Saudis move to modernise legal system

The legal overhaul will lead to the creation of a supreme court, appeals court and a general courts system to replace the Supreme Judicial Council. Observers believe the measures will help the economic reform process as well as improve civil liberties.

Economy opening up

The moves reflect the need of the kingdom's legal system to match the requirements of a growing economy that is steadily opening up to the outside world, according to Mufleh Al Qahtani, Dean of Civil Law at Riyadh's King Saud University.

At present, civil proceedings that involve claims against the government as well as enforcement of foreign judgements are heard before special administrative tribunals. The latter include the Commission for Settlement of Labour Disputes and the Board of Grievances.

Commercial courts will now handle disputes previously handled by Ministry of Commerce and Industry committees. Labour courts similarly are to look after disputes previously referred to the Ministry of Labour.

The new supreme court will assume the functions of the present Supreme Judicial Council - up to now the kingdom's highest legal tribunal. In future the council is to focus on administration which will include the selection of judges, the setting up of tribunals and other specialist courts with the king's approval.

A higher court is to be established to examine cases involving administrative appeals courts. There are also to be administrative courts to handle disputes involving the rights of employees, compensation, contracts, disciplinary issues, administrative decisions and the implementation of foreign regulations.

The Board of Grievances that handles administrative disputes involving government departments is to work as an independent body and be directly answerable to the king.

More professional and transparent

Implementation of a more professional system is expected to help clear a backlog of cases. While there is no codification of laws involved, the reformed system is considered likely to make arbitrary judgements less likely than in the past and the system more transparent.

An official website has also been launched to publish Islamic legal rulings, or fatwas, to make sure those issued by recognised scholars are given prominence. Questions can also be put to the site on various legal points for replies from the Council of Senior Ulema (Islamic scholars).
While the overhaul is far reaching further legal reform is expected. The head of the supreme court will be appointed by the king and is likely to reflect the latter's reformist instincts.

The biggest challenge for investors in Saudi Arabia is contract enforcement. A legal system able to ensure this is vital for a sound investment climate. Up to now, commercial disputes have been handled in religious courts.

According to Michael Klein, the World Bank's VP for Financial and Private Sector Development, bankruptcy legislation as well as shareholder protection and rules governing access to credit are also areas requiring legal reform.

See also:
Saudi reforms boost foreign investment