According to Article 6 of the Law of the Judiciary, The Supreme Judicial Council supervises all courts. The judicial legal system in Saudi Arabia consists of the following:

1. The Supreme Court. 
2. The Court of Appeal. 
3. The Court of First Instance.^[1]

The Commercial Courts Law (CCL), which came into effect on 16 June 2020 and introduced major changes to the civil justice system, indicates that there are two stages to the litigation procedure. The parties first argue their case before the Court of First Instance. The decision of the first instance court can then be challenged before the appellate court.^[2] However, rather than adjudicating commercial cases, the Supreme Court’s role is to evaluate the constitutional validity of the rulings of the lower courts, if required, in terms of applying and interpreting Sharia principles and regulations. The Supreme Court can also scrutinise the procedures that were followed in the trial, without having the right to interfere in assessing the facts or evaluating the evidence.

The CCL governs the procedures of the commercial courts and applies to all disputes that fall within their jurisdiction. Pursuant to the CCL, the following types of claim can be brought before a commercial court:

1. Disputes arising between merchants relating to their business activities.
2. Cases filed against a merchant in a commercial contract dispute if the original Law of Commercial Courts claim exceeds SAR 500,000. 
3. Disputes between partners in a Mudaraba company.
4. Claims and violations arising from the implementation of the Companies Law.
5. Claims and violations arising from the implementation of the Bankruptcy Law.
6. Claims and violations arising from the implementation of intellectual property laws.
7. Claims and violations arising from the implementation of other commercial laws.
8. Cases and claims relating to appointed judicial receivers, trustees, liquidators, or experts, and the like, if the dispute is related to cases falling under the jurisdiction of the court.
9. Claims for compensation for damages arising from a previous ruling issued by the court.^[3]

In addition to the CCL, the procedural rules governing commercial disputes are also derived from the following laws:

• Law of the Judiciary. 
• Law of Civil Procedure.^[4]
• Law of Evidence.^[5]
• Law of Judicial Fees.^[6]

^{[1] Article 9 of the Law of the Judiciary, enacted under Royal Decree No. M/78 dated 9/19/1428H (October 1, 2007).} 

^{[2] Commercial Courts Law, enacted under Royal Decree No. M/93 dated 15/08/1441H (8 April 2020).} 

^{[3] Article 16 of the Commercial Courts Law, enacted under Royal Decree No. M/93 dated 15/08/1441H (8 April 2020).} 

^{[4] Law of Civil Procedure, Royal Decree No. M/1 dated 1/22/14 H (November 25, 2013).} 

^{[5] Law of Evidence, Royal Decree No. M/43 dated 26/5/1443H (December 30, 2021).} 

^{[6] Law of Judicial Fees, Royal Decree No. M/16 dated 30/1/1443H (September 7, 2021).} 

Attempting to resolve the dispute through negotiation or alternative dispute resolution

In many cases, it may be possible to resolve a legal dispute without going to court. This may involve negotiating a settlement with the other party or using alternative dispute resolution methods such as mediation or arbitration. There is a court sponsored amicable resolution service with a mediator should the parties accept this approach or wish for it. The CCL encourages the parties to explore alternatives such as reconciliation and mediation before resorting to the commercial courts, and, in some instances, makes it a prerequisite to being able to bring an action.^[7]

Assessing the potential costs and risks of legal action

Before initiating legal action, judges in the commercial courts expect litigants to have assessed the potential costs and risks involved. This may include considering the likelihood of success, the potential damages, or remedies available, and the costs of legal fees and other expenses such as court fees.

^{[7] Article 8 of the Commercial Courts Law, enacted under Royal Decree No. M/93 dated 15/08/1441H (8 April 2020) and Article 58-95 of the Implementing Regulations of the Commercial Courts Law.}

Arbitration and mediation

By the decision of the Saudi Council of Ministers in 2014, the Saudi Center for Commercial Arbitration (SCCA) was established to carry out ADR methods in commercial and civil disputes where parties agree to explore the services offered by the SCCA such as arbitration and mediation. When comparing between SCCA services, arbitration is the most used ADR method in Saudi Arabia. The SCCA provides ADR services in Arabic and English and its rules are based on Sharia principles and professional and international standards. For both domestic and international disputes, the SCCA has adopted the UNCITRAL Model Law and its services are delivered by a well-trained team in line with international best practice. By 2030, the SCCA aspires to be the preferred option for parties to resolve their dispute.^[7] In addition to the more formal ADR methods of arbitration and mediation, negotiation (without the use of a mediator) remains a common method for resolving commercial disputes in Saudi Arabia, particularly in cases where the parties have an ongoing business and wish to maintain a good working relationship.

