Introduction to the SCCA’s report

On 1 July 2026, the Saudi Center for Commercial Arbitration (SCCA) published a comprehensive country report on arbitration in Saudi Arabia, prepared in response to an official invitation from the UNCITRAL Board of Editors for the revision of the Digest of Case Law on the Model Law. The report is the most authoritative and comprehensive data-driven analysis of the Saudi arbitration framework yet produced, drawing on a dataset of 967 judicial decisions from the Courts of Appeal between January 2023 and June 2025, and a cumulative body of over 3,300 judgments issued since 2017.

For international practitioners, in-house counsel, and businesses operating in or connected to the Kingdom, the report’s significance is threefold. First, it provides empirical evidence to address what has long been the primary concern among international users of Saudi-seated arbitration: the risk that awards will be annulled on grounds of public policy or Sharia. The data is now unequivocal – that risk is minimal. Second, it documents a judicial culture that has matured rapidly, with Saudi appellate courts consistently confining their review to the narrow procedural grounds prescribed by Article 50 of the Saudi Arbitration Law of 2012 and refusing to re-examine the merits of awards. Third, it signals the direction of legislative reform through its detailed analysis of the Draft Arbitration Law, published for public consultation at the end of 2025, which brings Saudi Arabia closer to full harmonisation with the UNCITRAL Model Law than any previous iteration of the Kingdom’s arbitration regime.

This client alert identifies the key findings from the SCCA’s report and explains what they mean in practice for parties, advisers, and institutions engaged in Saudi-seated arbitration.

The judicial track record

The question most frequently asked by international users considering a Saudi seat is straightforward: will the award survive?

Of the 967 judicial decisions analysed in the 2023–2025 study period, 194 annulment applications were filed – representing approximately 20% of cases. Of those, 174 were rejected outright, yielding an 89.7% rejection rate. Only 20 applications succeeded: 12 resulted in full annulment (6.2% of applications filed) and eight in partial annulment (4.1%).

These figures are consistent with, and in many respects better than, those reported in established Model Law jurisdictions. They also align with the findings of the 2025 Reed Smith International Arbitration Report, which, based on a comparative analysis of leading arbitral seats worldwide, concluded that applications to set aside arbitral awards are overwhelmingly unsuccessful across jurisdictions and confirmed that the Middle Eastern jurisdictions surveyed (including the UAE and Bahrain) exhibited some of the lowest success rates for annulment applications internationally.

The cumulative picture for Saudi Arabia, drawn from over 3,300 judgments between 2017 and 2025 across five SCCA studies, is equally telling. Of 565 annulment applications in that period, 518 were rejected (91.7%). Full annulment was granted in just 31 cases (5.5%) and partial annulment in 16 (2.8%). The trend, moreover, is one of improvement: the rejection rate has risen steadily over the years.

For practitioners drafting arbitration agreements, these statistics provide an empirical foundation for recommending Saudi Arabia as a seat.

The scope and limits of judicial review

The report documents a mature judiciary that has internalised the principle of limited court intervention in arbitration. Several features of the Saudi judicial approach emerge from the case law.

No merits review. The Courts of Appeal have consistently held that they have no power to re-examine the substantive findings of an arbitral tribunal. Errors in the interpretation or application of law, and errors in the assessment of facts or evidence, do not constitute grounds for annulment under Article 50. 

Exhaustive annulment grounds. The grounds for annulment under Article 50 are treated as an exhaustive list. Courts do not entertain applications based on grounds not enumerated in the statute. This mirrors the approach taken in leading Model Law jurisdictions.

Competence-competence and separability. The report confirms clear alignment with the competence-competence doctrine. Tribunals have primary authority to rule on their own jurisdiction, and arbitration clauses survive the invalidity of the underlying contract. 

Party autonomy respected. Courts uphold party autonomy in the constitution of tribunals and the selection of procedural rules, including institutional rules. Intervention occurs only where necessary to safeguard procedural fairness – for example, where one party has unilaterally appointed the entire tribunal in breach of the agreed procedure. 

Arbitration-friendliness. Courts respect the parties’ choice of arbitration. Accordingly, where a dispute is brought before a court in breach of an arbitration agreement, the court will typically dismiss the proceedings if the defendant timely objects to the court’s jurisdiction pursuant to the arbitration agreement.

Procedural modernisation. The judiciary has embraced procedural modernity, affirming the validity of electronic notifications by text message, mobile applications, and email. The evidential burden has shifted to the recipient to demonstrate non-receipt, rather than requiring the sender to prove delivery through traditional means.

Public policy and Sharia as grounds for annulment: Perception vs the data

International parties have historically perceived Sharia and public policy as unpredictable bases upon which Saudi courts might overturn awards. The data paints a different picture.

In the 2023–2025 study period, Sharia formed the basis for a partial annulment in just one case out of 194 applications – a rate of 0.5%. Even in that single case, the court also relied on public policy and other procedural grounds; Sharia was not the sole basis for the decision. More broadly, public policy was successfully invoked in only three cases (1.55%), and in each instance the annulment was grounded in identifiable procedural defects rather than any broad or unpredictable application of Islamic legal principles.

