Reforms to Saudi legal sector set to attract foreign law firms to the Kingdom

RIYADH: Saudi Arabia is on the brink of a transformative policy shift that would permit licensed foreign law firms to establish companies fully owned by non-Saudis.

This initiative, announced by the National Competitiveness Center, is part of a broader strategy to attract foreign investment and enhance the Kingdom’s business environment.

The NCC has solicited public feedback on a Ministry of Justice proposal through its official account on X, which could fundamentally reshape the legal landscape in Saudi Arabia.

A progressive legal reform

The proposal seeks to amend the first paragraph of Article 50 of the Kingdom’s Code of Law Practice. If enacted, it would allow non-Saudi law firms to set up wholly foreign-owned professional companies.

These firms would offer legal advice on the Kingdom’s regulations and represent clients in court through registered Saudi lawyers.

Details posted on the Istitlaa platform reveal that this project aims to advance the legal profession, improve the quality and efficiency of the industry, and integrate global expertise into the local context.

Furthermore, it is designed to bolster the Kingdom’s competitiveness, enhance its business climate, and elevate the efficiency of the justice system by increasing professionalism within the legal sector.

The proposed amendment signifies a progressive step in Saudi Arabia’s legal reforms.

By allowing foreign law firms to operate independently, the Kingdom aims to develop its legal profession by introducing international standards and practices.

Lebanon-based attorney Jihad Chidiac told Arab News that permitting foreign law firms to set up offices in Saudi Arabia enhances the quality of legal services by combining global expertise and experience with local knowledge and specificities.

He added: “These firms operating according to international legal standards may encourage the development of a more solid legal framework and regulatory environment, which is essential for attracting foreign investment and fostering a transparent business environment.”

Homam Khoshaim, a partner in corporate finance at London-based law firm Addleshaw Goddard, echoed this sentiment, and told Arab News: “The entry of additional international law firms in the Kingdom indicates a growing legal sector, healthy competition among legal services providers, and a growing economy that demands its legal needs be met.”

He added: “Clients stand to benefit from a more diverse legal market offering a wider range of services, deeper expertise, and international networks. This is especially advantageous for Saudi-based clients that operate globally.”