Under Saudi law, a person can view some information related to another party’s assets. This information is generally provided through public registers, for example, the Unified Registry on Movable Assets, as well as Aamaly Magazine, each of which provides information on companies’ articles of association and any amendments to them, including shareholders’ information and percentage of ownership. This informal method is helpful at getting a general sense of another party’s assets; however, detailed information regarding a party’s assets, including real estate, registered vehicles, etc, can only be provided based on a court order.

Under the Saudi Enforcement Law (Article 46), if a debtor fails to comply or disclose any property that is sufficient to the debt owed within five days from the date of notification, the enforcement court will order:

• full disclosure of current property and any future property that would come into the debtor’s ownership;
• full disclosure of the debtor’s commercial and professional records;
• the freezing of the debtor’s bank accounts, investment accounts and portfolios; and
• the banning of the debtor from issuing powers of attorney or delegating power to act to others with respect to the debtor’s property.

Furthermore, the enforcement court may order full disclosure of the debtor’s spouse, children, siblings, relatives and/or others to whom evidence shows the debtor’s property was transferred.

Under Saudi law, primarily its Law of Civil Procedures, court judgments are categorised into several types. The different types of domestic judgments include the following.

Substantive Judgments

Substantive judgments are where the courts determine and decide the substantive matters in disputes, for instance, parties’ rights, duties, liabilities and obligations.

Final Judgments

Final judgments are judgments that become legally binding and enforceable, either:

• because the case decided falls under the small claims category, under which a trial court’s ruling is final and not subject to appeal; or
• because of the expiration of the appeal period; or
• due to the affirmation of trial court’s ruling by the appellate court.

Declaratory Judgments

Declaratory judgments are the court’s ruling upon which a right, state, obligation and/or duty is declared. In declaratory judgments, the ruling does not require specific performance by the parties, for example, cases filed to prove marriage or divorce.

Summary Judgments

Summary judgments are rendered in cases that require urgent decision and intervention by a court of law. Under this type of judgment, courts do not decide the substantive matters but the urgent matter at stake, which requires an urgent intervention by courts of law, which include:

• cases requiring inspection to determine the present condition;
• cases to prevent interference with possession or facilitate the recovery of possession; and
• cases to preserve testimony of a witness whose testimony is at risk of being unavailable at the time of the dispute.

Enforcement Judgments

Enforcement judgments are decisions made by the enforcement court to compel a debtor to satisfy a debt after the debtor fails to comply and satisfy the debt voluntarily.

Upon the debtor’s failure to comply or disclose any property that is sufficient to satisfy the debt owed within the five-day period, the enforcement court will order the actions provided in 1.1 Options to Identify Another Party’s Asset Position, against the debtor. Accordingly, the following are the available options to enforce the judgment.

Attachment of Property

An attachment order targets every asset owned by the debtor and invalidates any action taken by the debtor with respect to the attached assets. However, several kinds of assets are exempted from attachment, as long as they are not pledged to the creditor(s), which include:

• (i) the residence of the debtor and his/her dependants;
• (ii) the debtor’s necessary means of transportation;
• (iii) the debtor’s personal items;
• (iv) every tool the debtor needs to practise his/her profession; and
• (v) the debtor’s salary, except 50% of the salary and/or wage in alimony cases, and one-third of the total salary in other debts.

The enforcement judge has the authority to determine the adequacy of the debtor’s needs with respect to subjects under (i), (ii) and (iii) above.

Sale of Attached Property

As governed under Chapter Two of the Enforcement Law, the debtor’s attached property will be offered at an auction. The auction arranged must meet several requirements:

• the auction commencement must be in the presence of the enforcement officer;
• no person may participate or be admitted to the auction unless qualified based on the arrangements set forth by the Ministry of Justice and the Saudi Arabian Monetary Agency, to ensure participants’ financial competence and method of payment; and
• in any case, the attached property must not be sold for less than the reserve price.

Garnishment

The garnishment method extends to cover a debtor’s funds held by financial institutions, as well as credit accounts, investment accounts, insurance claims, companies’ shares, securities, negotiable instruments, and any other property deposited in safe deposit boxes. Furthermore, this method includes debts owed by a third party to the debtor.

