Governing Law and Dispute Resolution Provisions for Commercial Agreements

For the reasons set out in this article, it is even more important in the Kingdom of Saudi Arabia ("KSA"), than in most other jurisdictions, to carefully consider the wording of governing law and dispute resolution provisions in commercial documentation involving foreign parties.

Governing Law Provisions

It has been common practice in KSA for major commercial and project transaction documentation, involving foreign parties, to nominate English law as the governing law. This is consistent with international practice because English law is widely understood within the international commercial community. However in KSA the choice of English law as the governing law may not always be in the best interests of the parties.