Omani Supreme Court adopts a pro-arbitration approach by affirming the Omani courts' lack of jurisdiction to hear challenges to foreign arbitral awards

Oman’s strategic location and developing economic environment make it an increasingly significant jurisdiction in the Middle East. As Oman continues to diversify its economy and attract foreign investment, the predictability of its legal and dispute resolution framework for cross-border commercial disputes will also become of greater significance. For international businesses and investors, this includes the approach taken by the Omani courts to international arbitration, particularly in determining which courts have supervisory jurisdiction and how foreign arbitral awards are treated and enforced.

There had been concerns in recent years over the expansive view taken by the Omani courts of their judicial jurisdiction over foreign arbitral awards. In a June 2023 ruling, the Omani Supreme Court was prepared to examine annulment challenges to awards even where the arbitration was seated outside Oman. Applying Article 29 of the Omani Civil and Commercial Procedures Law,¹ the Court concluded that because the award debtor, Vijay Tanks & Company LLC ("Vijay Tanks") was an Omani company, the Muscat Court of Appeal had jurisdiction to hear an annulment claim. This was notwithstanding the fact that: (1) the arbitration was concluded under the ICC Rules; (2) the award was seated in London; and (3) the dispute concerned a project in Qatar.² The Supreme Court therefore annulled the earlier judgment of the Court of Appeal declining jurisdiction over the challenge and remanded the case back to the lower court for consideration of the substance of Vijay Tanks' challenge. 

The annulment challenge was ultimately dismissed when it reached the Supreme Court again in November 2024, following the subsequent decision of the Court of Appeal and review of the grounds of Vijay Tanks' challenge.³ However, from an international arbitration perspective, that approach sat uneasily with the orthodox position under the UNCITRAL Model Law on International Commercial Arbitration ("UNCITRAL Model Law")⁴ and the territorial framework of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (the "New York Convention")⁵ because it meant that the Omani courts may still purportedly exercise powers reserved for the courts of the seat.

The issue re-surfaced in relation to a more recent attempt to have a foreign award enforced in Oman. In November 2024, Withers successfully secured an ICC award in a London-seated arbitration for the claimant, Galfar Al Misnad Engineering & Contracting WLL ("Galfar"), against the same respondent Omani company, Vijay Tanks. As Vijay Tanks failed to pay the awarded sum, Withers, on behalf of Galfar, instructed Omani counsel, Ali Al Rashdi of Bait Al Qanoon, to commence the recognition and enforcement process in Oman, Vijay Tanks' home jurisdiction.

After the award was successfully recognised and enforced in Oman, Vijay Tanks sought to delay execution by challenging the ICC award before the Omani courts (as opposed to London, at the seat of arbitration).  The annulment challenge was brought before the Muscat Court of Appeal which concluded in March 2026, that it lacked jurisdiction ratione materiae to hear the challenge. Dissatisfied with the result, Vijay Tanks appealed the Court of Appeal judgment before the Omani Supreme Court, which had previously entertained its earlier challenge in 2023 to the ICC award rendered in favour of Cape East. In its appeal, Vijay Tanks argued that the Muscat Court of Appeal erred in law by limiting the application of Royal Decree No. 47/1997 issuing the Arbitration Law in Civil and Commercial Disputes (the "Omani Arbitration Law") to arbitrations seated in Oman and excluding arbitrations conducted abroad unless the parties agreed to the application of Omani law.⁶

In an important judgment issued on 19 May 2026, however, the Omani Supreme Court rejected the appeal from the outset – taking a notable shift from its earlier approach in 2023. Finding in favour of Galfar, the Omani Supreme Court held that Vijay Tanks' grounds of appeal were unfounded. It considered that Article 1 of the Omani Arbitration Law confined the application of the Omani Arbitration Law to: (1) arbitrations conducted in Oman; and (2) international commercial arbitrations seated abroad where the parties expressly agree that the Omani Arbitration Law shall apply.⁷

The Omani Supreme Court further observed that where parties agree to arbitrate under the rules of a particular arbitral institution, the arbitration procedure is governed by that institution's rules. The parties may also choose the substantive law applicable to the dispute, and the tribunal must apply their chosen law. Further reinforcing its alignment with conventional international arbitration practice, the Omani Supreme Court highlighted the legal significance of the seat of arbitration which it confirmed determines which courts have supervisory jurisdiction over the arbitration and are competent to hear challenges to the award.

Looking closely at the wording of the arbitration agreement of the parties and the arbitral process, the Omani Supreme Court concluded that the parties had expressly agreed for the ICC Rules to apply, the arbitration to be seated in London, English law to govern the arbitration, and Qatari law to govern the substance of the dispute. Thus, since the arbitration was seated outside Oman and the parties had not agreed that it would be governed by the Omani Arbitration Law, the Omani courts lacked jurisdiction to entertain an action seeking annulment (set aside) of the foreign arbitral award.

As a civil law jurisdiction, Oman does not strictly adopt a doctrine of binding precedent. Nonetheless, the 2026 Omani Supreme Court judgment represents a departure from the nationality-based approach to jurisdiction taken by the Supreme Court in 2023, in favour of an approach based on the seat of the arbitration. The judgment provides greater clarity for parties seeking enforcement in Oman. In particular, it indicates that if the correct framework pursuant to the Omani Arbitration Law and the New York Convention is applied, foreign-seated awards should not be susceptible to a challenge before the Omani courts on the basis of the jurisdictional approach previously applied under the Omani Civil and Commercial Procedures Law. The judgment, therefore, brings the Omani court's approach more closely into line with international arbitration practice, the UNCITRAL Model Law and the New York Convention, to which Oman has been a contracting State since 1999.⁸