Insolvency

Upon the debtor’s failure to satisfy the debt(s) owed and claim insolvency, the enforcement court, after completing all procedures relating to disclosure of property, questioning and tracking property, and after publishing an announcement in one or more newspapers containing the grounds for the filed insolvency, will verify the claim of insolvency. After establishing insolvency, the enforcement court will order competent authorities to attach any property the debtor may receive. Also, if the creditor discovers any property owned by the insolvent debtor, the creditor may present the same enforcement document to the court.

The costs and time taken to enforce a domestic judgment vary depending on several factors, including the nature of the debt, the amount owed and the nature of the debtor (whether a natural or legal person). However, the following sets out the general range of costs and time a judgment will take to be enforced.

Costs

Costs involved in enforcing a judgment include:

• Judicial fees:The judicial fee for an immediate enforcement motion is SAR500, and 2% of the claimed amount with respect to other enforcement motions. In any case, the fee is not less than SAR500 and not more than SAR10,000. Furthermore, other small amounts are imposed in certain instances, such as a fee of SAR100 for a motion filed by an interested person to obtain a certified copy of the case papers or records, a fee of SAR50 for a motion filed by an interested person to access the case papers, and a fee of SAR100 for a replacement copy of a judicial document.
• Custodian of attached property fees:The custodian fee is estimated based on the quantum meruit (ie, reasonable sum). It varies based on the attached property in custody.

Time

The time needed to enforce a judgment varies based on whether the debtor has sufficient money to satisfy the debt owed. If so, the time needed for the satisfaction of a debt should take no more than one month. However, if the debtor does not satisfy the debt voluntarily, and compulsory proceedings have been initiated against the debtor, the process to collect the debt could take significantly longer in the case of an insolvent debtor.

As mentioned in 2.2 Enforcement of Domestic Judgments, after the debtor fails to voluntarily satisfy the debt owed within the five-day period, the enforcement judge will initiate the compulsory enforcement procedure against the debtor. This procedure includes the disclosure and determination of the debtor’s assets, which will later be subject to attachment and sale at auction.

Challenging the enforcement of a domestic judgment could involve either a form-related aspect or a substantive-related aspect. A defendant may challenge the enforcement by the following methods:

• Form-related enforcement dispute: The defendant challenges the formal aspect of the enforcement document or procedure, for example, the non-fulfilment of a formal requirement of the enforcement document, forgery of the enforcement document or instrument, or denial of the signature.
• Substance-related enforcement dispute: The defendant challenges the substantive aspect of an enforcement procedure, for example, discharge, postponement, action or settlement after the issuance of the enforcement document, set-off based on an enforcement document, and/or that the seized assets exceed the amount of the claimed debt.

No domestic judgment is enforceable unless:

• the rendered judgment is final and not challengeable (either because the period of appeal has expired or because the higher court affirmed the lower court’s judgment), and the judgment instrument contains the enforcement formula; or
• the judgment is a self-executing judgment, or if self-execution is provided under relevant laws and regulations.

Unlike the registers for bankruptcy, intellectual property or franchise agreements, there is no central register for domestic judgments in the Kingdom of Saudi Arabia.

Under the Enforcement Law and its Implementing Regulations, foreign judgments are recognised and enforceable upon the satisfaction of the principle of reciprocity. Furthermore, recognised foreign judgments sought to be enforced must meet the following legal requirements:

• the Saudi Arabian courts have no jurisdiction to review the dispute in which the foreign court rendered the judgment, and the foreign court that rendered the judgment had jurisdiction over the dispute based on the international judicial jurisdiction rules in the issuing court’s country;
• the parties to the case regarding which the foreign court rendered its judgment were summoned to appear, properly and duly represented, and had the right and opportunity to defend themselves;
• the rendered judgment is final, according to the relevant laws of the issuing court;
• the rendered judgment is not in conflict with any judgment or order rendered by a Saudi court in the same case; and
• the foreign judgment is not in conflict with the Kingdom of Saudi Arabia’s public order. (As defined in the Enforcement Law Implementing Regulations (Article 11/3), “public order” means the provisions of Sharia.)