^{[8] www.sadr.org/?lang=en}

The duration of commercial court proceedings in Saudi Arabia can vary widely. However, if there is no agreement between the parties regarding litigation procedures,^[9] the maximum time limits for adjudicating a case are as follows:

1. 180 days in cases brought before the court of first instance, except for minor cases.
2. 20 days in the case of objections to the appeal against the rulings that it is sufficient to consider the appeal without pleadings.
3. 90 days in objections to appeals against provisions not included in clause (B).^[10]

^{[9] Article 6 the Commercial Courts Law, enacted under Royal Decree No. M/93 dated 15/08/1441H (8 April 2020) and Article 9 of the Implementing Regulations of the Commercial Courts Law.}  

^{[10] Article 38 of the Implementing Regulations of the Commercial Courts Law.}

In general, the disclosure obligations in Saudi Arabia are governed by the Law of Evidence (EL). The parties to the commercial dispute are obligated to exchange and disclose all relevant documents in their possession or control.^[11] The court has the power to order parties to produce documents that are in their possession or control, even if those documents are not favourable to their case. This is known as the principle of “full and frank disclosure”, which requires parties to provide all information and documents that are necessary for a fair and just resolution of the dispute. The court in Saudi Arabia may also order the parties to provide additional disclosure beyond what is required by law if it deems it necessary for a fair and just resolution of the dispute. However, the court will balance the need for disclosure against factors such as the cost and burden of disclosure and the confidentiality of the information in question.

^{[11] Chapter 3 of the Law of Evidence.}

In general, witnesses can be required to attend trial in the commercial court in Saudi Arabia and face cross-examination. Chapter 3 of Part 5 of the EL provides for the examination of witnesses in court and allows the court to order witnesses to appear and testify at trial.^[12]

A party who claims to have witness evidence to support their case must notify the court of the number of witnesses they intend to rely on, the identity of the witnesses and the facts that each witness will speak to. Additionally, witnesses may be summoned to testify in writing in certain circumstances, such as when they are unable to attend the trial in person.^[13]

^{[12] Law of Evidence, Royal Decree No. (M/43) dated 26/5/1443H (December 30, 2021).}

^{[13] Chapter 3, Part 5 of the Law of Evidence, Royal Decree No. (M/43) dated 26/5/1443H (December 30, 2021).}

In Saudi Arabia, the court has broad discretion to make orders regarding costs in commercial disputes. When making such an order, the court will consider a range of factors, including the complexity of the case, the conduct of the parties, the success or failure of the claims or defences, and any other relevant circumstances. The party who applies for an order typically bears the cost of it. For example, the party who requests a deputation of an expert over a technical issue usually bears the cost of the expert. However, if that party wins, then they will be compensated by the losing party. The court may depart from this rule in certain circumstances, such as when the winning party has engaged in unreasonable conduct or when the case raises complex legal or factual issues. Article 122 of the EL states that “The litigant who loses the claim subject of the expert’s report shall incur the expert fees. If the loss is shared by the litigants, the share incurred by each litigant shall be to the extent of his loss. The court shall indicate such matter in the judgment issued on the subject-matter of the case”.^[14]

It is also worth noting that such orders have a set fee determined in the Law of Judicial Fees (JFL).^[15] The court in Saudi Arabia has the authority to award a range of different types of costs, including legal fees, court fees, expert witness fees, and other expenses incurred by the parties in connection with the dispute. Article 13 of the JFL states that “A person against whom a judgment is rendered shall bear all or part of the judicial fees prescribed for the case and related petitions unless this Law or its Regulations stipulate otherwise, without prejudice to the right of the concerned parties to seek compensation. If the plaintiff’s claim is partly invalid, he shall bear the share of the fees for the invalid part”. 

