Dispute Avoidance Considerations in Saudi Arabia

1. Good Contract Management

One of the key things to consider when it comes to dispute avoidance is efficient contract management. This includes selecting the right contracting framework and doing a thorough review of the parties’ obligations, requirements, and contractual procedures.

2. Expert Determination

Expert determination is a procedure in which a difference between the parties is submitted, by agreement of the parties, to one or more experts who make a determination on the matter referred. The determination is binding, unless the parties agree otherwise. As a result, parties can gain a realistic perspective on their chances of success, which can potentially lead to a settlement or conflict resolution strategy.

3. Mediation

As of November 2020, Saudi Arabia has enacted mediation as a means of enforcing international settlement agreements through the Saudi courts. Mediation is effectively an assisted form of settlement where the mediator will be a third party negotiator. Their role is to assist and facilitate an amicable settlement or commercial agreement between parties.

4. Settlement

Compared to other forms of dispute avoidance strategies, settlement is by far the most cost effective way of resolving a dispute. It is arguably less adversarial, which contributes to the maintenance of professional relationships. As per the New Enforcement Law in Saudi Arabia, it is encouraged that parties to amicably resolve matters before seeking legal recourse in court.

Dispute Avoidance Tips in Saudi Arabia

Aside from the above-mentioned key considerations, here are other practical tips which can help parties avoid or ease the impact of a dispute.

• Make sure you are organized, proactive and up to date from the start of a project so you can address and when necessary anticipate and respond to these issues.

• Build strong relationships with the counterparty’s representatives by developing good communication protocols. As part of this process, you may hold regular face-to-face meetings and other forums where the parties can engage in an open and transparent dialogue.

• Seek external legal or professional assistance early on. Taking this simple step at the beginning of a dispute can save parties considerable time, money, and other resources, and help them formulate a dispute resolution strategy.

• Take a reasonable and realistic approach. In order to achieve this, parties must consider all aspects of the disputed matter when engaging in dialogue.

Fuel Collection helps various firms in Saudi Arabia with resolving their disputes faster. For more information on how we can help you contact us today.