Besides the legal requirements mentioned above, which must be met in order to enforce a foreign judgment in the Kingdom of Saudi Arabia, the principle of reciprocity constitutes the pillar for the recognition of foreign judgments. In this respect, the Enforcement Law emphasises adherence to the international agreements and treaties the Kingdom has ratified. For example, the following are the conventions the Kingdom has ratified concerning the enforcement of foreign judgments and arbitral awards:

• the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958);
• the Riyadh Arab Agreement for Judicial Cooperation (1983); and
• the Gulf Cooperation Council Convention for the Execution of Judgments, Delegations, and Judicial Notifications (1996).

The approach to enforcing foreign judgments varies depending on whether the foreign judgment was issued in a country that is a member of an international treaty or agreement to which the Kingdom of Saudi Arabia is a party. There are two approaches concerning the recognition and enforcement of foreign judgments:

• Reciprocity-based approach: As a matter of law, an enforcement judge is prohibited from enforcing any foreign judgment except on the basis of reciprocity. If the reciprocity element is not met, the foreign judgment shall not be recognised, and therefore shall not be enforced.
• Convention-based approach: If the foreign judgment sought to be enforced in the Kingdom was issued by a court in a member state of a convention that the Kingdom has ratified, then the judgment shall be recognised and therefore enforced, after the legal requirements provided in 3.1 Legal Issues Concerning Enforcement of Foreign Judgments are met.

After being recognised, a foreign judgment is enforceable as long as it meets the legal requirements described in 3.1 Legal Issues Concerning Enforcement of Foreign Judgments. If one of the legal requirements has not been met, the Kingdom’s enforcement courts will hold it unenforceable, for instance, if a foreign judgment meets all the legal requirements but it conflicts with the Kingdom’s public order, either in full or in part. This is considered the most challenging aspect of seeking to enforce foreign judgments in the Kingdom. Further explanation is provided in 3.6 Challenging Enforcement of Foreign Judgments.

The process of enforcing a foreign judgment in the Kingdom of Saudi Arabia includes the following.

1. Application Filing

The first step for creditors seeking to enforce a foreign judgment is to file a request for enforcement with the enforcement court. This process can be completed through the Ministry of Justice portal (“Najiz”).

2. Attaching/Submitting Required Documents

An applicant for the enforcement of a foreign judgment must present several documents that are essential for the application to be reviewed. These documents include:

• identification document(s) of the creditor(s);
• authenticated delegation/power of attorney (if the application is being filed by representatives or attorneys of the creditor(s)), including each person’s identification document;
• an official copy of the foreign judgment;
• an attestation stating that the foreign judgment has become final and enforceable, and that a competent judicial agency issued the foreign judgment; and
• a certified copy of the judgment notice, or any other evidence establishing that the defendant received due and proper notice of the proceedings, if the judgment was rendered in absentia.

3. Review and Verification

After the filing of the enforcement application, the enforcement court will review the application and either accept the application, return the application to the applicant to reattach required documents or provide further documents/information, or reject the application.

4. Enforcement Procedure

Upon accepting the enforcement application, the enforcement court will start the enforcement process, starting with notifying the debtor to disclose and satisfy the debt owed within five days from the notification date. In case of the debtor’s failure to satisfy the debt within the designated period, compulsory enforcement measures will be initiated, starting with a disclosure order issued by the enforcement judge to all relevant governmental agencies.

Similar to the costs and time taken with respect to enforcing a domestic judgment, the costs and time taken to enforce a foreign judgment vary depending on several factors, such as the nature of the debt, the amount owed and the nature of the debtor, as well as the nature of the foreign judgment and the verification process of the enforcement court to ensure the foreign judgment sought to be enforced meets all the requirements set forth by law.

