King Salman’s summit with Putin will set road map for new order

King Salman’s summit with Putin will set road map for new order
A file photo of Saudi Arabia’s King Salman and Russian President Vladimir Putin.
Updated 04 October 2017

King Salman’s summit with Putin will set road map for new order

King Salman’s summit with Putin will set road map for new order

RIYADH: As part of their pledge to ensure peace and security in the Middle East and the world at large, Saudi Arabia and Russia have set a course to build strong and pragmatic relations. King Salman’s visit to Russia, which begins on Thursday, will foster relations and establish a road map for collaboration, signaling yet another sea change in the ever-evolving global order.
In fact, Saudi-Russian relations are already at a high and cordial level, both in terms of shared interests and mutual understanding, despite differences over a few issues such as the Syrian conflict and the Iranian nuclear deal. But Riyadh and Moscow have renewed their commitment to narrow differences on such issues, as Riyadh moves ahead by adopting a more assertive line in its global and regional policy.
“The first ever official visit by a Saudi king to Moscow since the foundation of the Kingdom demonstrates that Riyadh is eager to keep a balance in its foreign policy and diversify its ties,” said Dr. Mona A. Almushait, a Shoura Council member.
“The Kingdom acknowledges the importance of Russia as a major global player, and its potential role in the region; and for Russia’s part, it is giving due importance to Riyadh’s political and strategic status in Russia-Arab relations.
“The Saudis see Russia in the role of a negotiator on all political issues including Syria and Yemen.”
While Saudi Arabia launched a military operation against Houthi rebels in Yemen, intensified support for Syrian rebels and cut diplomatic ties with Tehran, at the same time a visible trend in Saudi foreign policy was seen in its approach to Moscow. This was evident from the visit of Crown Prince Mohammed bin Salman to Russia in May, and the visit of Sergey Lavrov, the Russian foreign minister, to Riyadh last month.
Russia’s policy in the Middle East is multidimensional, and calls for building strategic relations with influential regional actors. Pursuing a partnership with Saudi Arabia is now a priority for the Russian Federation and its leadership, because the Kingdom is a leading country in the region, as well as in the international community.
Like Russia, the Kingdom is also a major player in the global oil market. Changes in the region and around the world, as well as the launch in April 2016 of the Saudi Vision 2030, open up new opportunities for the two countries. Both realize that the current status of political dialogue needs to be strengthened.
While the positions of Moscow and Riyadh on Egypt and Tunisia coincide, they differ over Syria, because they disagree on Iran’s policy. The June 2015 meeting between Russian President Vladimir Putin and Crown Prince Mohammed in St. Petersburg, and Putin’s meeting with King Salman in Antalya five months later, paved the way for more contacts and dialogue.
The two countries have similar positions on the resolution of the Middle East conflict based on the two-state solution. The convergence of Russian and Saudi positions was further promoted by Moscow’s decision to abstain from voting on Resolution 2216 on Yemen at the UN Security Council. Despite differences, Moscow and Riyadh are unanimous in their approach to stabilizing the situation in Lebanon and Iraq.
Russia is also well placed to talk to, or even mediate between, the Kingdom, Iran and Syria. For Saudi Arabia or even for the GCC and Arab League, Russia’s influence in Iran, Syria, Yemen, Turkey, and even Qatar, is a strategic asset. So Arabs, including Saudis, see Russia in the role of negotiator on all political issues.
As far as Egypt is concerned, the Kingdom and Russia welcomed the change of power in Egypt in 2013 and continue to support President Abdel Fattah El-Sisi. Egypt’s procurement of Russian weapons was possible thanks to Saudi financial assistance to Cairo. The Kingdom also seems to have appreciated Russia’s restrained position on the Yemen issue.
No doubt all these issues, including the Qatar crisis, will be on the agenda of the Russia-Saudi summit this week. Until now, Russia has not taken sides in the dispute between Qatar and other Arab states, and it has a recent history of cooperation with all sides of this conflict. As a result, Moscow can be an honest broker when it comes to intensifying efforts to resolve key regional conflicts, including Qatar.
Two years ago the two countries had virtually no dialogue on commercial issues, even energy. But now they have made a joint effort to push for further cutting oil production to help bring up global oil prices. Russia and Saudi Arabia are considering an OPEC deal extension and joint projects in the oil and petrochemical sector.
The Russia-Saudi summit is a milestone event to demonstrate that both countries are set for a much closer relationship. Russia and Saudi Arabia are showing the political will to foster bilateral economic ties, and their potential has yet to be fulfilled, Kremlin spokesman Dmitry Peskov said on Tuesday.
He said Russia had long-standing ties with Saudi Arabia, which Moscow valued. “There are very broad prospects, and the potential is far from being fulfilled. Now both sides are showing the political will to contribute to developing business contacts,” he said.
The issue of Iran was irrelevant, Peskov said. “Relations between Moscow and Riyadh are absolutely self-sufficient and in this case there is no need to draw any parallels, this is a separate vector of our foreign policy, given the important role of Saudi Arabia in the region and in the Arab world in general.
“Saudi Arabia is a country that plays a key role in Arab affairs. We in Russia seek to boost dialogue with Riyadh on various issues of common concern, including the current situation in the Middle East and in Syria in particular.”
The visit of King Salman at this critical time indicates that Russia has proved its presence in the Middle East and Moscow is giving due importance to Riyadh’s political and strategic status in Russia-Arab relations.


