The Riyadh Commercial Court of Appeals issued a significant ruling today, overturning a previous lower court decision that had determined commercial courts lacked subject-matter jurisdiction to hear the case filed by Tawariyat Medical Care Company against the petrochemical giant, Saudi Basic Industries Corporation (SABIC). Under this new ruling, the case file has been returned to the competent court to begin reviewing and adjudicating the dispute.
Details of the financial and contractual dispute
In an official statement published on the Saudi Stock Exchange (Tadawul) website, Tawari’at Company revealed that this legal development is a continuation of the lawsuit filed on November 23, 2025. The case revolves around financial claims amounting to approximately SAR 34.5 million, representing financial differences resulting from what the company described as SABIC’s failure to provide the minimum number of medical examinations stipulated in the contract between the two parties.
These claims cover the period from 2019 to 2024, as “Tawari’iyat” claims that the contract obliges the second party to a minimum level of operation that has not been met, which necessitated resorting to the judiciary to preserve the rights of the shareholders.
Timeline of the case
The commercial courts witnessed procedural wrangling in this case. On November 26, 2025, the company announced a preliminary ruling of lack of subject-matter jurisdiction, meaning the court deemed the nature of the dispute outside its purview. However, the company's legal team acted swiftly, filing an appeal on December 10, 2025, which culminated in today's appeal ruling, paving the way for a discussion of the merits of the case.
Legal context and development of commercial law
This ruling is particularly significant given the rapid developments within the Saudi Arabian judicial system, specifically in the commercial courts. Modern regulations aim to broaden the jurisdiction of commercial courts to encompass all disputes arising between merchants or companies, thereby ensuring swift resolution of economic cases and fostering a more favorable investment climate.
Legal experts confirm that reconsidering the case reflects the accuracy of the Courts of Appeal in classifying lawsuits, and their keenness to ensure that formal defenses (such as jurisdiction) do not hinder the achievement of effective justice, especially in major service contracts between joint-stock companies.
Economic impact and transparency
From an economic perspective, the disclosure by listed companies like "Tawari'iyat" of details regarding pending cases reflects a high level of transparency and governance mandated by the Capital Market Authority. Such disclosures are crucial for investors, as the financial outcomes of these cases directly impact companies' financial statements, both in terms of potential provisions and projected cash flows should the case be won.