In addition to disputing the form and the substance aspects, as described in 2.5 Challenging Enforcement of Domestic Judgments, and assuming the foreign judgment sought to be enforced has already met all the requirements imposed by law, a defendant may challenge any conflicts that the foreign judgment might have with respect to the Kingdom of Saudi Arabia’s public order (Sharia provisions), for example, if a foreign judgment holds that the defendant owed the plaintiff an amount of money, some of which is interest applied to the original debt. Even though the law of the forum in which the judgment was rendered approves such a transaction, the defendant may argue the illegality of the applied interest, as it conflicts with Sharia provisions.

The legal issues concerning the enforcement of arbitral awards vary depending on whether the arbitral award sought to be enforced was a domestic or a foreign award. If it is a domestic arbitral award, it is recognised by law. However, if it is a foreign arbitral award, then the requirements set out in 3.1 Legal Issues Concerning Enforcement of Foreign Judgments must be met, after the enforcement judge verifies the reciprocity element. Upon meeting all recognition and enforceability elements, a foreign arbitral award can be enforced in the Kingdom, as long as the debtor does not challenge the enforcement of the arbitral award.

The approach to enforcing an arbitral award varies based on whether the arbitral award sought to be enforced in the Kingdom of Saudi Arabia is a domestic or a foreign arbitral award.

• Domestic arbitral awards: Domestic arbitral awards are recognised per se. Therefore, enforcement proceedings will not extend to cover the elements concerning public order, ie, whether the arbitral award was issued in a member forum, based on a treaty, convention or bilateral international agreement, and whether the element of reciprocity has been met and verified by the enforcement court.
• Foreign arbitral awards: The approach to enforcing a foreign arbitral award differs due to its nature, which requires it to be recognised first. As explained in ‘Domestic arbitral awards’ above, a foreign arbitral award needs to be recognised first by verifying that it meets the reciprocity element/was issued in a member forum, and that the judgment rendered therein does not conflict with the Kingdom’s public order.

Arbitral awards will not be enforced, either in part or in full, if:

• the arbitral award’s documents lack the enforcement formula;
• the deadline for filing a nullification action has not elapsed;
• a case has been filed to nullify the arbitration award, and the court has granted the plaintiff’s request to stay the enforcement of the arbitral award;
• the arbitral award conflicts with a judgment or decision issued by a Saudi court or committee that has jurisdiction to decide the dispute in the Kingdom;
• the arbitral award violates the Kingdom’s public order (Sharia provisions) – if an arbitral award violates Sharia provisions in part, the remaining part that does not violate Sharia provisions can be enforced;
• the party against whom the arbitral award was rendered has not been properly notified; and
• the reciprocity element has not been met with respect to foreign arbitral awards.

After the arbitral award has been issued, an enforcement request can be filed with the appellate court. The request to enforce the arbitral award must include the following:

• the original copy or an attested copy of the award;
• a true copy of the arbitration agreement;
• an Arabic translation if the arbitral award’s language is not Arabic; and
• proof indicating the deposit of the arbitral award with the appellate court.

Upon issuing the order for the enforcement of the arbitral award, the arbitral award is considered enforceable and becomes an enforcement document, as designated in the Enforcement Law (Article 9).

The later enforcement process carried out by the enforcement court to enforce the arbitral award is explained in 3.4 Process of Enforcing Foreign Judgments.

In addition to the costs and time taken with respect to enforcing a domestic judgment, as described in 2.3 Costs and Time Taken to Enforce Domestic Judgments, there are other costs related to enforcing an arbitral award, which include:

• arbitrators’ fees;
• fees incurred during the arbitration proceedings; and
• in the case of filing a petition to nullify the arbitral award before the appellate court, a 1% judicial fee of the amount awarded will be imposed upon the plaintiff, with a maximum of SAR1 million, if the petition is dismissed.

Enforcement of an arbitral award can be challenged relying on several aspects that may include:

• the arbitral award sought to be enforced does not have the enforcement formula;
• a petition to nullify the arbitral award was filed, and the court has granted the request to stay the enforcement; and
• the arbitral award, even though it is final and enforceable, is in conflict with the Kingdom of Saudi Arabia’s public order, either in part or in full.