The Kingdom of Saudi Arabia is the largest Arabic gulf state in terms of population and GDP. It is therefore a key market for businesses entering the Middle East region. However, it can be a country which poses difficulties both in general terms of doing business, as well as for the protection of intellectual property rights.
With a population of almost 31 million people, which increases significantly during the Hajj (the Islamic pilgrimage to Mecca), businesses are keen to be able to commercialise their products and services in the Kingdom.
The Kingdom has an absolute monarchy. It is now ruled by His Highness Salman bin Abdulaziz Al Saud, following the passing of King Abdullah in January 2015. Historically, the Kingdom has been the world’s largest oil producer before recently being overtaken by the USA.
This article provides an introduction to some of the intellectual property issues to be aware of in this key jurisdiction.
Sharia and intellectual property
The Kingdom of Saudi Arabia is one of the most conservative countries in the world. Its legal system is based on Sharia principles, derived from the teachings of the Quran and the Sunnah. There is no system of binding precedent, with judges having the power to use independent legal reasoning to reach a decision in any matter.
In recent matters we have handled before the Saudi Courts, the Judges have outlined how and where Sharia can apply to intellectual property rights.
In relation to the question of confusion between potentially conflicting trade marks, the Courts have commented that:
"…there is similarity between the marks. This similarity leads to confusion among consumers and causes damage to them. Sharia prohibits the infliction of such damage based on the principle "no harm shall be done, nor harm done in return"…"
The Courts have also stated that such protection is confirmed in Islamic jurisprudence:
"…which calls for protecting rights and properties of all types, including trade marks…".
As well as the Courts, leading Islamic academic institutions have provided their views on the impact of Sharia and intellectual property rights. This was addressed by the Islamic Fiqh Academy (an academy for the advanced study of Islam) which during its Fifth Summit in Kuwait:
"…classified moral rights as protected financial rights that are governed by the Sharia practices with regards to property… trade names, trade addresses trade marks, authorship, inventions and innovations are all rights which belong to their owners and have in the present day customs a financial value. Such rights are recognised in Sharia and shall not be infringed upon…"
However, the principles largely revolve around "ownership". Issues can arise where the rights being relied upon are unregistered rights, particularly in cases where registrations are not held in Saudi Arabia. In such cases the Courts may question whether unregistered rights can "belong" to the owner.
We look further below into issues which IP owners commonly face in Saudi Arabia. In our experience, it is possible for protectable intellectual property rights to be created, recognised and protected in Saudi Arabia, and thereby unlocking the potential to one of the most important markets in the region.