JEDDAH: The commercial arbitration process in Saudi Arabia has undergone a full transformation in recent years, with advances likely to help increase foreign direct investment, as the government aims to attract hundreds of international organizations to set up regional headquarters in the Kingdom, a legal expert told Arab News.

According to a study by the Saudi Center for Commercial Arbitration (SCCA), the Kingdom’s commercial alternative dispute resolution (ADR) ecosystem has changed a lot in the last decade, improving how businesses operate and access justice in the country.

ADR is any means of settling commercial disputes, where negotiation has failed, without going to court. It includes options such as mediation, arbitration and conciliation. ADR is also seen as a quick and cost-efficient resolution of disputes.

“Arbitration is the preferred method for dispute resolution for investors, and resorting to arbitration will definitely attract more foreign and local investments and investors,” Dr. Osama Ghanem Al- Obaidy, adviser and professor of law at the Institute of Public Administration in Riyadh, told Arab News.

The SCCA uses best international practices and follows the uniform arbitration rules of the UN Commission on International Trade Law, which are trusted by international companies.

Dr. Osama Ghanem Al-Obaidy Adviser and professor of law at the Institute of Public Administration in Riyadh

The professor highlighted the effects of the coronavirus disease pandemic on arbitration, pointing out that the center conducted hearings remotely and online, so that the travel restrictions during the pandemic did not slow down the process.

“The center also continued to fully operate during the pandemic and continued to provide its services and products (to) businesses, as well as nominations and selection of qualified arbitrators and experts (and) ensuring the integrity, transparency of proceedings and arbitrators,” he said.

SCCA’s efforts will also contribute to the success of Crown Prince Mohammed bin Salman’s ambitious Riyadh Strategy 2030, which was announced in January. The Royal Commission for Riyadh City has set a target to attract up to 500 foreign companies to set up their regional headquarters in the capital over the next 10 years, and the legal ecosystem in a country is often a key factor when companies are making decisions on where to locate.

“The center uses best international practices and follows the uniform arbitration rules of the UN Commission on International Travbde Law (UNCITRAL), which are trusted by international companies.

The list of center arbitrators and experts also covers all fields needed to resolve disputes. As well as the freedom granted to companies to select the governing law and to select the arbitrators as well as choosing the language, time and venue for arbitration,” Al-Obaidy said.

He also highlighted another positive development: The appointment of female arbitrators for the first time in the Kingdom. “Two female arbitrators were appointed, one in Dammam and one in the Makkah region by the appeals administrative court, which is a step in the right direction toward appointing women judges in the near future in the court system,” he said.