Saudi Arabia has enacted a new Enforcement Law under Royal Decree No. (M/237) dated 3/11/1447H corresponding to 20/04/2026 (the New Law). The New Law replaces the existing enforcement regime and is expected to take effect on 28 October 2026, 180 days after publication in the Official Gazette. The implementing regulations remain pending and are expected to provide further detail on a number of the new procedures.
The reform is a significant development for creditors, lenders, investors and companies doing business in the Kingdom. It places greater emphasis on asset-based recovery, introduces new requirements for certain negotiable instruments and strengthens the framework for digital enforcement and compliance. We set out below the principal changes and the practical points businesses should consider ahead of the effective date.
Greater emphasis on asset-based enforcement
The New Law places greater emphasis on identifying, disclosing and attaching a debtor’s assets, rather than relying primarily on measures directed at the debtor personally. For creditors, the practical focus is therefore increasingly on asset visibility and recovery.
This will be particularly relevant to corporate creditors, lenders and international investors. The New Law strengthens mechanisms for identifying assets, including enhanced disclosure obligations and, subject to the applicable procedures, access to information held by third parties connected with the debtor or its assets.
The New Law also permits certain enforcement functions to be carried out by licensed private-sector providers, including judicial sale agents and specialists in asset tracing and recovery. This may support a more specialised approach to complex enforcement matters, including those arising from international business transactions.
New requirements for promissory notes and bills of exchange
One of the most important changes for financing transactions concerns bills of exchange and promissory notes. Under the New Law, these instruments will generally need to be registered through designated national electronic platforms in order to qualify for direct enforcement. Cheques remain directly enforceable without the same registration requirement.
The change is relevant to corporate lending, project finance, trade transactions and other cross-border arrangements in which promissory notes are used as payment or security instruments.
Qualifying instruments issued before the effective date benefit from a transitional period and may remain enforceable for one year. Businesses should nevertheless review existing financing portfolios and documentation now. New financing arrangements should also address the registration requirement and any appropriate replacement mechanisms, subject to the forthcoming implementing regulations.
A ten-year period for enforcement instruments
The New Law introduces a ten-year period for accepting an enforcement instrument for enforcement, calculated from the date on which the instrument became due and subject to applicable statutory provisions. Creditors should therefore ensure that records relating to outstanding claims, judgments, awards and security instruments are complete and readily accessible.
The New Law also introduces a form of “reverse enforcement”, under which a debtor may, in certain circumstances, seek judicial intervention where a creditor refuses to accept performance of an established obligation. In addition, debtors may, subject to prescribed controls, be permitted to sell certain assets voluntarily to satisfy their liabilities.
Foreign judgments and cross-border transactions
The New Law retains the framework for the enforcement of foreign judgments and arbitral awards, subject to requirements relating to reciprocity, applicable treaties, due process, finality, jurisdiction and public policy.
This remains an important consideration for foreign investors, international lenders and multinational companies operating in or contracting with Saudi Arabia. The New Law refines the jurisdictional test by focusing on matters over which Saudi courts have exclusive jurisdiction and addresses circumstances in which substantially similar proceedings were commenced in Saudi Arabia before the foreign proceedings.
For international businesses, enforcement should be considered when a transaction is structured and documented, rather than only after a dispute arises. Governing-law provisions, dispute-resolution clauses, jurisdiction choices and the enforceability of foreign judgments or awards should be assessed at the outset of significant cross-border transactions. This is an important feature of the wider Saudi Arabia legal updates affecting international transactions.
Digital enforcement and increased compliance risk
The New Law forms part of Saudi Arabia’s broader digitalisation of judicial services. Electronic enforcement procedures are intended to support greater transparency, consistency and visibility in the enforcement process.
The New Law also strengthens the consequences of obstructing enforcement. Conduct such as concealing or transferring assets to frustrate recovery, refusing to disclose assets, providing misleading information or interfering with attached assets may result in substantial criminal penalties. Corporate groups and directors should therefore exercise particular care when considering asset transfers, restructurings or related-party transactions involving financially distressed entities.
What should businesses do now?
Before 28 October 2026, businesses should review their enforcement and credit arrangements. In particular, creditors should audit existing promissory notes and bills of exchange, review security documentation and update financing templates where necessary. Foreign investors and international businesses should also revisit cross-border dispute-resolution provisions and enforcement strategies, while companies more generally should ensure that procedures for preserving evidence, monitoring receivables and responding to enforcement notices are fit for purpose.
The New Law represents a material change in the Kingdom’s enforcement framework, with a clearer focus on asset visibility, digital processes and effective commercial recovery. The forthcoming implementing regulations will be important in determining how a number of these mechanisms operate in practice. Businesses with exposure to Saudi Arabia should use the period before the New Law takes effect to identify any changes required to their transaction documents, credit procedures and enforcement strategies.
