Saudi administrative court aims to boost investor confidence
30/01/24
Saudi Arabia's Ministry of Justice recently announced the Kingdoms first administrative enforcement court with jurisdiction over government entities and officials in a bid to boost investor confidence.
The move follows the enactment of a civil transactions law introduced last month, which in turn was part of wider judicial reforms initiated by the government. Such reforms inend to modernise and diversify the economy by reducing reliance on oil exports in line with Vision 30.
Furthermore, the new civil transactions law is in effect the country's first civil code. As a result, it effectively replaces an unwritten system where judges would come to decisions on commercial disputes based on Islamic law. Consequently, the introduction of both the new court and subsequent law by the Ministry aims to boost the confidence of foreign investors and to pursuade them to select the Kingdom ahead of various options across the GCC region to do business.
Most importantly, as part of the new legislation, the administrative court will receive complaints from both local and foreign investors, who wish to air grievances against government institutions. As a result, the court will prioritise resolving such issues using the process of mediation. In addition, the court will ultimately have the option of applying executive power against government entities and officials if required.
In 2021, the Kingdoms government set targets of reaching SAR 375 billion (USD 100 billion) in foreign direct investment by 2030. It is expected that the introduction of the new court and its associated laws will expedite investors confidence and improve the ease of doing business in the country.
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