^{[14] Law of Evidence, Royal Decree No. (M/43) dated 26/5/1443H (December 30, 2021).}

^{[15] Law of Judicial Fees, Royal Decree No. (M/16) dated 30/1/1443H (September 7, 2021).}

Article 36 of the CCL provides for a range of interim remedies whereby parties can seek to protect their rights or interests during a commercial dispute, including the following: 

• inspection to verify an existing state; 
• travel ban;
• suspension of new actions;
• receivership;
• provisional seizure;
• collection of a sample of a product;
• seizure of certain documents;
• prevention or permission of disposition; 
• petitions deemed urgent under commercial laws.^[16]

It is worth noting that these types of petitions are usually fast tracked by the court and addressed within three days, and in some instances, they do not require the other party’s presence or prior knowledge. When required, a petition for interim remedies may be decided outside of regular business hours.^[17] More importantly, for the court to accept such a petition, it must be filed on a reasonable basis with a clear explanation. Also, the court may ask the party who seeks execution of the petition to deposit a security to protect the other party’s interest or rights if they are later proved to be innocent.^[18] 

^{[16] Article 36 of the Commercial Courts Law, enacted under Royal Decree No. M/93 dated 15/08/1441H (8 April 2020).} 

^{[17] Article 34 of the Commercial Courts Law, enacted under Royal Decree No. M/93 dated 15/08/1441H (8 April 2020) and Articles 105 - 107 of the Implementing Regulations of the Commercial Courts Law.}

^{[18] Article 37 of the Commercial Courts Law, enacted under Royal Decree No. M/93 dated 15/08/1441H (8 April 2020).} 

In recent years, Saudi Arabia has taken significant steps to modernize its legal system and promote alternative dispute resolution methods including arbitration. The country has enacted a comprehensive arbitration law, the Law of Arbitration (AL), which came into effect in 2012.^[19]

The AL in Saudi Arabia is based on the UNCITRAL Model Law, which is a widely recognized and widely used international framework for modern arbitration law. The adoption of the Model Law has helped to promote greater consistency and coherence in arbitration practice in Saudi Arabia and has facilitated the country’s integration into the international arbitration community.

In addition, the SCCA has become an important regional arbitration center that administers arbitrations in both Arabic and English. The current SCCA Rules, which came into force on 1 May 2023, incorporate a number of modern innovations and features inspired by the rules of other leading arbitration centers. A key addition in the 2023 Rules is the role given to the SCCA Court, a body formed in November 2022. Its role is similar to other successful international arbitral institutions, such as the International Chamber of Commerce. It is comprised of 15 recognised arbitration practitioners. Various decision-making functions, which under the previous rules were allocated to the SCCA as administrator, such as nominating arbitrators where the parties fail to do so on time, are now undertaken by the SCCA Court.

With respect to the approach of local courts in Saudi Arabia towards arbitration, the general trend has been to support and encourage the use of arbitration as an effective means of resolving disputes. The AL provides for a range of provisions to protect and promote the use of arbitration, including provisions on the validity and enforceability of arbitration agreements, the role of the court in supporting arbitration proceedings, and the recognition and enforcement of arbitral awards.

^{[19] Law of Arbitration, Royal Decree No. M/34 dated 5/24/1433H (April 16, 2012).}

Arbitrators in Saudi Arabia have the power to grant temporary relief based on the specifics of the dispute and the matter at hand. Article 23 of the AL states:

“1. The two parties to arbitration may agree that the arbitration tribunal shall, upon the request of either party, order either party to take, as it deems fit, any provisional or precautionary measures required by the nature of the dispute. The arbitration tribunal may require the party requesting such measures to provide a sufficient financial guarantee for the execution of such proceeding. 

