Disputes with Saudi distributors, agents, contractors and suppliers
In Saudi Arabia, distribution and project disputes usually turn on three things: what the contract says, what was registered, and what can be proved. Ending a distributor relationship involves the contract and a government register, while project payment disputes follow the chain from owner to contractor to supplier. We act for the foreign company in both kinds of dispute.
Published by RAED ALI ALJOHANI COMPANY FOR Lawyership and Legal Consultations · Last updated
General information about Saudi law — not advice on your situation.
Tell us in a few lines who the Saudi party is, what your contract covers and what has gone wrong — no documents yet.
At a glance
- Who this is for
- Foreign brand owners and manufacturers with a Saudi distributor or agent, and foreign contractors, subcontractors and suppliers on projects in Saudi Arabia. Also their in-house lawyers and foreign law firms.
- Can it be handled from outside Saudi Arabia?
- Yes. Usually, through a Saudi lawyer acting under a power of attorney. We tell you early if any step needs someone in person.
- What usually decides the route
- What the contract says, including where disputes go; what was registered with the Ministry of Commerce; and what you can prove.
- What you usually need first
- A short outline: who the Saudi party is, what the contract covers and what has gone wrong. No documents yet.
- First step with us
- Send that outline by WhatsApp, phone or email, before you send any notice.
- Working languages
- Arabic and English
Common situations we help with
We act in disputes with Saudi distributors, agents, contractors and suppliers, from ending a distribution agreement to unpaid project work. Start with the page closest to your question.
- Decide: ending a distributor relationship
How do you end a distributor or agent relationship in Saudi Arabia?
Usually in three stages: end the contract, remove the registration with the Ministry of Commerce, then appoint and register the new distributor. Check what the contract says and what was registered before you send any notice.
Ending a Saudi distributor or agent relationship - Act: unpaid project work
Not paid for work on a Saudi project: what can a subcontractor or supplier do?
The claim usually starts with the company you signed with, such as the main contractor. Your subcontract or purchase order, your payment record and the dispute clause decide the route.
Unpaid on a Saudi project: subcontractor and supplier claims
We are also writing pages on these questions:
How an agency or distribution agreement is entered in the Ministry of Commerce register, and removed from it.
Registering or deregistering a commercial agencyComing soonWhat a claim after an agreement ends usually turns on, and how the foreign company answers it.
When your Saudi distributor claims compensationComing soonWhat to check when a bond or bank guarantee on a Saudi project is called.
Performance bonds and guarantee callsComing soonHow payment works when a government body is the client.
Getting paid by government bodies and on public projectsComing soonHow the dispute clause in your contract shapes where a case is heard.
Arbitration, mediation or court with a Saudi counterpartyComing soonClaims for delay, for extra or changed work, and for work that was paused.
Delay, variation and suspension claims on Saudi projectsComing soon
A dispute with a Saudi business partner or co-shareholder is a different matter. It usually turns on the company’s own documents, so we cover it under foreign investment in Saudi Arabia.
How disputes with Saudi distributors and contractors usually work, step by step
Most disputes with a Saudi distributor, agent, contractor or supplier move through six stages. Not every dispute needs all of them, and the order can change.
Read the contract and check what was registered. Look at the clauses on ending the contract, on payment and on disputes. For distribution, also check the Commercial Agencies Register, the Ministry of Commerce’s record of agency and distribution agreements. Where a lawyer helps: reading the contract and the registration record together.
Keep everything in writing. Keep notices, approvals, delivery records, payment applications (formal requests to be paid for work done), emails and messages. They can be important evidence later, so keep them from day one. Where a lawyer helps: telling you which records matter most in your dispute.
Get advice before you send any notice. A notice is hard to take back, and its wording and timing matter. If you plan to change distributors, read ending a Saudi distributor or agent relationship first. Where a lawyer helps: checking the notice against the contract before it is sent.
Claim what you are owed, or agree a settlement. For unpaid work or goods on a project, see unpaid on a Saudi project. Claims for delay or extra work, bond calls and contracts with government bodies are separate topics. We are writing pages on each of them. Where a lawyer helps: putting your claim in writing, in Arabic, with the records behind it.