Over the cumulative eight-year period (2017–2025), Sharia and public policy together accounted for annulment in only 13 cases out of 565 applications – a rate of 2.3%. The grounds, where identified, are both narrow and predictable:

• Retroactive application of limitation periods in conflict with settled public policy
• Recognition of unregistered leases contrary to a Council of Ministers decision
• Award of delay penalties amounting to interest (riba) prohibited under Sharia
• Award of arbitration fees without a party’s request (held to violate both Sharia and public policy)

Practically speaking, it is difficult to annul arbitral awards on the basis of non-compliance with Sharia principles, given that Sharia is subject to differing interpretations across various schools of Islamic jurisprudence. As a result, there is rarely unanimous scholarly consensus as to whether a particular issue constitutes a breach sufficiently clear to render an arbitral award incompatible with Sharia.

Overall, Sharia and public policy are not being deployed as tools to undermine awards on unpredictable grounds. They operate narrowly and in circumstances that experienced practitioners can anticipate and manage. 

The Draft Arbitration Law

The second part of the SCCA’s report undertakes a textual comparison between the UNCITRAL Model Law, the Saudi Arbitration Law of 2012, and the Draft Arbitration Law published for public consultation at the end of 2025. The Draft represents a significant and deliberate step towards fuller harmonisation with the Model Law, while retaining features adapted to the Saudi legal context. The following reforms are of particular significance for practitioners.

Arbitrator eligibility and immunity

The Draft removes the requirement that a sole arbitrator or presiding arbitrator hold a degree in Sharia or law – a change that will significantly expand the pool of available arbitrators for international disputes. The nationality requirement is also removed unless the parties expressly agree otherwise. Perhaps most notably, Article 27 of the Draft introduces express codification of arbitrator immunity (save in cases of fraud or gross misconduct), aligning Saudi Arabia with the approach in England, France, Singapore, and other leading seats.

Emergency arbitrators and interim relief

The Draft provides express statutory recognition of emergency arbitrators for the first time, and expands the framework for interim and precautionary measures – including measures to preserve the status quo, prevent harm, and safeguard assets or evidence. Where a party fails to comply with interim measures, the other party may seek recourse to the competent court, which must rule within 15 days. This fills a gap that has long been identified by institutional users and aligns the Saudi framework with modern best practice.

Multi-party disputes, multi-contract disputes, and procedural flexibility

The Draft introduces provisions for joinder, intervention, and consolidation of related arbitrations – mechanisms which the current law does not address and which are essential for complex commercial disputes involving multiple contracts or parties. Equally significant is the removal of the default 12-month time limit for tribunals to render a final award, which has been a source of difficulty in large-scale arbitrations under the current regime.

Modernised enforcement and annulment

The Draft introduces several reforms designed to strengthen the enforceability and finality of awards:

• Courts may stay annulment proceedings for up to 60 days to allow the tribunal to cure defects – a remission mechanism drawn from Article 34(4) of the Model Law.
• The requirement to deposit the award with the court before enforcement is removed.
• Appeals are permitted against both orders granting and refusing enforcement (currently only annulment orders are appealable).
• The Supreme Court is expressly designated as the appellate authority, and the Commercial Court of Appeal is given jurisdiction over annulment applications.

Digital proceedings and procedural modernisation

The Draft codifies electronic service of process (by email or mobile phone), expressly authorises virtual hearings, and permits electronic signatures on awards. Awards are deemed rendered at the seat even where signed elsewhere. These provisions reflect what is already common practice among institutions such as the SCCA, but their statutory codification removes any residual uncertainty and provides a clear legal foundation for fully digital arbitral proceedings.

Practical implications for parties and advisers

The cumulative effect of the SCCA’s findings, and the legislative trajectory signalled by the Draft Law, gives rise to a number of practical considerations for parties and their advisers.

• Seat selection. For disputes connected to the Kingdom, a Saudi seat offers an enforcement-friendly judiciary, a well-developed institutional framework through the SCCA, and a legislative environment that is converging with international best practice.
• Drafting arbitration agreements. The case law confirms the importance of precision in arbitration agreements. The instances of successful annulment are instructive: they arise predominantly from procedural defects in tribunal constitution, defective service, or awards addressing matters outside the scope of the agreement. Well-drafted clauses with clear scope, proper appointment mechanisms, and robust notification provisions will further minimise residual annulment risk.
• Managing the Sharia interface. While the data demonstrates that Sharia-based annulment is exceedingly rare, the prudent course remains to avoid structuring claims for relief that engage well-known Sharia prohibitions – principally the prohibition on riba (interest).
• Preparing for the new law. While draft laws are still subject to change prior to enactment, parties and institutions should begin familiarising themselves with the Draft Law’s new mechanisms.

Conclusion

The SCCA’s country report confirms that Saudi Arabia’s arbitration framework has come of age. The judiciary is sophisticated, restrained, and predictable. The legislative framework is evolving towards fuller harmonisation with international standards. And the institutional infrastructure – anchored by the SCCA – is well-placed to support the growing volume of domestic and international arbitration in the Kingdom.

Businesses and practitioners should be taking the following steps:

• Revisit existing arbitration clauses in contracts connected to Saudi Arabia to ensure they reflect current best practice and take advantage of institutional administration.
• Monitor the legislative process for the Draft Arbitration Law and participate in any further public consultation.
• Update dispute resolution policies and internal guidance to reflect the demonstrated reliability of Saudi-seated arbitration.
• Consider the Kingdom as a viable seat, given the strength of the empirical record and the direction of reform.

The report’s conclusion captures the trajectory well: Saudi Arabia has moved from national adaptation of the Model Law to “a more advanced phase of integration and harmonisation with the global arbitration framework.” The data bears this out. For parties operating in or connected to the Kingdom, the message is clear: Saudi-seated arbitration is a mature, reliable, and increasingly attractive option.

Client Alert 2026-142