Arbitration in the Kingdom of Saudi Arabia has become essential and has received significant attention and significant transformations in recent years. These developments are based on comprehensive legal reforms and the establishment of specialized arbitration institutions that are aligned with international best practices.

The Arbitration Law, promulgated by Royal Decree No. M/34 of 2012, constitutes the cornerstone of supporting and developing arbitration in the Kingdom of Saudi Arabia. It is based primarily on the UNCITRAL Model Law, ensuring consistency with internationally recognized arbitration standards. The Arbitration Law applies to both domestic and international disputes referred to arbitration, provided they meet the criteria specified in the law. A key aspect of this law is its emphasis on party autonomy, allowing disputing parties the freedom to agree on procedural aspects, such as the law applicable to the subject matter of the dispute, the location of the arbitration, the selection of arbitrators, and more. The law also includes a provision stipulating that any arbitration conducted in the Kingdom must not conflict with the principles of Islamic Sharia or public order. This law established specialized enforcement courts responsible for the enforcement of domestic and foreign arbitration awards and rulings, expediting the enforcement process and enhancing judicial efficiency.

One important feature that demonstrates the development of arbitration in the Kingdom is the establishment of a sophisticated arbitration center, the Saudi Center for Commercial Arbitration (SCCA), in 2014. The center administers alternative dispute resolution (ADR) procedures, including arbitration and mediation, in commercial disputes. The center operates as a non-profit organization, focusing on arbitration principles such as the independence of the arbitration clause, impartiality, integrity, transparency, confidentiality, and accountability.

In May 2023, the SCCA issued updated arbitration rules aimed at enhancing efficiency and keeping pace with international best practices. A key feature of these rules is the establishment of the SCCA Court: an independent body responsible for making key administrative decisions related to arbitrations administered by the center. The SCCA Court comprises experts from various countries with extensive experience in the field of arbitration. The Center has also developed online dispute resolution (ODR) capabilities by implementing an online dispute resolution platform for certain low-value disputes, enhancing accessibility and cost-effectiveness in resolving commercial disputes. It also allows for the electronic transmission of documents, virtual hearings, and electronic signature of judgments, improving efficiency and reducing environmental impact.

Saudi Arabia also acceded (in 1994) to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), facilitating the recognition and enforcement of foreign arbitral awards within the Kingdom and enhancing confidence between international investors and parties involved in cross-border transactions.

In addition, the Kingdom has focused on developing specialized courts in the field of international commercial arbitration. Overall, the remarkable development in arbitration in Saudi Arabia reflects efforts to modernize dispute resolution mechanisms in line with international standards while adhering to the principles of Islamic Sharia. The establishment of the Saudi Center for Commercial Arbitration, the adoption of advanced arbitration laws, and adherence to international agreements underscore the Kingdom's commitment to providing effective and reliable arbitration services. These developments enhance the attractiveness of Saudi Arabia as a center for settling commercial disputes.