The 2012 Arbitration Reform In the Kingdom Of Saudi Arabia: An Examination of the 2012 Arbitration Law Reform

The Kingdom of Saudi Arabia is an absolute monarchy in which both Islam and cultural traditions influence every sphere of human activity in the country, including legal and law reform. This thesis is concerned with arbitration law reform in the country, with a special focus on the process of the new 2012 arbitration law reform and the internal and external factors which have affected this process. In the last few years, law reform in the country was mainly derived from the desire to escape the nature of its rentier economy and its heavy reliance on oil to diversify the sources of its income, with a special focus on attracting foreign direct investments. As a result, much of law reform occurred for the purpose of providing a friendly and secure investment environment in the Kingdom. The main focus of this thesis is therefore, to examine the process of arbitration law making , which in this case has taken almost 30 years to the completion of the new 2012 Arbitration Law which has replaced the old 1983 arbitration law. This examination of arbitration reform adopts two main approaches: first, a political economy approach which examines the impact of the nature of the rentier economy on law reform in the country and, second, a socio-legal-political approach which examine the impact of the ruling regime, religion and society on the process of the arbitration reform process. The thesis approaches the issue of arbitration reform in the Kingdom by looking at certain specific issues. The thesis thus, explores the nature of the constitutional regime and commercial laws of the country in an attempt to understand the country under investigation; the thesis moves on to examine the position of the Kingdom towards arbitration as a mean of solving disputes. The thesis examines the process of law making in the Kingdom, and separate chapters examine the impact of economic and social factors on law reform in the country. The contents of the new arbitral legislation are evaluated in light of international commercial arbitration law. The final chapters illustrate the observations and the findings of the thesis. The thesis finds that the delays in terms of arbitration law reform can be explained by two main factors; one is the historical experience factor (1958 Saudi Arabia v. Arabian American Oil Co.), the and second is the socio-legal factor (the conservative traditionalists' position), which have each played a role in the 30-year delay in Saudi arbitration reform.