RIYADH: Saudi Arabia has been continuously implementing and enhancing a complex infrastructure to foster its growing investment sector, further building its revenues and stimulating the economy.
The Kingdom’s efforts were a diverse assembly of critical legislation led by the Ministry of Investment to work its way up to the goals of its Vision 2030.
In February 2020, MISA was established to improve the Kingdom’s investment environment and fuel its development.
The ministry focused on “providing a safe and competitive investment environment, as well as developing investment laws and procedures with its partners from government entities, to complement the legislative and regulatory structure,” as stated in the most recent periodic report Economic Investment Monitor.
In April, the ministry announced that a new investment law was being drafted to provide equal treatment of local and foreign investors concerned with direct investments.
HIGHLIGHTS
In February 2020, MISA was established to improve the Kingdom’s investment environment and fuel its development.
In April, the ministry announced that a new investment law was being drafted to provide equal treatment of local and foreign investors concerned with direct investments.
As of the start of 2018, the government had changed Saudi Aramco’s status to a joint-stock company allowing it to issue shares and be regulated like other firms.
Other measures included the Premium Residency Center established in 2019.
MISA has also updated its regulatory regime for telecommunications with the approval of the new Communications and Information Technology Law.
The law also aims to protect intellectual property, confidential commercial information and personal data and provide access to the competent courts or arbitration centers in Saudi Arabia.
“By legally enforcing the principle of competitive neutrality to public and private investors, this removes any previous commercial barriers to entry. Whether you’re looking to expand your company’s presence or launch your brand for the first time, if you have a contract in hand, it has never been a better time to enter and invest in the Saudi market,” noted Paul Arnold, managing director of Sovereign Saudi Arabia, a corporate services provider based in Riyadh.
Legislative leap
Another legislative leap was the Saudi Arabian Oil Co.’s announcement and its bylaws.
As of the start of 2018, the government had changed Saudi Aramco’s status to a joint-stock company allowing it to issue shares and be regulated like other firms.
“This establishes the framework to allow future investors to hold shares in the company alongside its shareholder, the government,” a senior Aramco source, who declined to be named, told Reuters.
The Saudi government would remain “solely responsible” for the Kingdom’s production levels and had the “exclusive right” to make output decisions based on economic development, national security and foreign policy, noted the announcement made at the time.
Other measures included the Premium Residency Center established in 2019, which empowers Saudi nationals through developing competitive products, services and businesses for premium residency.
In an interview with Al Arabia TV, Crown Prince Mohammed bin Salman said that the new system will not undermine citizens’ rights. Rather, it will serve their interests.
He affirmed that the premium residency would be an important source of revenue to boost the Saudi economy and contribute to creating jobs for the public.
Analysts say the program will primarily benefit wealthy individuals who have lived in the Kingdom for years without permanent residency or multinational companies seeking to do long-term business in the Kingdom.
Judicial costs system
The judicial costs system was also set up in full effect in March 2022, which entails the imposition of fees when filing civil, commercial and criminal lawsuits borne by the convicted party or the party who loses the case.
Waleed bin Naif, a lawyer, told Arab News: “The judicial costs system objective is to reduce the overgrowth of malicious lawsuits, urge the documentation and proof of transactions and contracts, as well as directing litigants to resolve their dispute amicably.”
He added: “Judicial costs are imposed on the lawsuit in an amount not exceeding 5 percent of the value of the claim, with a maximum amount of SR1 million ($266,596), with defined regulations and criteria for estimating judicial costs.”
In addition, the Real Estate Registration Law was enacted to achieve Vision 2030 goals regarding real estate wealth development and the attractiveness of investment in the real estate sector.
Updating regulatory regime
MISA has also updated its regulatory regime for telecommunications with the approval of the new Communications and Information Technology Law, which integrates the community in the digital revolution, and the Companies’ Law, which boosts the value of companies and stimulates investment.
As for the Kingdom’s health sector, amendments to the executive regulations of the Health Institutions Law have been applied to effectively regulate the licensing provisions for health and private institutions and better manage health-related establishments.
MISA produced additional legislative regulations to develop the investment sector in the country – these include the Mining Investment Law, the executive regulation for Meteorology Law, and the Tourism Law 2022.
The ministry also developed regulations for foreign law firms’ licensing, adopted the new Custom Land Ports Storage Charges Rules and regulated Real Estate Transaction Tax.
Saudi Arabia is blossoming under Vision 2030 — the transformative economic and social reform blueprint launched by the crown prince in 2016.
Not surprisingly, it is becoming an unrivaled, fast-growing entrepreneurial landscape and a clear destination of choice, especially for businesses, as the government continues implementing reforms and regulations to attract more talent and operations to the Kingdom.
