Saudi Commercial Courts Law: An Overview
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The Commercial Courts Law sets out which judicial body has jurisdiction over commercial disputes in Saudi Arabia, and the general framework for how such a dispute proceeds from filing through to judgment and beyond. Knowing this framework in advance helps a business form a realistic picture of the path a commercial dispute may take before one arises.
Issuance and Scope
The Commercial Courts Law was issued under Royal Decree No. M/93 dated 15/8/1441H, corresponding to 8 April 2020, and its Article 16 was amended by Royal Decree No. M/191 dated 29/11/1444H. Under that article, the commercial court hears disputes between merchants arising from their original or ancillary commercial activity; claims brought against a merchant in commercial contract disputes where the original claim exceeds SAR 100,000, a threshold the Supreme Judicial Council may raise; disputes arising from partnership (musharaka) contracts provided for in the Civil Transactions Law; claims and violations arising from the application of the Companies Law, the Bankruptcy Law, the intellectual property laws and other commercial laws; and other matters the article lists.
Stages of a Commercial Case
For claims specified in the law's implementing regulations, the claimant must notify the defendant in writing to perform the claimed right at least fifteen days before filing, and conciliation or mediation may be required before the case is heard. The claim is then filed by a statement of claim lodged with the court; the competent department prepares the case by completing the file, notifying the parties and exchanging memoranda and documents, and the defendant files a defense memorandum at least one day before the scheduled hearing. Proceedings and pleadings are in writing as a rule, though the circuit may hear the parties orally, and the case ends in a judgment. A party against whom judgment is given, or whose claims were not granted in full, may appeal within thirty days of the date set for delivery of the judgment copy, or within ten days for rulings on jurisdiction and urgent matters. Small claims not exceeding SAR 50,000, as specified by the Supreme Judicial Council, are not appealable, and the parties may agree, even before filing, that the first-instance judgment will be final. The commercial circuit of the Supreme Court hears challenges to appellate rulings in the circumstances set out in Article 88.
Electronic Litigation
Article 7 of the law allows any procedure under it to be conducted electronically, including filing and registering claims and applications, hearing them, remote pleading, exchanging memoranda, judgment and challenge, with the implementing regulations setting out how.
When Early Legal Input on a Commercial Dispute Is Worth Getting
The value of the claim, the statutory deadlines for filing, responding, or appealing, and the documents each side can rely on all directly affect how a commercial dispute unfolds and how it is likely to end. Reviewing these factors with a specialist before taking a procedural step, rather than after, helps that step be taken on an informed basis. This is a general overview of the legal framework, not a substitute for a legal assessment of a specific dispute's facts.
Frequently asked questions
The Commercial Courts Law was issued under Royal Decree No. M/93 dated 15/8/1441H, corresponding to 8 April 2020. Its Article 16, which concerns the commercial court's jurisdiction, was amended by Royal Decree No. M/191 dated 29/11/1444H.
Under Article 16 of the law, the commercial court hears disputes between merchants arising from their original or ancillary commercial activity, and claims brought against a merchant in commercial contract disputes where the original claim exceeds SAR 100,000, a threshold the Supreme Judicial Council may raise. It also hears disputes arising from partnership (musharaka) contracts provided for in the Civil Transactions Law, and claims and violations arising from the application of the Companies Law, the Bankruptcy Law, the intellectual property laws and other commercial laws, alongside other matters the article lists.
Yes, for the claims specified in the law's implementing regulations, where the claimant must notify the defendant in writing to perform the claimed right at least fifteen days before filing. Conciliation or mediation may also be required before the case is heard.
The claim is filed by a statement of claim lodged with the court, and the competent department then prepares the case by completing the file, notifying the parties and exchanging memoranda and documents, while the defendant files a defense memorandum at least one day before the scheduled hearing. Proceedings and pleadings are in writing as a rule, though the circuit may hear the parties orally, and judgment is then issued.
The time limit for an appeal is thirty days from the date set for delivery of the judgment copy, and ten days for rulings on jurisdiction and in urgent matters. An appeal may be brought by a party against whom judgment is given, or whose claims were not granted in full. Small claims not exceeding SAR 50,000, as specified by the Supreme Judicial Council, are not appealable, and the parties may agree, even before filing, that the first-instance judgment will be final.
Yes, Article 7 of the law allows any procedure under it to be conducted electronically, including filing and registering claims and applications, hearing them, remote pleading, exchanging memoranda, judgment and challenge. The implementing regulations set out the procedures for this.