The Refusal of Foreign Arbitral Awards in Saudi Arabia on the Grounds of Public Policy: An Issue of Fairness and Justice

Saudi Arabia is a country which has gone to great effort to become part of the international commercial community which has required it to reform its international arbitration laws. The reforms have focused on aligning arbitration and enforcement practices with the rest of the world and to make the process easier for both foreign and local parties involved by giving them the freedom to choose terms and seats for arbitration. While this has been successful, the recognition and enforcement of awards in Saudi Arabia has been met with suspicion that refusal to enforce such awards on the grounds of public policy is taking place for motives other than what is afforded by the grounds of public policy, which is mostly founded on the protection of Sharia principles, in order to protect political or economic interests. This study seeks to establish whether or not such refusals on the grounds of public policy are fair and just, in that there is sincerity in their application. The study examines arbitration law in Saudi Arabia and its application, and though semi-structured interviews seeks to reveal the opinions of legal professionals working in private and government sectors. The results reveal that there is not much apparent scope for the abuse of the public policy privilege afforded by the New York Convention 1958 and that it was the overall opinion of legal personnel that the application of Sharia principles in public policy enforcement refusal were applied justly. The results also revealed, by a minority of respondents, that there is the possibility that public policy could be used for ulterior motives which would be unfair and unjust