Introduction
Saudi Arabia, with its extensive coastline along the Red Sea and Arabian Gulf, is renowned for its thriving maritime industry. Therefore, it is essential to establish a foundational framework to govern and regulate this industry effectively.
In line with this objective, on 05/04/1440 H (corresponding to 12/12/2018 G), the Saudi Arabian legislator enacted Saudi Arabia Royal Decree No. M33/1440, titled “On the Approval of the Commercial Maritime Law” (also known as Saudi Arabia Cabinet Decision No. 197/1440 Approving the Commercial Maritime Law), hereafter referred to as “The Maritime Law.”
Recognizing the pivotal role of maritime law in fostering economic development, this progressive step by the Kingdom aims to bolster the legal framework governing civil and commercial transactions within the maritime sector.
Vessels’ provisional arrests and maritime claims
it is possible to provisionally arrest a vessel under the Maritime Law, however, it is important to note that the judge presiding over the vessel’s arrest application holds the authority to either accept or reject the application.
As per Article 74 of the Maritime Law, the provisional arrest order can only be executed through a judicial order issued by a competent court, and it is only granted for the purpose of satisfying a maritime claim.
Hence, it is imperative to establish the existence of a maritime claim in order to proceed with the arrest of a vessel. These maritime claims are defined in Article 75 of the Maritime Law, which specifies that a debt qualifies as a maritime debt if it arises from one or more of the following circumstances:
- Damage caused by the vessel by reason of a collision, pollution, or other similar maritime accidents.
- Loss of life or bodily injury caused by the vessel or arising from the operation thereof.
- Contracts relating to the operation or charter of the vessel.
- Contracts relating to carriage of goods under a charterparty or a bill of lading.
- Loss of or damage to goods and baggage carried by the vessel.
- Rescue operations.
- General average losses.
- Towage of the vessel.
- Pilotage
- Supply of materials or equipment necessary for the operation or maintenance of the vessel.
- Vessel building, repair, or outfitting, and the expenses of its presence in the docks.
- Wages of the master, officers, crew members, and maritime agents.
- Amounts expended by the master, consignors, charterers, or maritime agents on account of the vessel or its owner.
- A dispute over the ownership of a vessel.
- A dispute in connection with the co- ownership, possession, or utilization of a vessel, or with the co-owners’ rights to the amounts resulting from utilization thereof.
- maritime mortgage.
- Port and waterway fees and dues.
- Insurance of a vessel.
- Expenses of salvaging shipwrecks or cargo, lifting and removing them.
What are the Procedures and the time frame for filing a provisional arrest?
The provisional arrest application should be filed through the online court’s portal system under the expedited proceedings.
According to Article 76 of the Maritime Law, any creditor of a maritime claim may provisionally arrest the vessel to which the debt relates, or any other vessel owned by the debtor at the time of submitting/ filing the arrest application.
Once the arrest order is granted, the plaintiff shall provide a copy of the provisional arrest minutes to the vessel’s master, or whoever acts on their behalf, and a second copy to the competent authority in the port where the provisional arrest occurred to prevent the vessel from sailing, and a third to the registration office at the mentioned port, with this office being notified to the vessel’s registration office for endorsement in the register. As per Article 79 of the Maritime Law, the arresting party must file the substantive claim before the competent court within 8 days from the date of serving the minutes of the arrest on the master and/or his representative, failing which the arrest order shall be treated as null and void.
What are the requirements to register a provisional arrest?
In this context, it is important to emphasize that the official language of the Kingdom of Saudi Arabia (KSA) is Arabic. Therefore, any documents in a foreign language must be translated into Arabic by a sworn translator in KSA prior to submitting before the competent court. This requirement ensures compliance with local regulations and facilitates proper understanding and processing of the documents within the legal framework of KSA.
Accordingly in order to apply for a provisional arrest application the following process has to be followed:
- All supporting documents related to the maritime claim must be translated into Arabic language.
- A duly notarized Power of Attorney (“POA”), issued and executed by the arresting party in his country of origin, then to be legalized and attested up to the KSA Embassy in the respective country must be submitted to the competent court.
- Precautionary steps, just in case required by the court, to have all original documents available such as the POA, contracts, etc.
Consequently, it is crucial for any vessel arrest application to be supported with all documentary evidence, preferably the documents to be in original form. Additionally, it is advisable for the claimant to complete the execution and legalization of their power of attorney prior to the vessel’s entering Saudi territorial waters.
This precaution is recommended; as the formalization of the power of attorney and the translation of the supporting documents may consume a significant amount of time, therefore completing it in advance can help expedite the legal process.
The process for lifting an arrest and the type of required security.
The vessel can be released in case of an amicable settlement between the parties, through an application to be submitted by the arresting party before the concerned judge.
However, if the defendant wishes to release the vessel, he must deposit the security amount determined by the judge and request the issuance of a release order for the vessel.
The type of acceptable security by the court must be submitted in the form of a Bank Guarantee issued by a Local Saudi Bank.
Once the security is submitted and accepted, the release orders must be served upon the vessel and the relevant authorities, such as the harbor master or the coast guard to allow the vessel to sail.
It is also imperative to note that the time frame to release the vessel may take up to 72 hours from submitting the release application.
Authors
Dr Bader AlBusaiyes
Founder and Managing Partner
AlSuwaiket & AlBusaiyes Lawyers and Legal Consultants Co.
Al Khobar Saudi Arabia
Email: dr.bader@sbsaudilawyers.com
Mob: +966 50 5945306
In collaboration with
Mr. Shehab Mamdouh
Managing Associate
Fichte & Co Legal
Dubai, United Arab Emirates
Email: Shehab.mamdouh@fichtelegal.com
Mob: +971 44 357577