SAUDI ARABIA Trends and Developments Contributed by: Zeyad Khoshaim, Abdullah Alajlan, Kamil Mehiz and Sarah Sedky, K&A
Saudi Arabia’s Arbitration Regime in Transition: From Procedural Reform to Enforcement-Driven Outcomes Introduction Saudi Arabia’s arbitration framework is undergoing a calibrated and consequential transformation that mirrors the Kingdom’s broader legal and economic evolution. This transformation is not driven by a sin - gle legislative intervention, but by the convergence of two distinct yet interdependent developments that together are poised to reshape both the conduct of arbitral proceedings and the execution of arbitral out - comes within the Kingdom. On the procedural plane, the Draft Arbitration Law issued on Rabi’ al-Akhir 1447H (corresponding to October 2025 AD) (the “Draft Arbitration Law”), which remains in draft form and has not yet entered into force, signals a clear legislative intent to modernise the Saudi arbitration framework. It seeks to reduce proce - dural formalism, expand party autonomy, strengthen tribunal authority and align the Kingdom’s arbitration regime more closely with prevailing international best practices. In parallel, the Enforcement Law of 2026 issued pursu - ant to Royal Decree No M/237 (the “2026 Enforcement Law”) introduces a fundamental reconfiguration of the execution landscape. Characterised by enhanced enforcement powers, increased institutional integra - tion, and a more proactive approach to asset identifi - cation and recovery, the new regime reflects a signifi - cant departure from the creditor-driven mechanisms that historically characterised enforcement proceed - ings in the Kingdom. These developments emerge against the backdrop of Saudi Arabia’s continuing economic transformation. The growth of foreign direct investment, the prolifera - tion of public-private partnerships, the development of large-scale infrastructure and giga-projects, and the increasing sophistication of cross-border commercial activity have all contributed to a marked increase in the complexity and value of disputes arising within the Kingdom. As commercial activity evolves, so too do expectations regarding the efficiency, predictability and enforceability of dispute resolution mechanisms.
Viewed collectively, the Draft Arbitration Law and the 2026 Enforcement Law reveal a broader legislative evolution. Saudi Arabia is no longer focused solely on enhancing the procedural framework for arbitration; it is increasingly concerned with ensuring that arbitral awards can be enforced efficiently and translated into meaningful commercial outcomes. Together, these reforms reflect the emergence of a more integrated dispute resolution ecosystem in which procedural integrity, enforceability and practical effectiveness operate in tandem. The 2012 Baseline: Modernisation of the Arbitration Framework With Structural Constraints The enactment of the Saudi Arbitration Law in 2012 pursuant to Royal Decree No M/34, together with its Implementing Regulations (the “2012 Arbitration Framework”), marked a defining moment in the evo - lution of the Kingdom’s dispute resolution landscape. Drawing extensively on the UNCITRAL Model Law, the 2012 Arbitration Framework brought Saudi Arabia into closer alignment with leading international arbitration jurisdictions and established a modern legal frame - work governing arbitral proceedings and the recogni - tion and enforcement of arbitral awards. The significance of the 2012 Arbitration Framework should not be understated. It represented a substan - tial shift in the Kingdom’s approach to dispute resolu - tion and laid the foundations for the growth of arbi - tration as a preferred mechanism for resolving both domestic and international commercial disputes. By enhancing legal certainty, reducing judicial interven - tion, and strengthening the enforceability of arbitral awards, the reforms increased confidence among investors, businesses and commercial counterparties operating within the Kingdom. The 2012 Arbitration Framework introduced sev - eral principles that remain central to Saudi arbitra - tion today. It recognised the autonomy of the arbitral process through the doctrines of separability and kompetenz-kompetenz (competence-competence), strengthened the enforceability of arbitration agree - ments, and significantly curtailed judicial intervention by confining court involvement to defined supervisory functions. It also reinforced the finality and enforce - ability of arbitral awards through a structured annul -
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