2. If the party against whom the order has been issued fails to execute such an order, the arbitration tribunal may, upon the request of the other party, authorize said party to take necessary measures for its execution, without prejudice to the right of the arbitration tribunal or the other party to request the competent agency to enforce such order.”^[20]

^{[20] Law of Arbitration, Royal Decree No. M/34 dated 5/24/1433H (April 16, 2012).}

Under Saudi Arabian law, an arbitration award may only be challenged on very limited grounds. The grounds for challenging an arbitration award in Saudi Arabia are set out in Article 50 of the AL, and are as follows:

“1. An action to nullify an arbitration award shall not be admitted except in the following cases:

a) If no arbitration agreement exists, or if such agreement is void, voidable, or terminated due to expiry of its term.

b) If either party, at the time of concluding the arbitration agreement, lacks legal capacity, pursuant to the law governing his capacity.

c) If either arbitration party fails to present his defense due to lack of proper notification of the appointment of an arbitrator or of the arbitration proceedings, or for any other reason beyond his control.

d) If the arbitration award excludes the application of any rules which the parties to arbitration agree to apply to the subject matter of the dispute.

e) If the composition of the arbitration tribunal or the appointment of arbitrators is carried out in a manner that violates this Law or the agreement of the parties.

f) If the arbitration award rules on matters not included in the arbitration agreement. Nevertheless, if the sections of the award relating to matters subject to arbitration can be separated from those not subject thereto, then nullification shall apply only to the sections not subject to arbitration.

g) If the arbitration tribunal fails to observe the conditions required for the award in a manner that affects its substance, or if the award is based on void arbitration proceedings that affect it.

2. The competent court considering the nullification action shall, on its own initiative, nullify the award if it violates the provisions of Sharia and public order in the Kingdom or the agreement of the arbitration parties, or if the subject matter of the dispute cannot be referred to arbitration under this Law.

3. The arbitration agreement shall not terminate with the issuance of the competent court’s decision nullifying the arbitration award unless the arbitration parties agree thereon or a decision nullifying the arbitration agreement is issued.

4. The competent court shall consider the action for nullification in cases referred to in this Article without inspecting the facts and subject matter of the dispute.”^[21]

^{[21] Law of Arbitration, Royal Decree No. M/34 dated 5/24/1433H (April 16, 2012).}

Saudi Arabia is a party to several international conventions and agreements related to the enforcement of judgments or arbitral awards, including:

• The New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. This is the most widely recognized international agreement on the recognition and enforcement of foreign arbitral awards. However, Saudi Arabia has the following reservation: “On the Basis of reciprocity, the Kingdom declares that it shall restrict the application of the Convention to the recognition and enforcement of arbitral awards made in the territory of a Contracting State”.^[22]
• Riyadh Convention on Judicial Cooperation between States of the Arab League – Adopted 1406H – 1985G. This agreement was signed by several Arab states, including Saudi Arabia. It provides for the recognition and enforcement of judgments as well as arbitral awards.^[23]
• The 1995 Gulf Cooperation Council (GCC) Convention for the Execution of Judgments, Delegations and Judicial Notifications. This convention was signed by GCC countries. It provides for the enforcement of judgments and arbitral awards issued in the GCC.^[24]

It is important to note that while Saudi Arabia is a party to these international conventions and agreements, the enforcement of foreign judgments or arbitral awards in Saudi Arabia may still be subject to certain conditions and procedures under Saudi Arabian laws, such as the basis of reciprocity. 

^{[22] www.newyorkconvention.org/countries.}

^{[23] www.sadr.org/About-ADR.in.sa-History?lang=en.}

^{[24] GCC The Process and Achievements (https://shorturl.at/dnH25) and The GCC Convention for the Execution of Judgments, Delegations and Judicial Notifications (www.arbitrationlaw.com/sites/default/files/free_pdfs/GCC%20Convention.pdf).}

In Saudi Arabia, judgments in commercial matters are generally enforceable. However, there are some types of judgments in commercial matters that may be excluded from enforcement. For example, judgments that violate Saudi laws may not be enforced. Similarly, judgments that were obtained through fraud, corruption, or coercion may not be enforced. In addition, judgments that are not final or subject to appeal may not be enforced until the appeal process has been completed. That means a party may need to wait until obtaining an official permission from the court to enforce the judgment that is not yet final. The judgment becomes final once the execution stamp has been applied.

