative and Regulatory Review: The KSA National Competitiveness Centre, in collaboration with key government ministries, will conduct a review of the Arbitration Law issued by Royal Decree No. (M/34)1 in 2012 (the “Arbitration Law”) and its Implementing Regulations and will report on their findings for further action.
- Enhanced Judicial Transparency: To enhance legal predictability, the Resolution calls for the translation and publication of selected arbitration-related court judgments, offering valuable insight into local judicial practices and promoting transparency.
- Improved Procedural Efficiency: The Resolution calls for greater technical integration between government e-services and institutional arbitration platforms to streamline case administration.
- Fostering Research and Awareness: A study has been launched to evaluate the global perception of arbitration practices in the KSA, focusing on the quality of proceedings and outcomes. The Resolution also promotes academic research into arbitration and training programmes to support the sector's growth and development.
The Resolution Strengthens the Existing Arbitration and ADR Framework
The Resolution builds on a decade of substantial reforms. A key milestone for arbitration in the KSA was the enactment of the Arbitration Law in 2012, which is modelled on the UNCITRAL Model Law. The Arbitration Law increased party autonomy, reduced the courts’ supervisory role in arbitral proceedings, and aligned arbitrations seated in the KSA more closely with international standards. These reforms were further strengthened by the Execution Law issued by Royal Decree No. (M/53)2 in 2012, which provided a more streamlined process for enforcing domestic and foreign arbitral awards.
The subsequent creation of the Saudi Center for Commercial Arbitration (“SCCA”) in 2014 equipped the KSA with a modern, independent institution to administer disputes. Since then, the SCCA has evolved rapidly, leading to the adoption of its updated Arbitration Rules in 2023. These rules include notable advancements, such as the formation of an independent SCCA Court to act as a supervisory body, similar to courts of institutions such as the International Chamber of Commerce (“ICC”).
Implications for Dispute Resolution in the Region
The ongoing improvement of arbitration in the KSA is integral to the objectives of Vision 2030, a strategic plan for economic diversification that depends on attracting foreign direct investment to support large-scale development projects. These advancements are supported by a judiciary with a pro-enforcement stance, with the KSA’s Minister of Justice confirming at the Third Saudi Commercial Arbitration Conference held in 2024 that 90% of arbitral awards challenged through annulment applications in the KSA courts were upheld. For international parties and legal practitioners, this fosters a more stable, transparent, and arbitration-friendly jurisdiction. The Resolution therefore reflects yet another step to strengthen the KSA’s reputation as a trusted hub for international dispute resolution.
1Royal Decree No. (M/34) dated 24/05/1433 AH (corresponding to 16/04/2012 AD).
2Royal Decree No. (M/53) dated 13/08/1433 AH (corresponding to 03/07/2012 AD).