Use the route your contract names. That may be negotiation or mediation, a claim in the commercial courts, or arbitration. In mediation, a neutral person helps both sides agree. In arbitration, an arbitrator, not a judge, decides the dispute. Where a lawyer helps: reading the dispute clause before anything is filed.
Enforce the result, or answer a claim against you. A judgment or an arbitration award (an arbitrator’s decision) may need enforcing at the Enforcement Court, the court that enforces judgments and other enforceable documents. A former distributor may also bring a compensation claim after the agreement ends. Whether it has a basis depends on the contract, how the agreement was ended and the evidence on both sides. Where a lawyer helps: following the enforcement file, or preparing your answer to a claim.
Can you handle a dispute with a Saudi distributor or contractor without travelling to Saudi Arabia?
Usually, yes. A Saudi lawyer can act for you under a power of attorney that you sign in your own country. Saudi courts run most hearings electronically. We tell you early if any step needs someone in person.
A power of attorney (wakala in Arabic) is a signed document that lets someone, such as a lawyer, act for you. If you sign it abroad, it usually has to be certified before a Saudi authority will accept it. For a company, a person who can sign for it, such as a director, usually signs it in front of a notary.
Depending on the receiving body, documents from abroad are legalised by apostille or through a Saudi mission (an embassy or consulate). An apostille is a certificate that confirms the signature and seal on a public document. So before you pay for any certification, we confirm what the receiving authority accepts.
Najiz is the Ministry of Justice’s online platform for cases and powers of attorney. To sign in, Najiz uses Nafath, the Saudi government’s login app. Nafath needs a Saudi digital identity, which is linked to an ID issued in Saudi Arabia. So a foreign company usually acts through a Saudi lawyer, who files and follows the case.
Court work in Saudi Arabia is done in Arabic. The court usually needs certified Arabic translations of documents in other languages. Ask us before you pay for one.
What are the ways to resolve a dispute with a Saudi distributor or contractor?
There are 6 common routes: a negotiated settlement, mediation, a claim in the commercial courts, arbitration, a claim against a government body, and enforcing a judgment or award you already hold. Your contract’s dispute clause usually decides which route is open. Disputes with government bodies follow their own route, usually at the Board of Grievances. The SCCA’s own pages describe its arbitration and mediation services. The table below compares the routes in general terms.
| Route | When it usually fits | What you usually need | More detail |
|---|---|---|---|
| Negotiation and a written settlement | Both sides want to keep talking, or to end the relationship on agreed terms. | The contract, a record of what is owed, and a settlement put in writing. | Ending a distributor relationship |
| Mediation | Both sides agree to try a neutral mediator. Options include Taradhi, the Ministry of Justice’s online reconciliation platform, and mediation at the SCCA. | The other side’s agreement to take part, and a clear summary of the dispute. | Official sources below |
| A claim in the commercial courts | The contract names the Saudi courts, or names no other route. | Proof of the contract, of the work or delivery, and of what is owed. | Unpaid on a Saudi project |
| Arbitration | The contract names arbitration, at the Saudi Center for Commercial Arbitration (SCCA) or another body. | The arbitration clause, and the records behind your claim. | Page coming soon |
| A claim against a government body | The other side is a government body. Such disputes usually go to the Board of Grievances. | The contract with the government body and the payment record. | Page coming soon |
| Enforcing a judgment or award | You already hold a Saudi judgment, an arbitration award or another enforceable document. | The document itself, and the other side’s details. | Enforcement instruments |
This is a general comparison, not a ranking. The right route depends on your contract and your evidence. If your contract names foreign law or courts abroad, we read the clause and work on the Saudi side.
What should you prepare before contacting a Saudi lawyer?
A short outline is enough for a first message: who the Saudi party is, what your contract covers and what has gone wrong. Have these ready:
- The contract, purchase order or subcontract, and any amendments or side letters.
- The Saudi party’s legal name and its commercial registration (CR) number, if you have it. A CR is a business’s entry in the official commercial register.
- For distribution, whether the agreement is registered with the Ministry of Commerce.
- Invoices, payment applications and any approvals of your work.
- Notices you sent or received, with their dates.
- Key emails and messages about the dispute.
- What you have tried so far, and any reply from the other side.
