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Ramadan likely for delayed Saudi civil code

The new Saudi civil code is intended to reassure international businesses they can confidently trade in the kingdom Pexels/Vlada Karpovich
The new Saudi civil code is intended to reassure international businesses they can confidently trade in the kingdom
  • New code aimed to clarify laws
  • Designed for international business
  • Intended to be in place last year

Saudi Arabia’s much-anticipated new civil code has yet to come into effect, with industry figures estimating the deadline for implementation has shifted to the beginning of the fasting month of Ramadan in March.

The regulations were published last June ahead of a planned cabinet decree that would formalise them as legal practice by the end of 2023.

“It’s been delayed, apparently, so we are just waiting,” said a lawyer from a European legal firm who declined to be named, pointing to Ramadan as the timeframe observers now have in mind. The Islamic lunar month is due to start around 10 March. 

A Saudi lawyer who has been privy to the discussions declined to comment. 

The government hopes the law will finally provide foreign investors with clarity on doing business in the kingdom as it tries to shake off a reputation for opaque and arbitrary justice and push annual foreign direct investment towards a target of $100 billion by 2030.

The code’s 721 articles lay down statutory requirements for judges to follow in a wide range of issues including real estate and tort, rather than traditional Islamic principles that give them free rein in interpreting the law and no cause to follow recent precedent. 

Delays in implementing laws, which are usually issued via cabinet-approved royal decree, are not unusual in Saudi Arabia, where bureaucratic sloth has often held up legislation. But they can also be a sign of dissent among key constituencies. 

Following practice in other Gulf countries, the new rules mean that foreign companies will be able to take commercial cases to an arbitration court operating in English, rather than the Saudi grievances court, although it will also be subject to the civil code. 

In advance of the code, a range of global law firms have opened offices in the kingdom over the past year.

The most recent was Norton Rose Fulbright, which said last month it had been granted a foreign law firm licence by the Ministry of Justice. 

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