Samer Choucair: Saudi Arabia”s Legal Market Has Become a Test of the Economy”s Ability to Retain the Highest Layer of Value
Investment expert Samer Choucair believes the accelerating transformation in Saudi Arabia's legal services market is no longer simply the result of more international law firms opening in Riyadh, but has become part of the reshaping of the non oil economy, as the Kingdom moves into a phase requiring the localization of knowledge, relationships, and decision making alongside the localization of economic activity itself.
Samer Choucair said major deals and giant projects generate hundreds of millions of dollars in legal and advisory spending, but the more important investment question isn't the size of that spending, it's who gets the mandate, who owns the client relationship, who makes the decision, and who retains the profit and expertise within the Kingdom.
Samer Choucair said: "An institutional investor isn't buying the presence of a law firm in Riyadh, they're buying a lower risk premium tied to contract enforcement. When the cost of negotiation and dispute resolution becomes a measurable part of the cash flow model, legal spending shifts from an administrative line item to a direct variable in capital allocation."
Choucair explained that the growth of the non oil economy and the expansion of foreign investment and government and private projects are increasing the need for more complex contracts, financing structures, partnerships, and mergers and acquisitions that require both local and international legal expertise at the same time.
Choucair noted that the Civil Transactions Law, which took effect in 2023, marks an important milestone in developing the legislative environment, since it provided a clearer framework for contractual relationships, helping investors assess legal risk and the cost of disputes more precisely.
Samer Choucair believes the market opening to foreign firms since 2023 has brought a large number of global legal institutions into Riyadh, but obtaining a license doesn't automatically mean the Saudi economy retains the highest value from the legal services chain.
Samer Choucair said: "The highest value isn't decided in the drafting room alone, it's decided by whoever owns the relationship with the party granting the mandate and whoever sets the governing law and liability structure. If that layer stays in London or New York, Riyadh executes and the return is distributed elsewhere."
Choucair emphasized that the partnership model between Saudi and international firms could be more effective if it leads to knowledge transfer, capability building, and localizing the client relationship, rather than being limited to executing work inside the Kingdom on behalf of foreign networks.
These shifts coincide with the expanding arbitration and dispute resolution market within Saudi Arabia. The Saudi Center for Commercial Arbitration has seen growth in both the number of cases and the value of claims, driven particularly by construction, services, and major projects, reinforcing the Kingdom's position as a growing hub for commercial dispute resolution.
Samer Choucair believes arbitration represents an additional channel for retaining value within the economy, since shifting administrative fees, expertise, and legal costs to the Kingdom builds a deeper professional sector and reduces the need to move disputes tied to Saudi projects to foreign centers.
Choucair added: "After localizing part of manufacturing and logistics, the next question is localizing professional decision making. An investor financing a twenty year project wants contractual and arbitral knowledge to sit close to the asset, not imported every time a dispute arises."
Samer Choucair noted that the greatest legal demand comes from project finance, energy, real estate, technology, capital markets, mergers and acquisitions, and projects tied to government and private investment, making the legal services market directly linked to the investment cycle in the Saudi economy.
Choucair believes the growth of assets under management and the development of the Saudi capital market are increasing the need for governance, disclosure, compliance, and regulatory advisory work, while the rise of artificial intelligence and legal technology is reducing the value of repetitive work such as research and initial contract review, and raising the value of expertise, professional judgment, and institutional relationships.
Samer Choucair warned that the success of this transformation depends on the market's ability to turn legislation into predictable practical outcomes, explaining that issuing regulations alone isn't enough if the length of disputes, inconsistent interpretation, or a shortage of published precedents continue to raise the risk premium.
Choucair said: "Capital goes where a contract can be priced, enforced, and restructured without surprises. The Saudi legal market is no longer just a story of professional openness, it's a test of the economy's ability to retain the highest layer of value in a knowledge economy."
Choucair believes the coming months and years could see more mergers between local and international firms, alongside growth in legal technology companies and specialized services in governance, compliance, and arbitration.
Samer Choucair concluded by saying: "Whoever builds the client relationship, resident expertise, and the arbitral seat holds the compounding return, and whoever settles for just executing the paperwork participates in the growth without owning it. So the real measure of success in localizing legal services isn't the number of firms that opened branches in Riyadh, it's the volume of knowledge, profits, and decisions that end up staying within the Kingdom."