| These updates are produced by Johnson and Pump Law, in Association with Al Sharif Law. We encourage you to share with others, who can sign up directly via this link. A new Companies Law took effect January 19, requiring constitutional documents to be filed electronically through an MoC “Saudi Business Center” based on MoC templates (“Mowa’mah” i.e. “company alignment,” Art. 227.2). While already mandatory, this remains a work in progress; companies must now register, amend or restate their AoAs in accordance with still emerging online procedures and substantially inflexible MoC templates, with a January 16, 2025 deadline for full compliance. We look forward to advising and supporting our esteemed clients through this potentially challenging transition if and as needed; please let us know Upcoming Saudi Holidays, Events, Webinars, and Conferences Global Real Estate Summit 42nd edition (Riyadh): December, 2023 World Defense Show: February 4-8, 2024. For Riyadh-based business events, see: U.S.-Saudi Business Council (USSBC) U.S. International Trade Administration (ITA) Saudi British Joint Business Council (SBJBC) Public Sector and Significant Updates Expo Bid: Saudi Arabia is launching a major push to host the 2030 World Expo in Riyadh, allocating $7.8 billion to the project. Corporate / Labor and Major Reports Domestic Worker Regulations: The Saudi Ministry of Human Resources and Social Development has issued new regulations to protect domestic workers. Penalty for Hiring Illegals: The Ministry of Interior (MoI) has announced that employers caught hiring illegal expats will be fined SAR 100,000. Qiwa Payment Options: The Qiwa platform now allows work permit fees to be paid via credit cards and mada debit cards. Legal Reference: Al Tamimi Legal Magazine: For Al Tamimi Law’s latest magazine issue (focus is on real estate, construction, and hospitality), see here. Saudi Updates: New Civil Transactions Law: The Saudi government has recently enacted a new Civil Transactions Law, set to take effect on December 16, 2023. SAMA Insurtech Rules: The Saudi Central Bank (SAMA) has approved new Insurtech Rules. Law of Payments Implementing Regulations: SAMA has issued the Implementing Regulations for the Law of Payments and Payment Services. VAT Amendments: The Zakat, Tax and Customs Authority (“ZATCA”) has approved amendments and additions to the VAT Implementing Regulations. Tax Amnesty Extension: ZATCA has announced the extension of its “Cancellation of Fines and Exemption of Penalties” tax amnesty initiative until December 31, 2023. Upcoming Real Estate Regulations: The Real Estate General Authority (REGA) said the executive regulations of the real estate contributions law will be issued in the next two months. Industry: No significant recent developments. Visas, Travel, and Airline Industry Reference: Travel Guidance: For up-to-date travel information, visit the U.S. State Department’s Saudi-specific COVID-19, alerts and messages, travel info, travel advisory, and security report pages. For the UK’s travel advice, see here. For Ministry of Health’s guidance, see here; COVID statistics are published on the ministry’s Dashboard. For Saudia’s travel guidelines, see here. Visa Updates: No significant recent developments. Industry Updates: Saudia Airbus Purchases: Saudia announced it will acquire 20 Airbus A321neo aircraft as part of its expansion plans. Business / Economy General Economic: Dashboards (for reference): GASTAT, SAMA, AGSIW Economic Barometer, S&P, Moody’s, IMF, World Bank, EIU, Argaam. Macroeconomic summaries at the U.S.-Saudi Business Council. IMF Forecast and Oil: The IMF predicts that the Saudi economy will expand just 1.9%in 2023, down 1.2 percentage points from the fund’s earlier estimate, due to oil production cuts. Saudi Arabia is set to lose its spot as the largest oil producer in the OPEC+ alliance as its production cuts begin to bite, tightening the oil market just as prices appear to be turning higher. The Kingdom is expected to extend a 1 million-barrel oil supply cut into September as it seeks to foster a tentative recovery in crude prices. For a deeper analysis of oil price strategies and market turbulence, see here. Construction and Tourism Boom: Non-oil business activity in Saudi Arabia surged in June, supported by strength in construction and tourism. General Business: BlackRock Board Seat: The CEO of Aramco is joining BlackRock’s board of directors. Public Investment Fund (PIF): 2022 Net Loss: The PIF reported an $11 billion investment loss for 2022, compared to a $19 billion gain in 2021. Brazil Mining Investment: Maaden, the Kingdom’s state mining company, is joining the PIF in buying a 10% stake in Brazil’s Vale SA’s base metals unit for $2.6 billion. Tourism Company: The PIF has launched the Saudi Tourism Investment Company (Asfar) that will invest in new tourism projects and develop attractive destinations with hospitality, tourist attractions, retail, and food and beverage offerings across the Kingdom. Events Investment: The PIF has partnered with the Events Investment Fund (EIF) to acquire a significant stake in Tahaluf, a Saudi-Arabia-based large-scale live events company. Sports Investment Company: Saudi Arabia reportedly plans to launch a multibillion-dollar investment company to expand its sports interests. Camel Dairy Company: The has established the Sawani Company to support the growth of the local camel farming industry. Coffee Academy: The Saudi Coffee Company, a PIF subsidiary, is launching an academy for training in the coffee industry. Madinah Date Company: The PIF has established the Al Madinah Heritage Company to develop and boost production of Ajwa dates in the Madinah region. Oman Investment Authority MoU: The PIF has signed an MoU with the Oman Investment Authority (OIA) to strengthen collaboration between the two entities. Engie MoU: The PIF has signed an MoU with French energy company Engie that focuses on integrated utilities management and will explore the joint development of green hydrogen projects and derivatives in Saudi