Overdue business rents waived by Saudi court

Overdue business rents waived by Saudi court
If a contract obliges one of the parties to carry out a task, which cannot be completed on time due to the pandemic, the court can temporarily suspend the implementation of the obligation. (SPA)
Updated 19 January 2021

Overdue business rents waived by Saudi court

Overdue business rents waived by Saudi court
  • The new regulations cover construction contracts, supply contracts, and the like, which have been affected by the pandemic

RIYADH: The General Assembly of the Saudi Supreme Court has ordered the waiving of overdue rents on businesses hit by the coronavirus disease (COVID-19) pandemic, and called for a review of such contracts between tenants and owners.

The steps have been taken in view of the circumstances caused by the pandemic, wherein an obligation or contract cannot be implemented without unusual losses.

The president of the Supreme Court, Khalid bin Abdullah bin Muhammad Al-Luhaidan, approved the decisions backed by 32 members of the assembly, Okaz newspaper reported.

Authorities have set conditions that have to be met before a case can be considered for review under the new regulations.

If a contract was concluded before the commencement of the preventive measures announced in the wake of the pandemic, then the impact was direct and unavoidable. If in such a case, an affected party was not compensated or did not reach a deal to mitigate the impact of the health crisis, then it qualifies for a review and the new regulations will then take effect, said legal sources.

The Supreme Court said a competent court will issue its verdict based on facts and circumstantial evidence, and may order amendments to a contract.

It also said the new provisions will be applicable to tenancy contracts and movable properties affected by the pandemic.

It clarified that if, due to the pandemic, a tenant was unable to use the leased property, in whole or in part, the court would reduce the rent as much as the usually intended benefit was reduced.

A lessor, meanwhile, does not have the right to terminate the contract if a tenant is late in paying rent for the period during which it was impossible to fully or partly use the property due to the pandemic.

HIGHLIGHT

The Supreme Court said a competent court will issue its verdict based on facts and circumstantial evidence, and may order amendments to a contract.

The new regulations also cover construction contracts, supply contracts, and the like, which have been affected by the pandemic.

If the pandemic causes an increase to the cost of materials and labor wages, etc., the court shall increase the value of the contract while ensuring the obligor can afford to bear the expense. The obligee, upon increasing the obligation, has the right to request the termination of the contract. If the increase in the cost of materials is temporary, the court reserves the right to temporarily suspend the contract.

If the pandemic causes a shortage of material in the market, the court can reduce the quantity to the extent it deems sufficient to protect the obligor from harm.

Moreover, if the shortage of materials is temporary, the court can temporarily suspend the contract if the person obligated to it is not severely affected by this suspension. If he is harmed, he may request termination of the contract. If the materials were not available at all, leading to the impossibility of implementing the contractual obligations or some of them, the court will terminate the clauses that are impossible to implement upon the request of one of the parties to the contract.

If a contract obliges one of the parties to carry out a task, which cannot be completed on time due to the pandemic, the court can temporarily suspend the implementation of the obligation. If the other party fears unusual damage due to the suspension, he may request termination of the contract.

In addition, the court also stressed the need to carefully assess the damages on a case-to-case basis, and that one or more experts should do the assessment. While assessing damages, it should be made clear what losses were incurred directly due to the pandemic and had nothing do to with seasonal upswing in certain activities.

The Supreme Court explained that a court is bound, when considering cases arising from contracts and obligations affected by the pandemic, not to apply penalty clause or fines in whole or in part — depending on the case.

In the event that a contract includes a clause of exemption from liability for one of the contracting parties when an emergency or force majeure occurs, the condition has no effect, and the party that breaches the obligation must provide evidence that the pandemic was the reason for the breach.

The affected contracts that are not covered by the provisions of this principle shall be subject to the legal and statutory litigation principles, said the court.

Commenting on the decision, Talal Albotty, the regional director of the Central Region, Salama Insurance Co., said there is a type of insurance called “suspension of operations” because of continuous epidemics, and falls under property insurance.

“This type of insurance can be found in European countries and some Asian countries but it is not applicable in Saudi Arabia,” he told Arab News. “The insurance against projects does not exist because when the project stops, insurance stops.”

Regarding the rise in prices of commodities, or the increase in prices because of pandemics and suspension of imports, a condition must be added stating that the value of property or project must increase by 10-25 percent, he added.

“Now most reinsurance companies around the world stopped offering insurance related to pandemics and contagious diseases in most countries, including COVID-19, because their impact was huge and the companies sustained huge losses,” he said.

Saudi lawyer Reem Alajmi said the resolution aims to treat and remedy the losses incurred by parties to the contract in terms of obligations.

“The parties could not fulfil their obligations because of a lack of sufficient resources or suspension of working hours during the pandemic. Fulfilling the obligation fully or partially was difficult because COVID-19 pandemic was a force majeure,” she told Arab News.

According to Alajmi, the effects or damage caused by the pandemic must not be covered by other laws. “Proving the occurrence of damage is the responsibility of the plaintiff and the defendant based on evidence submitted to the court,” she added. “The contracts and obligations are amended accordingly.”