SAUDI ARABIA Law and Practice Contributed by: Zeyad Khoshaim, Abdullah Alajlan and Kamil Mehiz, Khoshaim & Associates
• The court reviews the request within one to three days to assess procedural aspects and refer it to an enforcement judge. • The enforcement judge issues an order within three to five days, requiring compliance within five days (see Enforcement Law, Article 34 and Article 46). • If the debtor cannot be notified of the enforcement order within 20 days of its issuance, the enforce - ment judge will immediately order publication of the order in the most widely circulated newspaper in the area of the court. The debtor will eventually incur the cost of such publication (approximately USD100) in addition to the debt (see Enforcement Law, Article 34). • If the debtor does not voluntarily comply with the enforcement order, the enforcement court shall then order measures such as bank account attach - ment, travel bans, or suspension of the commercial register. These actions can be taken five days after the debtor is notified of the order or, if notifica - tion is not possible, five days after the order is published in a newspaper (see Enforcement Law, Article 46). Enforcement When Annulment Proceedings are Commenced Article 54 of the Saudi Arbitration Law specifies that filing a request for annulment does not automatically suspend the execution of the arbitral award. However, the court can grant a stay of execution if requested by a party, provided the request is based on “sound grounds”. The court must make a decision on the stay within 15 days of receiving the petition and may require a bail or financial guarantee. If a stay is granted, the court will decide on the annulment action within 180 days from the date of the stay order. Under Article 55 of the Saudi Arbitration Law: • a petition for enforcement will not be accepted before the deadline for filing a request for annul - ment has passed. The court will issue an order for enforcement only after verifying that: (a) the award does not conflict with any existing court judgments in Saudi Arabia; (b) the award does not violate Shari’ah or the pub - lic policy of the Kingdom of Saudi Arabia. If the award contains both violating and non-violating
parts, only the parts that do not violate these principles may be enforced; and (c) the award was properly notified to the party against whom it was rendered; • an order granting enforcement cannot be appealed, but an order denying enforcement can be appealed within 30 days; and • in practice, a competent court would not issue an order declaring the award enforceable until the request for annulment is resolved (usually one decision is issued where the court (i) rejects the annulment request, and (ii) declares the award enforceable). Foreign Awards and Annulment Proceedings Pending at the Seat A foreign arbitral award that has been set aside in the jurisdiction where it was issued will usually not be enforced in Saudi Arabia as long as such award is not considered a final award as per the applicable law in the jurisdiction. If annulment proceedings are ongoing at the seat (and the award is not deemed final in accordance with applicable law in the jurisdiction where it was issued), the Saudi Enforcement Court will reject enforce - ment as such award does not satisfy a condition for enforcement of foreign awards as per Article 11 of the Enforcement Law. Special Cases Against Saudi State or Saudi Governmental Entity If the award pertains to a commercial transaction with the Saudi state or a Saudi government entity, enforce - ment proceedings must be commenced before the specific Administrative Courts (the BoG) (see Law of Enforcement before the Board of Grievances issued pursuant to Royal Decree No (M/15) dated 27/01/1443H (04 September 2021G)). The enforce - ment judge may not issue enforcement against pub - licly owned assets. 12.3 Approach of the Courts Saudi Arabian courts are generally pro-enforcement regarding arbitral awards. They strictly adhere to the specified grounds for annulment and typically inter - pret the public policy ground narrowly.
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