Crown Prince Mohammed bin Salman Announces Significant New Reforms to Judicial System, Push Toward Codified Law

Saudi Arabia’s Crown Prince Mohammed bin Salman announced on Monday plans to approve a set of new draft laws designed to enhance the efficiency and integrity of the kingdom’s judicial system, a step that would eventually lead to an entirely codified law.

The significant development is likely to boost the confidence of would-be investors, who have seen the perceived arbitrariness of the kingdom’s courts as a potential risk toward investing. According to Bloomberg, “Authorities are working to codify a system that has historically granted judges wide discretion to issue rulings based on individual interpretations of Islamic law. This discretionary arrangement has created risk for both Saudi and international investors because it can lead to conflicting rulings from different judges even in similar cases.”

There are four new draft laws. The Personal Status Law, the Civil Transactions Law, the Penal Code for Discretionary Sanctions, and the Law of Evidence “represent a new wave of judicial reforms in the Kingdom,” Saudi state news agency SPA quoted Crown Prince Mohammed bin Salman as saying late Monday.

While legislation will still be rooted in Islamic law, the codification “will contribute to the predictability of rulings” and “limit individualism in issuing verdicts,” Crown Prince Mohammed bin Salman, said in a statement published late Monday by the official Saudi Press Agency. “The new laws represent a new wave of reforms that will … increase the reliability of procedures and oversight mechanisms as cornerstones in achieving the principles of justice, clarifying the lines of accountability, he said.

The new laws will be announced over the course of 2021. A Saudi official told Reuters that reforms are designed to meet the needs of the modern world while adhering to Sharia.

The announcement is the latest in a series of ambitious and significant economic and social reforms launched since 2016, when Crown Prince Mohammed bin Salman announced the Kingdom’s Vision 2030.

“This could be quite significant,” Kristin Diwan, a senior resident scholar at the Arab Gulf States Institute in Washington, told Reuters. “This lack of predictability is a real problem as MBS looks to attract more foreign investment and to lure more foreign businesses and tourists to the kingdom.”

Tarek Fadlallah, Middle East CEO at Nomura Asset Management, told CNBC the move is an important step.

“This is an important step on the path towards global best practices that give businesses the confidence to invest,” he said.





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