One of the goals for Vision 2030 seeksto strengthen the governance and efficiency of the Saudi Center for CommercialArbitration (SCCA), by incorporating international best practices in relationto the dispute resolution mechanism, within the framework of the esteemedinstitution. In furtherance of this goal, SCCA published a new set of ArbitrationRules (SCCA Rules), which came into force on May 1, 2023. These ruleshighlighted the various rights and liabilities of the parties and furtherempowered SCCA in furthering a peaceful adjudication of disputes in the region.
A few of the major features of the SCCA Rules, 2023, have been highlighted below:
The SCCA Rules, 2023, have been designed in a manner which extends their applicability to the arbitrations which have either commenced on or after the date of their enforcement. Thus, the proceedings pending before the promulgation of the SCCA Rules, 2023, shall be conducted in accordance with the provisions of the Arbitrations Rules of2016.
One of the most relevant provisions of the SCCA Rules is Article 3, by way of which the SCCA Court (‘Court’) has been established as a body independent of SCCA. The Court has been tasked with managing issues arising during arbitration proceedings, including disputes pertaining to the accumulation of claims in a single arbitration (Article 11)or the appointment of a Presiding Arbitrator.
Other than the aforementioned power of the Court, Article 16 of the SCCA Rules further provides that the appointment of all arbitrators, whether nominated by parties or the Administration, shall be made by the Court. This provision further establishes a superiority of the Court in ensuring the upholding of the values concerning transparency and fairness in the arbitration proceedings, thus, furthering the objective of the SCCA Rules, vis-à-vis, to transform the SCCA into the most preferred institution for arbitration in the region.
As per Article 5 of the SCCA Rules, 2023, a request for arbitration shall include a statement for the dispute to be referred to arbitration, names and contact details of the parties, a copy of the contract which forms the subject matter of dispute and the statement in relation to the relief sought alongwith a proposal relating to form and manner of arbitration.
Upon the receipt of such a request for arbitration, Article 6 of the Rules provide the Respondent with a time duration of 30 days to transmit the answer which shall include the name and contact details of the Respondent Party, alongwith a response to the claim or relief, sought by the Claimant. Article 6 also provides the Respondent with the right to submit a counter-claim or a response to the proposed manner of arbitration, along with the answer.
Section II of the SCCA Rules, 2023, lays down the power of the Centre to consolidate arbitration proceedings in the following cases:
In the latter case, the SCCA may consolidate the proceedings after having regard to all relevant circumstances enshrined under Article 13, including the applicable laws, progress of the case and the questions of law and facts, so involved within the arbitration.
As aforementioned, arbitrators may be nominated, either by the parties or the Court, however, in any case, the power of appointment exclusively lies with the latter. Furthermore, where a matter is to be resolved by a Tribunal comprising of 3 arbitrators, both the parties have been provided with the right to nominate one arbitrator, each while the Presiding Arbitrator shall be appointed by the Court.
In addition to the provisions enshrined under the SCCA Rules which concern general arbitration proceedings, the latter also forms the basis for other forms of arbitrations, including expedited, emergency, and online proceedings. Provisions relating to the form and manner of conducting such proceedings have been enumerated in the Appendices III – IV of the SCCA Rules.
The Expedited Procedure Rules, as provided under Appendix III of the SCCA Rules, shall apply to matters where the claim does not exceed SAR 4,00,000, or in cases where the parties enter into an agreement to the effect of its applicability to the dispute. However, where, by way of amendment, the Party submits a claim which exceeds the aforementioned limit, Article 5 of the Expedited Rules provides that the arbitration shall continue to be governed by the Rules, unless the parties agree to be governed by the SCCA Rules.
In terms of the difference in filing procedures, Article 2 of the Expedited Rules, state that the Claimant will be obliged to serve a copy of the request for arbitration to the Respondent at a time concurrent to the filing and both the Request and the Answer shall contain a detailed set of facts, claims, defenses, as well as the supporting evidence.
It is needful to note that as per these Rules, the arbitration is to be conducted by a Sole Arbitrator, who may be nominated by the Parties within the time frame fixed by the Administrator.
The Power to apply for emergency arbitration flows from Article 7 of the SCCA Rules, 2023, according to which the party applying for emergency measures of protection shall transmit a written application with all requisite details and documents including the reasons for requesting emergency measures.
Article 1 of Appendix III further specifies that the party shall serve the Respondents with a copy of the request at the time of filing. No application for emergency arbitration will be entertained in a circumstance where the application was submitted after the constitution of the tribunal, or where the parties agree to either opt out of the emergency arbitration proceedings or to adopt another pre-arbitral procedure.
The ODR mechanisms in SCCA were initially introduced in the year 2018, and have been revamped in the SCCA Rules, 2023. Unlike the Expedited Rules, provisions relating to the ODR Procedures may apply in addition to those enshrined under the SCCA Rules, in cases where there is no conflict. However, where the latter issue arises, ODR Rules shall take precedence.
The Respondent shall transmit the answer to the request for arbitration within a period of 10 days from the commencement of arbitration. In line with the Expedited Rules, the ODR Procedures also allow the appointment of a Sole Arbitrator for adjudication of disputes, while the place of arbitration has been fixed as Riyadh, Saudi Arabia, unless the parties agree otherwise.
A mere perusal of the provisions pertaining to the time limits and other procedures may provide a reasonable inference to the fact that the ODR rules have been designed to promote a speedy adjudication of arbitration, while maintaining the value of accessibility to parties.
Arbitration is globally emerging as the preferred method for resolving commercial disputes. With such a growing popularity of the mechanism, the amendments brought in by way of SCCA Rules, 2023, is a welcome step to bring the necessary reformation in the arbitration procedures of the region. By inculcating the international best practices and further improving the accessibility and expediency of arbitrations in the way of the aforementioned appendices, the SCCA Rules may be considered to be a needed step in the era, not only for the promotion of arbitration as a method for resolving disputes but also for attaining the goals enshrined under Vision 2030.
.svg)