|Subscribe to MEED|
On 12 November 2020, Sultani Decree 125/2020 was issued, with the aim of simplifying the litigation process in Oman in certain dispute areas through the introduction of a summary trial process to streamline the resolution of cases and avoid prolonged, expensive court processes.
The decree comes into force in February 2021 and the changes will have a significant impact on how disputes are dealt with through the courts.
The recent decree only applies to certain types of disputes. The core areas dealt with under the new law are commercial disputes involving investment projects subject to Oman’s foreign capital investment law (FCIL), construction cases, disputes arising out of debt-creating instruments, tenancy disputes relating to both residential and commercial leases, individual employment disputes and criminal cases related to cheques that are not related to any other criminal act.
The decree establishes preliminary, fast-track hearings for these core dispute areas. Before the introduction of the new law, the courts were struggling to cope with a large rise in cases amid the Covid-19 pandemic, which was further exacerbated by the closure of government offices during Oman’s period of heightened restrictions.
This legislation introduces a new 30-day timeline from the date of submission of the case within which judgements must be handed down. If necessary, this is can be extended once, by a further 30 days, except for judgements relating to commercial disputes subject to Oman’s FCIL and construction cases, which may be extended to four months from the date of referral.
This legislation introduces a 30-day timeline for the handing down of judgements
The new law also significantly changes the appeals process for any cases in the core dispute areas by making appeals court decisions final and not subject to further supreme court appeals.
The timescales and grounds for appeals are also much more restrictive. Parties will have up to 15 days from the date of the primary court’s judgement to appeal. The appeals court must then list, hear and issue its judgement within 30 days of the date of the referral.
Once again, for commercial disputes subject to the FCIL or construction cases, the period in which an appeal judgement must be handed down may also be extended to four months.
Once decided by the appeals court, these cases cannot be further appealed, except in commercial disputes concerning investment projects subject to the FCIL with a case value of more than RO150,000 ($389,611).
The recent decree also sets out stipulations that must be met in order for a case to be considered by the appeals court, with article 12 of the new law outlining the grounds for appeal.
According to the new legislation, a special circuit will be constituted in each primary court, consisting of only one judge. This judge will have sole jurisdiction to make orders relating to any of the core dispute areas. An appeals circuit will also be constituted in every court of appeals to deal with judgements handed down by the primary courts.
Litigants may enter pleas challenging the jurisdiction of the summary process, subject to a deadline of eight days for the primary court and 15 days for the appeals court.
Article 20 of the new law requires that cases in the core disputes areas that are currently under review at the primary courts across the sultanate are immediately referred to the fast-track judge.
Another significant change is the acceptance of electronic legal notification, with article 18 allowing court documents to be served on parties via text message or any other form of electronic communications that is capable of being saved and retrieved.
The introduction of the summary process is a major change to the existing court litigation process, and has long been anticipated, particularly in relation to labour and rent disputes. For the other core dispute areas, the promise of more rapid resolution will surely be welcomed by businesses in Oman.
Despite the restrictions on appeals, there remains a route to the supreme court for disputes in excess of RO150,000, as well as opportunity to raise jurisdictional challenges.
As only a single judge will be presiding over cases under this new court track, it is unlikely that there will be specialist judges for the respective core dispute areas, so the judges will need to be competent in the range of sectors.
Though it remains to be seen how judges will cope with this new system, it will undoubtedly help to speed up decisions and avoid a lengthy, expensive process.
There are still several issues in the new law that require clarification, particularly in relation to the areas where disputes can avoid the courts entirely and head straight for enforcement.
Regulations providing clarity will be issued by the chairman of the Council for Administrative Affairs of the Judiciary in due course.
About the authors
By Thomas Wigley, partner, and Raya al-Harthy, senior associate, at the Oman office of law firm Trowers & Hamlins
MEED provides exclusive news, data and analysis on the Middle East every day. For access to MEED’s business intelligence, subscribe here
More from MEED's leadership library
> UK-Gulf relations ripe for green tech collaboration
Simon Penney, Her Majesty’s Trade Commissioner for the Middle East
> Levelling the financial playing field
Anouar Bourakkadi Idrissi, CEO of Edenred UAE
> The GCC's green hydrogen opportunity
Ulrich Koegler and James Thomas, partners, and Susie Almasi, executive advisor, at Strategy& Middle East
> The myth of the cashless economy
Samer Srouji, director at Tanmia Capital
A MEED Subscription...
Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.