Portsmouth Business School

Thesis summary

The purpose of this study is to critically examine the legal ramifications of Foreign Direct Investment in Saudi Arabia and its connection with the energy sector. Indeed, oil is the foundation for any future development, therefore, oil production and transactions must be regulated in all aspects to ensure that what has happened in the past will never be repeated and allow the government to learn from previous imperfections. It is the contention of this thesis that Saudi Arabias long and short-term policies need to be reformed. The task may only be successful if a root and branch consideration of such policies leads to constitutional reforms in order to enable development in accord with international trade law and practice. The study will lead to the identification and appropriate answers to the Saudi legal system starting from reforming the constitution as a new approach to accumulate economic development and to add a new partner to the globalisation trend. It is not intended to criticise Saudi policy or to undermine the real development that Saudi Arabia will accomplish in the future. Undoubtedly, any real development in any field of knowledge needs time, effort and special methods in order to reach the final goal and this has to correspond to the nature of society and cultural applications.

The environmental and human rights problems current in the world add extra pressures on the authority's funds and the development resources. The study proposes to trace the sources, origin and nature of these problems and sketch a picture of how these issues are likely to impact the resource sector in general. It seeks to address the issue of contractual and statutory approaches, self regulation and the possibility that command and control approaches would be adequate to address environmental and human rights problems as they affect the progress if there are no rules and regulations to be enforced. The study considers whether international law could act as a channel in providing innovative strategies specific to the resources sector, to overcome the environmental and human rights problems as well as ensuring the needs for optimal and profitable development are fully met. The overall objective is to contribute to the proper understanding of the nature of environmental and human rights problems as they affect the resources sector. It attempts to offer practical solutions, for the consideration of the Saudi policy makers. It would appear that the international community and trade pressure groups are the only service providers which can help to develop or apply the solutions within the natural resources sector.

There are considerable difficulties with which to contend when considering the present state of Saudi trade and investment laws as, due to the rather piecemeal development of law since the end of the Second World War there are many contradictions in national law and conflicts of law in the international arena. It seeks to show how the authorities can create the right environment to successful legal and economic application and universal value. Indeed, to comply with internationally recognised universal values the Saudi authorities should abolish any means or applications that misuse state power or wealth to harm others and to support efforts to achieve peace and sustainable development in the long term. Saudi Arabia, as a leading figure in the Islamic world, should look to other developed legal systems and their historical development path.

Many countries in the past were under religious control, yet they managed to enhance and reform their legal systems away from those prespectives.

An example which provides a conclusion is the present trend evident in Dubai that a two system, parallel legal environment, the family and criminal code being that of Islam and the commercial, trade and company law, when dealing with outside entities is based on the best aspects of both Common Law and such statute law as has from time to time been enacted in the United States of American and the laws of England and Wales. It is yet to be seen what long term effect the regulations of the European Union will have on international trade and investment with and into Saudi Arabia.