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We are excited to share the latest edition of the Law Update, beautifully and appropriately titled “Sustainable Horizons: The Saudi Arabian Vision.” Giving special honor to the Kingdom’s 2030 vision, this update focuses on a collection of both informative and inspiring articles.
For those in construction, you can learn about how the tendering environment impacts risk-pricing for contractors, the updates on the legal framework of the construction industry and how contractors can protect themselves against financial difficulties.
There is good news too from the kingdom’s banking sector, from which the practice of “Open Banking” is being pushed for! But what is open banking? We’re answering that too.
Also . . . Are there any women trail blazers in Saudi Arabia you can name? We’ll help you with that. We cover how the Middle East has been making strides in empowering women in the entrepreneurial space,most notably in STEM fields.Read the full edition
On 9 March 2023, The Minister of Justice issued Decision No. 28 of 2023 regulating the use of English before the Courts of Bahrain (the “New Regime”). This decision has replaced Decision No. 117 of 2021 (the “Old Regime”) which was the first decision regulating the use of English before the Courts. This article aims to highlight the new changes brought on by the New Regime, as well as to explain its effect on litigation in Bahrain.
“Opt-in” rather than “Opt-out”
The use of English under the Old Regime was what some in the tech industry would refer to as an “Opt-in” feature. What this means is that parties needed to expressly agree – when it comes to certain specific types of disputes – to the use of English before the Court.
The New Regime however switches this into an Opt-out system, where parties are implicitly deemed to agree on the use of English where the agreement out of which the dispute arises is drafted solely in English. With the parties required to expressly agree on the use of Arabic (i.e. Opt-out) should they wish to litigate in Arabic instead.
To what cases does the New Regime apply?
This “Opt-out” system shall be deemed to apply to the following cases (in so far as they fall within the remit of Bahrain Chamber for Dispute resolution (the “BCDR”)):
It must be noted however that not all cases falling within the remit of the BCDR automatically qualify under the Opt-out system. As cases with a value over BHD 500,000 involving individuals, or relating to real estate or trusts shall continue to be governed under the Opt-in system.
It should also be noted that the parties agreement to arbitrate in English shall automatically extend to cover cases for the enforcement or annulment of arbitral awards where the value of the award is in excess of BHD 500,000 as well as requests for the appointment of an arbitrator.
What about dual language agreements and agreements drafted solely in Arabic?
In disputes falling within the abovementioned scope, where the agreement is drafted as a dual language agreement (English and any other language), the Opt-in system shall only be applicable where the parties specifically agree that English shall be treated as the prevailing language of the agreement.
As for disputes arising out of agreements drafted solely in Arabic, these shall be litigated in Arabic, even where the parties agree to litigate such disputes in English and the disputes satisfies the conditions of the Opt-in system as detailed below.
Remnants of the Old Regime
The Opt-in system shall continue to operate for certain cases where the value of the claim is in excess of BHD 500,000, where the language of the agreement is neither Arabic nor English. These disputes are:
All procedures before the Courts
Upon qualification, whether under the Opt-in or Opt-out systems, all cases procedure shall be conducted in English. This include joinders, counterclaims, appeals as well as testimony and expert reports.
The adoption of an Opt-out model regime under the New Regime is expected to increase the use of English before the Courts as parties are no longer required to take any active steps to agree to litigate in English, and with the majority of agreements signed by financial institutions preferring English as the language of their agreement. This will naturally be faced with some opposition from traditionalists (both lawyers and parties) who have always litigated in Arabic and wish to go through litigation as they have always done. However, with the Kingdom’s aim to becoming a leading hub for dispute resolution in the region, this change as well as further upcoming changes and expansion in the use of other languages is almost inevitable.
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