Debt Collection in Saudi Arabia: Choosing the Right Legal Route

The current Enforcement Law

The current Enforcement Law and its implementing rules govern enforcement. Check the current requirements for your instrument rather than relying on an older guide.

If you are reading older guides, check the article numbers. Many of them refer to the old law.

Route 1: You hold an executive instrument

The Enforcement Law identifies the documents that can be enforced directly, without a lawsuit. They include:

• court judgments and orders;
• arbitral awards;
• attested contracts and acknowledgments;
• settlement records;
• cheques;
• bills of exchange and promissory notes registered on the national electronic platforms;
• foreign judgments and arbitral awards that meet the applicable enforcement conditions.

With one of these, you file an enforcement request. The debtor is notified and given a short period to pay before compulsory measures begin. See Enforcing a Judgment in Saudi Arabia.

Enforcement requests are subject to time limits and any applicable special rules. Check the due date and the current requirements promptly.

Route 2: You need a judgment first

Most debts are not backed by an executive instrument: an unpaid invoice, a verbal loan, money transferred to a friend. In those cases, you file a claim, obtain a judgment, and then enforce it.

• Business debts between companies may fall within commercial-court jurisdiction. Check the type of claim, any special jurisdiction rules and the applicable filing deadline. See How to Sue a Company in Saudi Arabia.
• Other debts may be subject to different jurisdiction and limitation rules under the Civil Transactions Law or other applicable provisions.

Lending money to a friend or colleague

Personal loans between expats are common, and they are often undocumented. You can still prove them, but you need evidence:

• bank transfer records showing the money sent;
• WhatsApp messages or emails mentioning the loan, the amount or repayment;
• any partial repayment, which supports the existence of the debt;
• witnesses to the arrangement.

Example: An Indian engineer in Jubail lent a colleague SAR 45,000 by bank transfer. The colleague later wrote on WhatsApp: "I will return the 45 in two months." After a year without payment, the engineer files a claim. He relies on the transfer record and the message as an acknowledgment of the debt.

Late-payment penalties

The Civil Transactions Law allows parties to agree compensation amounts in advance, except where the obligation is to pay a sum of money. A clause adding a fixed penalty to a late payment should therefore be reviewed carefully.

How to prepare a strong claim

1. Reconcile the debt: invoices, payments and the balance.
2. Collect acknowledgments: a signed statement of account, emails or messages confirming the amount.
3. Send a written demand with a deadline.
4. Choose the route: direct enforcement if you hold an executive instrument, a claim if you do not.
5. Act early: debtors' assets and willingness to pay rarely improve with time.

For debtors

If you dispute a debt, say so in writing with reasons. If you cannot pay in full, propose a written payment plan. Under the current Enforcement Law, concealing assets or obstructing enforcement can lead to criminal penalties.