Policies & Procedures
Legal Department Policies & Procedures
Aligned with KSA Construction Laws, Mega Project Frameworks & International Best Practices
1. Introduction
The Legal Department at BEC Arabia is responsible for ensuring compliance, contract governance, risk management, and dispute resolution in alignment with KSA construction laws, FIDIC contract guidelines, and international legal best practices.
The Legal Policies & Procedures define the framework for contract execution, regulatory compliance, dispute resolution, and legal risk management to protect the company’s interests in mega projects and general construction contracts.
📂 Stored in SharePoint – Legal Policies & Procedures
2. Legal Compliance Policies
2.1 Regulatory Compliance Policy
Objective: Ensure that all contracts, agreements, and legal activities comply with Saudi laws and international construction regulations.
Applicable Regulations:
KSA Public Procurement Law (Etimad/NUPP)
Saudization & Labor Laws (Nitaqat System)
PIF Mega Project Guidelines (NEOM, Red Sea, Qiddiya)
VAT, Zakat & Withholding Tax Regulations
Anti-Bribery & Anti-Corruption Laws
Procedure:
Contract Compliance Review:
Verify all contracts against KSA Procurement & Construction Laws.
Conduct a pre-signing compliance audit for all contracts exceeding SAR 10M.
Regulatory Monitoring:
Assign legal liaisons to track updates from regulatory bodies.
Issue quarterly compliance reports to management.
Internal Compliance Audits:
Conduct annual compliance audits of contract execution & legal risk exposure.
Maintain audit reports in SharePoint for future legal reference.
📂 Stored in SharePoint – Compliance Reports
3. Contract Management Policies
3.1 Contract Drafting & Review Policy
Objective: Ensure that all contracts protect BEC Arabia’s legal and financial interests while remaining compliant with KSA laws.
Procedure:
Contract Initiation:
Identify contract type (Main Contract, Subcontract, JV Agreement, NDA, Consultancy Agreement).
Collect legal and financial information.
Contract Drafting:
Use approved FIDIC contract templates.
Include key legal terms:
Payment Terms & Performance Bonds
Liquidated Damages Clauses
Termination Clauses & Dispute Resolution Mechanisms
Internal Review & Approval:
Legal Team → Initial Legal Review
Finance → Financial Feasibility Check
Contracts Director → Final Approval
📂 Stored in SharePoint – Standard Contract Templates
3.2 Contract Execution & Filing Policy
Objective: Maintain proper documentation and digital records of all signed contracts to ensure accessibility and legal compliance.
Procedure:
Execution Process:
Secure client and subcontractor signatures.
Authenticate signatures via notarization (if required).
Digital Filing & Storage:
Upload signed contracts to Aconex & SharePoint.
Store physical copies in the Legal Department archive.
📂 Stored in SharePoint – Signed Contracts
4. Dispute Resolution & Claims Handling Policies
4.1 Dispute Resolution Policy
Objective: Resolve disputes efficiently and cost-effectively through mediation, arbitration, or litigation.
Procedure:
Pre-Litigation Resolution:
Conduct internal dispute analysis.
Attempt amicable negotiation with the opposing party.
Mediation & Arbitration Process:
Engage a third-party mediator if negotiations fail.
Refer the case to the KSA Arbitration Center if necessary.
Litigation Handling:
If arbitration fails, escalate the case to Commercial Courts in KSA.
Maintain all litigation records in SharePoint & Aconex.
📂 Stored in SharePoint – Legal Dispute Records
4.2 Claims Management Policy
Objective: Ensure structured handling of claims arising from contract breaches, variations, or disputes.
Procedure:
Claims Identification & Documentation:
Log the claim in the Legal Risk Register.
Gather contractual evidence, correspondence, and financial data.
Claims Review & Resolution:
Legal Team → Review validity of the claim.
Contracts Team → Negotiate claim settlement.
Escalation (If Required):
Unresolved claims are escalated to mediation/arbitration/litigation.
📂 Stored in SharePoint – Legal Claims Database
5. Legal Risk Management Policies
5.1 Legal Risk Assessment Policy
Objective: Identify legal risks in contracts, compliance, and disputes before they escalate.
Procedure:
Risk Categorization:
Contractual Risks: Payment delays, contract breaches.
Regulatory Risks: Saudization, tax compliance.
Dispute Risks: Arbitration and litigation cases.
Legal Risk Scoring:
Assign risk scores based on Likelihood (1-5) & Impact (1-5).
Escalate high-risk contracts to executive legal review.
📂 Stored in SharePoint – Legal Risk Register
6. Legal Documentation & Reporting Policies
6.1 Document Retention & Storage Policy
Objective: Ensure secure storage, access, and retrieval of legal documents for compliance and audits.
Procedure:
Storage Guidelines:
All signed contracts & legal documents must be stored for 10+ years.
Use Aconex for project-specific contracts.
Access & Permissions:
Restrict access to sensitive legal documents to authorized personnel.
Use digital rights management (DRM) for confidential agreements.
📂 Stored in SharePoint – Legal Document Archive
7. Legal Department Internal KPIs & Audit Procedures
KPI Name
Measurement
Target Benchmark
Contract Compliance Rate (%)
% of contracts meeting legal compliance
98-100%
Regulatory Audit Pass Rate (%)
% of contracts passing compliance audits
≥ 95%
Dispute Resolution Efficiency (%)
% of disputes resolved before litigation
≥ 85%
Legal Risk Score (High-Risk Cases)
Number of high-risk contracts flagged
≤ 10%
📂 Stored in SharePoint – Legal Audit Reports
Conclusion
The Legal Department Policies & Procedures at BEC Arabia provide a structured compliance, contract governance, and risk mitigation framework. By implementing these policies, BEC Arabia ensures legal protection, reduces risks, and strengthens contract governance.
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