The process for registration of foreign judgments and arbitral awards in Saudi Arabia is governed by the Enforcement Law and its regulations.^[25] It is essential to keep in mind that only on the basis of reciprocity may the courts execute a foreign judgment or arbitral awards. The party who seeks enforcement shall bear the burden of establishing that the principle of reciprocity has been fulfilled.^[26] Moreover, The Ministry of Foreign Affairs and the Ministry of Justice in the Kingdom must verify the official documents issued by foreign governments. The court will only consider reviewing documents that have been translated by a licensed translation agencies because Arabic is the official language in Saudi Arabia.^[27] The court will additionally examine the judgment to see if the following requirements have been met:

• The courts of the Kingdom have no jurisdiction to review a dispute regarding which a judgment or order is issued, and that the foreign courts issuing such judgment or order have jurisdiction over it in accordance with rules of international judicial jurisdictions stated in their laws.
• The litigants of a lawsuit in which a judgment is rendered are summoned to appear, are duly represented, and are given the right to defend themselves.
• The judgment or order becomes final in accordance with the law of the court issuing it.
• The judgment or order is not in conflict with any other judgment or order issued on the same case by a competent judicial body in the Kingdom.
• The judgment or order is not in conflict with public order in the Kingdom.^[28]

This also applies to arbitral awards.^[29] It is important to note that the enforcement of foreign judgments and arbitral awards in Saudi Arabia may be subject to certain conditions and procedures and that the process for enforcement may vary depending on the specific circumstances of the case.

^{[25] Enforcement Law, Royal Decree No. M/53 dated 8/13/1433H, (July 3, 2012).}

^{[26] Article 11.6 of the Implementing Regulations of the Enforcement Law.}

^{[27] Article 11 of the Implementing Regulations of the Enforcement Law.}

^{[28] Article 11 of the Enforcement Law, Royal Decree No. M/53 dated 8/13/1433H, (July 3, 2012) and Article 11 of the Implementing Regulations of the Enforcement Law.}

^{[29] Article 12 of the Enforcement Law, Royal Decree No. M/53 dated 8/13/1433 H, (July 3, 2012).} 

Once the enforcement court approves the registration of foreign judgments and arbitral awards, after the fulfilment of the legal requirements, it will permit the execution of them. Pursuant to the Enforcement Law, the available methods of execution that can be pursued are as follows:

• Disclosure of assets. The enforcement judge will ask the party to fully disclose any property owned to repay the enforcement document.^[30]
• Provisional attachment. In certain situations, assets may be temporarily seized in order to prevent any attempts to sell, transmit, or dispose of them. Article 20 of the Enforcement Law states that: “All debtor’s assets shall guarantee his debts. Attachment of debtor’s assets shall invalidate any action by the debtor regarding his attached assets”.^[31] However, there are certain properties exempted from applying provisional attachment stated in chapter 4 of the Enforcement Law.^[32]
• Enforcement Proceedings. To pay off the judgment debt, seized property may be sold at auction. Any excess left from the sale will be given back to the party being enforced against.^[33]

^{[30] Chapter 3 of the Enforcement Law, Royal Decree No. M/53 dated 8/13/1433 H, (July 3, 2012).}

^{[31] Chapter 4 of the Enforcement Law, Royal Decree No. M/53 dated 8/13/1433 H, (July 3, 2012).} 

^{[32] Chapter 4 of the Enforcement Law, Royal Decree No. M/53 dated 8/13/1433 H, (July 3, 2012).} 

^{[33] Chapter 4/3 of the Enforcement Law, Royal Decree No. M/53 dated 8/13/1433 H, (July 3, 2012).}

Some examples of interim measures that are available in Saudi Arabia include:

• Freezing assets. The court may order the temporary freezing of assets owned by one or both parties in a dispute to prevent them from being sold, transferred, or otherwise disposed of before the final decision is made. 
• Prohibitory injunctions. The court may issue an injunction to prohibit a party from taking certain actions that could harm the other party’s interests, such as ceasing business operations or entering into contracts with other parties.
• Mandatory injunctions. The court may order a party to take a specific action that is necessary to prevent harm to the other party’s interests, such as continuing to supply goods or services or completing a contract as agreed.