SCCA reduces cost of arbitration services and enhances customers accessibility

SCCA reduces cost of arbitration services and enhances customers accessibility

Published Date: 31/08/2021

In a step aimed at supporting the business sector and the investment environment, the Saudi Center for Commercial Arbitration (“SCCA”) announces the launch of a package of enhancements to make its range services more accessible. They include, among many other things, a reduction in arbitrator fees of up to 30 percent, a 50 percent reduction in initial costs for starting most arbitration proceedings, and the flexibility for parties to now agree to a new alternative fee arrangement based on arbitrators’ hourly rates in addition to the existing ad valorem lump sum model.

 

This step is a result of SCCA Board of Directors approval of several amendments to Appendix I of the SCCA Arbitration Rules. The Board’s aim is to extend SCCA’s range of institutional arbitration services to a wider range of various sectors, sizes, and nationalities.

 

Effective on 1 September 2021, the amendments to Appendix 1 of the SCCA Arbitration Rules streamline the process and make it more affordable. For example, SCCA has eliminated its filing fee in its entirety. All a filing party now needs to advance is a flat rate registration fee of SAR 5,000 that will later be credited towards its share in administrative fees. This also reduces the initial cost in starting the arbitration proceeding by 50 percent for claims above SAR 400,000. In addition, the administrative fees start at a SAR 2,000 flat rate for proceedings under the ODR Protocol and do not exceed SAR 300,000 for any other arbitration proceedings – that is they now include an upper cap that cannot be exceeded, no matter the amount in dispute.

 

SCCA has further reviewed the arbitrator fees and reduced them by up to 30 percent. To provide more transparency, SCCA has also introduced three pricing levels: minimum, maximum, and average. SCCA fixes the arbitrator fees on a case-by-case basis within the minimum and maximum depending on the complexity of the matter and the time and effort required by the arbitrator(s) to determine the case. Instituting such minimum and maximum fees enables the parties to project the costs of arbitration before the commencement of the proceedings, thereby increasing predictability and transparency.

 

SCCA has also introduced the ability for parties to agree to ‘alternative fee arrangements’ in which they compensate arbitrators based on hourly arbitrator rates. This method will be available alongside the ad valorem method in use at SCCA, in which the fee is calculated based on the amount in dispute. The latter will remain the default mechanism in case the parties cannot agree on an hourly rate mechanism.

 

For Online Dispute Resolution (“ODR”), SCCA reduced the cost of its service by 40 percent to make it even more accessible to all business sectors, especially innovators, entrepreneurs and those operating small-to large-sized enterprises.

 

In addition to restructuring arbitration costs and fees, the amendments to Appendix I of the SCCA Arbitration Rules offer options to facilitate the advancement of deposits for SCCA fees and arbitrator fees, including installment plans and the use of bank guarantees in case of larger amounts.

 

To help clients estimate the costs of arbitration, SCCA provides an interactive calculator that provides a preliminary assessment of the arbitration costs while comparing the various SCCA arbitration services based on the service selected and the number of arbitrators, the costs may range between rise or fall by 25 to 200 percent.

 

Dr. Walid bin Sulaiman Abanumay, Chairman of SCCA, emphasized SCCA’s never-ending commitment to    delivering the world-class   alternative dispute resolution services it provides to all the local and international businesses operating in the region and making SCCA the preferred choice for all its clients seeking access to justice.

 

Dr. Abanumay added: “The amendments to Appendix I ensure the utility of innovative arbitration services SCCA offers alongside standard arbitration, such as expedited arbitration, which provides a quick path to dispute resolution at a cost that is 20 percent than standard arbitration, and online arbitration, which enables the parties to settle their dispute remotely within 30 days of the arbitrator’s appointment.”

 

The SCCA Chairman said: “SCCA’s online Interactive Calculator serves as a guide to customers in identifying the least expensive arbitration services for their commercial dispute. It calculates a preliminary cost for the arbitration process and provides a comparison, thus enabling them to choose the arbitration option that suits their needs and budget – while resolving their disputes.”

 

SCCA invites current and potential customers to view the updated Appendix I to the SCCA Arbitration Rules. They can also access the Interactive Arbitration Calculator.

 

SCCA also invites parties and their counsels wishing to obtain more information on SCCA services to visit its website, or contact SCCA at +966 9200 03625, via the Contact Us form, or via email at info@sadr.org.