SAUDI ARABIA Law and Practice Contributed by: Saud AlRomi, Mostafa Ihab and Saleh Elbadry, Mohammed AlDhabaan & Partners Eversheds Sutherland
all fruits received or negligently not received from the date bad faith began, meaning gains generated from invested fraud proceeds are also recoverable. Mixed Funds Once fraud proceeds are mixed with legitimate funds, the position becomes more difficult. Saudi civil law does not provide a tracing mechanism for mixed assets. However, under Article 33 of the Anti-Money Laundering Law, upon conviction for a money laun - dering or predicate offence, the court must order con - fiscation of proceeds of crime, including proceeds intermingled with funds from legitimate sources, up to the value of the intermingled proceeds – provid - ing a practical criminal law alternative where criminal proceedings are underway. 1.6 Rules of Pre-Action Conduct Saudi law does not prescribe formal pre-action con - duct rules specific to fraud claims. A fraud victim may file a civil claim before the competent court or a crimi - nal complaint before Nazaha, the public prosecution or the police, as the case may be, without any prior notice to the defendant. 1.7 Prevention of Defendants Dissipating or Secreting Assets Criminal Route A fraud victim may file a criminal complaint with the public prosecution or the police, which triggers broad investigative and asset preservation powers that the victim cannot access directly through civil proceed - ings. Once a complaint is filed, the public prosecution may, under Article 80 of the Criminal Procedure Law, search premises and seize items used in or resulting from the commission of a crime pursuant to a search warrant. Under Article 57 of the Criminal Procedure Law, the head of the public prosecution may order the seizure of correspondence, publications and packages, and authorise the monitoring and record - ing of telephone conversations if useful for solving the crime. Under Article 85 of the Criminal Procedure Law, where the investigator has evidence that a per - son holds items relevant to the investigation, they may seek an order for delivery of those items. Under Article 58 of the Implementing Regulations of the Criminal Procedure Law, the public prosecution may freeze bank accounts and balances.
In cases where fraud proceeds are involved, the Anti- Money Laundering Law provides additional powers. Under Article 44, the public prosecution may order provisional seizure of funds that may become subject to confiscation for up to 60 days, ex parte and without prior notice. Under Article 45, the public prosecution may issue search warrants to seize funds, proper - ties and documents relating to a predicate offence or money laundering crime, also ex parte. These powers represent the most powerful asset preservation tools in the fraud context. Civil Route – Summary Proceedings Except where the dispute falls within the jurisdiction of the commercial courts, a claimant may seek asset preservation through summary proceedings under Articles 205 and 206 of the Civil Procedure Law, which provide for urgent provisional measures – including provisional seizure and injunctions against interfer - ence with possession – where the lapse of time may affect the outcome. Where the dispute falls within the jurisdiction of the commercial courts, Article 36 of the Law of Com - mercial Courts provides for summary relief, includ - ing provisional seizure, seizure of certain documents, prevention or permission of disposition, travel ban and receivership. Under Article 37 of the Law of Commer - cial Courts, the court may require the claimant to pro - vide a security to indemnify the defendant if the claim The primary pre-judgment asset preservation mecha - nism available to a civil claimant is provisional attach - ment under the Enforcement Law. Under Article 23 of the Enforcement Law, provisional attachment is con - ducted as summary proceedings by the competent authority adjudicating the dispute. Where a substan - tive claim is already filed, that authority has jurisdiction to issue the attachment order under Article 30. Where no substantive claim exists yet, the claimant may file the attachment petition and must then institute a sub - stantive claim within ten days under Article 31 – failing which the attachment is void. Under Article 24 of the Enforcement Law, the grounds for provisional attachment are that the debtor has is found to have no merit. Provisional Attachment
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