Arbitration in Saudi Arabia has undergone a remarkable transformation, establishing itself as a cornerstone of commercial dispute resolution in a jurisdiction historically rooted in Sharia law. In line with Vision 2030, the Kingdom continues to promote arbitration to enhance legal predictability, attract foreign investment, and align with global standards. This article examines the latest trends and best practices in Saudi arbitration, offering guidance to investors, legal practitioners, and businesses operating in or with the Kingdom.
A Modern Legal Framework Anchored in Reform
The Saudi Arbitration Law (2012), modelled after the UNCITRAL Model Law, remains the legal foundation for arbitration in the Kingdom. It brought a paradigm shift by affirming party autonomy, competence-competence, separability of the arbitration clause, and finality of awards, subject to compliance with Saudi public policy and Sharia.
The Enforcement Law of 2012, complemented by the specialised Enforcement Courts, has improved the efficiency and predictability of arbitral award recognition and enforcement. As of 2025, the Saudi courts increasingly demonstrate a pro-enforcement orientation, including for foreign awards, provided procedural integrity is maintained and public policy is not violated.
Recent court decisions (2023–2025) have further clarified ambiguities surrounding enforcement timelines, the role of public policy, and the validity of foreign-seated arbitrations, reinforcing Saudi Arabia’s commitment to modern dispute resolution.
The Role and Maturation of the Saudi Center for Commercial Arbitration (SCCA)
Since its establishment in 2014, the Saudi Center for Commercial Arbitration (SCCA) has grown into the Kingdom’s leading arbitration institution, playing a central role in advancing dispute resolution in line with international standards. The revised 2023 SCCA Arbitration Rules introduced several modern features, including expedited proceedings, emergency arbitration, virtual hearings, online case filing, bifurcation and consolidation procedures, and greater transparency in arbitrator appointments. These enhancements reflect the SCCA’s commitment to efficiency, fairness, and procedural innovation.
The SCCA continues to expand its presence and capabilities. In early 2025, it opened a branch in NEOM, reinforcing its alignment with the region’s vision as a futuristic commercial and innovation hub. The launch of the SCCA Court, an independent body composed of prominent international arbitration professionals to oversee case administration, marked another milestone in the institution’s maturation. Furthermore, in 2024, the SCCA began administering investor-state disputes under tailored rules, reinforcing Saudi Arabia’s broader strategy to attract and protect foreign direct investment by offering robust legal certainty.
Trends: Harmonisation with International Norms
Saudi Arabia’s arbitration environment continues to strike a careful balance between localisation and globalisation. While Sharia compliance remains a foundational element, Saudi courts are increasingly pragmatic in their interpretation of public policy, particularly in commercial matters. The Kingdom’s commitment to the New York Convention, in effect since 1994, remains strong, and recent decisions by the Enforcement Courts reflect a growing deference to international arbitral standards.
Arbitration clauses that reference institutional rules such as those of the SCCA, ICC, or LCIA with seats in Riyadh, Jeddah, or even foreign jurisdictions are increasingly recognised and enforced by Saudi courts. This trend is particularly evident in sectors such as construction, infrastructure, energy, and technology, where arbitration is becoming the preferred method of dispute resolution. These developments are closely linked to the Kingdom’s Vision 2030 initiatives, including megaprojects like The Line, Qiddiya, and Diriyah Gate, which demand sophisticated, reliable, and enforceable dispute resolution mechanisms.
Best Practices for Arbitration in Saudi Arabia
To effectively navigate arbitration in Saudi Arabia, parties should observe the following best practices:
- Draft Robust Arbitration Clauses
Clearly specify the arbitration institution (e.g., SCCA), seat of arbitration, governing law, procedural rules, and language. Avoid vague or conflicting terms. - Appreciate Sharia and Public Policy Parameters
While modern in form, Saudi arbitration law remains anchored in Islamic law. Ensure that the dispute is arbitrable and the subject matter does not contravene core Sharia principles. - Use Bilingual Documentation When Necessary
Arabic remains the official language of the courts. While SCCA and other institutions operate bilingually, translating key documents into Arabic can avoid delays in enforcement or recognition. - Select Arbitrators with Regional and Sectoral Expertise
Consider arbitrators with strong knowledge of both international arbitration and Saudi law or regional practice. This can help avoid procedural missteps and align expectations with local sensitivities. - Leverage Digital Tools and Institutional Platforms
The SCCA’s digital case management system allows for seamless filing, hearings, and document exchange. Utilising these tools can significantly enhance efficiency, especially in complex disputes.
Challenges and Opportunities Ahead
Despite marked progress, challenges persist in the Saudi arbitration landscape. Public policy exceptions can still be unpredictably interpreted by courts, particularly in cases involving interest (riba) or vague contract provisions. Additionally, the discretion afforded to domestic judges during the enforcement phase remains a concern for some parties, especially those unfamiliar with the nuances of Sharia-based legal interpretation.
However, these concerns are increasingly being addressed through consistent judicial guidance and greater transparency in SCCA-administered proceedings. The growing presence of licensed foreign law firms in Saudi Arabia, which has expanded significantly since 2023, has also contributed to enhanced legal sophistication and international best practices. Furthermore, ongoing reforms focused on judicial training, alternative dispute resolution mechanisms, and increased private sector engagement continue to strengthen the Kingdom’s arbitration framework and its global credibility.