SAUDI ARABIA Law and Practice Contributed by: Zeyad Khoshaim, Abdullah Alajlan and Kamil Mehiz, Khoshaim & Associates
Under the SCCA framework, the arbitral tribunal can determine and allocate arbitration costs in its award. This includes the arbitrator’s fees and costs, the par - ties’ legal representation costs and fees as well as other related expenses. The arbitral tribunal can dis - tribute these costs among the parties at its discretion based on what it considers reasonable, taking into account factors like each party’s conduct and efforts to manage costs efficiently (Article 40 (1) of the 2023 SCCA Rules). Arbitral awards cannot be appealed before Saudi courts. Instead, they can only be contested by filing an action to nullify the award within 60 days from the date of its notification to the parties (Article 51 (1) of the Saudi Arbitration Law). If a Saudi court issues a judgment annulling an arbitral award, this decision can be appealed to the Saudi Supreme Court within 30 days of notification, as per Article 51 of the Saudi Arbitration Law and Article 17 of its Implementing Regulations. 11. Review of an Award 11.1 Grounds for Appeal The Saudi Arbitration Law provides an exhaustive list of grounds for annulling an arbitral award. Under Arti - cle 50 of the Saudi Arbitration Law, an award will only be annulled if: • there is no arbitration agreement, or if it was void or voidable, or if its duration had lapsed; • either party to the arbitration agreement was, at the time of the conclusion of the arbitration agreement, fully or partially incapacitated, according to the law governing said person’s legal capacity; • either party to the arbitration was unable to present its case due to not receiving proper notice of the arbitrator’s appointment or the arbitral proceed - ings, or for any other reason beyond the party’s control; • the arbitral award excluded the application of any rules agreed upon by the parties that ought to gov - ern the subject matter of the dispute; • the composition of the arbitral tribunal or the appointment of arbitrators was carried out in a
manner that conflicts with the Saudi Arbitration Law or the parties’ agreement; • the arbitral award ruled on matters not included in the arbitration agreement or exceeded the limits of that agreement. However, if the issues within the scope of the arbitration can be separated from those not included, the annulment will only affect the latter parts; or • the arbitral tribunal fails to meet the necessary conditions for the award, thereby affecting its sub - stance, or if the award is based on void arbitration proceedings. Additionally, the competent court in the Kingdom hearing a case for annulment shall annul the award on its own initiative if it concludes either that (i) the award violates provisions of Shari’ah law and public policy in the Kingdom; (ii) the award violates the arbitration agreement; or (iii) the subject matter of the dispute cannot be referred to arbitration as clarified in Article 2 of the Saudi Arbitration Law. 11.2 Excluding/Expanding the Scope of Appeal The parties cannot alter the scope of challenge to an arbitral award, as Article 50 of the Saudi Arbitration Law provides an exhaustive list of grounds for annul - ment. However, they may waive their right to seek annulment after (but not before) the award has been issued (see Article 51 (1) of the Saudi Arbitration Law and Article 18 (1) of its Implementing Regulations). Article 7 of the Saudi Arbitration Law states that if a party continues with the arbitration after becoming aware of a violation of the arbitration agreement or the Arbitration Law (in matters that can be agreed other - wise by the parties), and does not raise an objection before the tribunal within either (i) the agreed time - frame, or (ii) 30 days of discovering the violation, then that party is deemed to have waived the right to make this objection later. Therefore, to use such violations as grounds for annulment before the Saudi courts, the party must have addressed them promptly during the arbitration process. 11.3 Standard of Judicial Review Under Saudi law, a Saudi courts’ review of an award focuses solely on the legality of the arbitral award, not
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