Keep them ready — don’t send them yet. We tell you which ones to send after we agree to act.
How we help with distributor and contractor disputes
We act for the foreign company: the brand owner, manufacturer, contractor, subcontractor or supplier. Ideally, talk to us before you send any notice.
It starts with a short outline from you. We tell you whether we can help, what we need and how fees are agreed. Work starts only after an engagement letter, the written agreement between you and the firm, is signed.
We then read the contract, the registration record and the payment history. Under a power of attorney, we act for you in Arabic, the language Saudi courts work in. Depending on the dispute, that can mean sending notices, negotiating, mediating, bringing a claim or an arbitration, and enforcing the result.
No one can promise how a dispute ends. Before you decide, we tell you plainly what can be done, what it takes and on what written terms. Payment is arranged directly with the firm, never on this site. Raed AlJuhani is a licensed Saudi lawyer.
Frequently asked questions
Do we need a Saudi lawyer for a dispute with a Saudi distributor or contractor?
For a court claim or an arbitration in Saudi Arabia, usually yes. A licensed Saudi lawyer can act for you under a power of attorney, file a court claim through Najiz and attend hearings. Your own lawyers at home can work alongside us. See working with foreign law firms, insurers and advisers.
Does a distribution agreement in Saudi Arabia have to be registered?
Usually, yes. According to the Ministry of Commerce, agency and distribution agreements are registered in its Commercial Agencies Register. The register matters most when the relationship ends, because the old registration then has to be removed. The Ministry’s pages set out the current rules. See ending a Saudi distributor or agent relationship.
Court or arbitration: which applies to our dispute with a Saudi company?
Usually the one your contract names. If the contract names neither, a claim against a Saudi company can usually be brought in the Saudi courts. A clause that offers both court and arbitration can itself start a dispute about where the case belongs. So we read the dispute clause first.
Which rules apply to construction contracts in Saudi Arabia?
Your contract comes first. Many projects use contract forms based on international models, such as the FIDIC forms published by the international federation of consulting engineers. Saudi law can affect how some clauses work. The Civil Transactions Law sets general rules for contracts. How a particular clause is read is a question we answer from your contract.
What if the other side is a Saudi government body?
A different route usually applies. Such disputes usually go to the Board of Grievances, a separate court system for disputes with the state. Payments on public contracts run through Etimad, the government’s platform for procurement and payments to suppliers. The Ministry of Finance has also announced that the Council of Ministers approved a new Government Tenders and Procurement Law.
Our Saudi distributor took the goods and stopped answering. Whom do we claim against?
Usually the company named in your contract and in the commercial register. We check its commercial registration (CR) first, because the name on an invoice is not always the registered name. For the unpaid goods, see recovering an unpaid invoice from a Saudi company.
How much does a business dispute in Saudi Arabia cost, and how long does it take?
There is no standard figure or timeline. Both depend on the route, the evidence and how the other side responds. Court or arbitration fees may apply, and the official pages have the details. Our own fees are agreed in writing before any work starts. See how legal fees work in Saudi Arabia.
What about a dispute with our Saudi business partner or co-shareholder?
We cover that under foreign investment, because it usually turns on the company’s own documents, such as its articles of association (the company’s founding document). See investing in Saudi Arabia as a foreign company or investor.
Official sources
This page draws on 6 official sources. Each line shows who publishes it, its language and, where recorded, the date we last checked it.
- Ministry of Commerce · Ministry of Commerce Pending verification
- Saudi Center for Commercial Arbitration (SCCA) · Arbitration - Saudi Center for Commercial Arbitration (in English) · checked
- Saudi Center for Commercial Arbitration (SCCA) · Mediation - Saudi Center for Commercial Arbitration (in English) · checked
- Ministry of Justice · Taradhi, the Ministry of Justice's online reconciliation platform (in Arabic) · checked
- Ministry of Finance · Saudi Minister of Finance Thanks Leadership for Cabinet Approval of the New Government Tenders and Procurement Law (in English) · checked
- Etimad · Etimad (government procurement platform) Pending verification
General information about Saudi law, not advice on your situation. Contacting us does not create a lawyer–client relationship until an engagement letter is signed.