Arabia. Nesma Acquisition: PIF-backed Saudi firm Nesma & Partners has signed an agreement to acquire Dubai-based privately-owned energy services firm Kent. Finance, Insurance, VC, and Investment: SAMA-HKMA Collaboration: The governors of SAMA and the Hong Kong Monetary Authority (HKMA) met to explore cooperation in financial infrastructure development, open market operations, monetary policy, and Fintech. Real Estate, Construction, Infrastructure, and Megaprojects: Foreign Real Estate Ownership: Some analysts warn that the lifting of restrictions against foreign ownership of real estate may exacerbate housing affordability issues. NEOM Loan: Neom is reportedly looking to raise a $2.7 billion loan to fund the early stages of the project. Industry, Utilities, Transportation, Logistics, and Non-Oil Energy: New Industrial Projects: Saudi Arabia has approved 99 new industrial projects in May with a combined value of around $5.4 billion, according to official figures. Hyundai Power Line Deal: Hyundai has signed a contract with Saudi Electricity Company (SEC-COA) to build a high-voltage direct current (HVDC) power transmission line in the Kingdom. Tourism, Hospitality, Culture, Sports, and Entertainment: 2027 Arab Games: The Minister of Sports welcomed Arab delegations participating in the 16th Arab Games, which will be hosted by the Kingdom in 2027. Soccer Recruitment: Saudi soccer club Al-Hilal is preparing to make a $1.1 billion offer to sign striker Kylian Mbappe from French club Paris Saint-Germain. AI-Generated Livery: The NEOM McLaren Formula E Team unveiled a world-first with its motorsport livery designed using generative AI. Retail, Luxury, and E-Commerce: No significant recent developments. Religion: Umrah Insurance Provisions: The Ministry of Hajj and Umrah has announced that the Umrah insurance policy for international pilgrims offers coverage with benefits of up to SAR100,000. Science and Education: King Saud University Conversion: Crown Prince Mohammed bin Salman issued a Royal Order transforming King Saud University into an independent, non-profit academic institution under the “umbrella” of the Royal Commission for Riyadh City. Healthcare: No significant recent developments. Technology and Telecom: STC Record Revenues: STC Group has achieved its highest semi-annual revenues in its history, reaching $9.73 billion, up 8.17% from last year. Defense: Turkish Drone Deal: Saudi Arabia agreed to buy Turkish drones in the biggest defense contract in Turkey’s history during President Erdogan’s recent visit to the Kingdom. German Eurofighter Export Ban: German Chancellor Olaf Scholz stated that Germany will not deliver Eurofighter combat aircraft to Saudi Arabia in the near future. Food and Agriculture: No significant recent developments. Natural Resources, Mining, and Environment: Amak Copper and Zinc Plant: Saudi mining company Amak has announced that its new copper and zinc plant is in its final stages of construction. Oil, Hydrocarbons, and Aramco: Oil prices most recently stood on August 1, 2023 at $88.23 pbb for Saudi oil (Arab Light) and $81.43 pbb for West Texas Intermediate (WTI). Pakistan Refinery: Pakistan’s four state-owned oil companies have signed an MoU with Aramco to build a $10 billion greenfield oil refinery at Gwadar Port in Balochistan. New Drilling Rigs: The Arabian Drilling Co. (ADC) announced the signing of long-term contracts to build ten onshore drilling rigs with Aramco. Rongsheng Petrochemical Stake: Aramco has successfully closed a landmark $3.4 billion transaction to acquire a 10% interest in Rongsheng Petrochemical Co. Plastic Waste to Oil Conversion: Aramco, TotalEnergies, and SABIC have successfully converted oil derived from plastic waste into ISCC+ certified circular polymers. Geopolitical Ukraine Peace Talks: Saudi Arabia is set to host peace talks among Western countries, Ukraine and key developing countries, including India and Brazil, later this month. Tunisia Loan: Saudi Arabia is lending $500 million to Tunisia to support the country’s economy. Yemen Aid: Saudi Arabia is giving Yemen’s presidential council $1.2 billion to help the country’s struggling economy. Pakistan Aid: Saudi Arabia has given $2 billion in aid to Pakistan. Japan Ties: Japan and Saudi Arabia on Sunday agreed to launch a strategic dialogue between foreign ministers that will cover a wide range of issues, from national security to the economy. The two countries recently decided to jointly invest in rare earth mines. MBS UK Invite: The UK government has invited Crown Prince Mohammed bin Salman to London as Britain seeks to deepen its ties with the Kingdom and lure investment. Israel Potential Rail Link: Israel will build a $27 billion rail expansion that will connect its outlying areas to metropolitan Tel Aviv and, in the future, could provide overland links to Saudi Arabia. Gulf UAE: Travel Information (reference): For current information from the U.S. Embassy in the UAE, see here and for travel information see here. FDI Growth: FDI flows into the UAE rose 10% in 2022 from the previous year to a record $23 billion according to a UN report. Financial Crime Initiatives: The UAE has announced new federal prosecution entities for economic crimes and money laundering. Abu Dhabi Diversification Push: Abu Dhabi announced plans to double the contribution from its industrial sector to its GDP as it seeks to diversify away from oil. Business Chamber Expansion: The Dubai International Chamber has announced aggressive plans to hold roadshows across the world to cultivate business opportunities. Energy Investment Plans: The UAE plans to triple its supply of renewable energy and invest up to $54 billion over the next seven years to meet its growing energy demands. India Rupee Deal: India has signed an agreement with the United Arab Emirates that will allow it to settle trade in rupees instead of dollars. India Oil Deal: Adnoc announced a 14-year supply agreement valued at between $7 billion and $9 billion with Indian Oil Corporation Limited. Turkey Deals: The UAE and Turkey signed several deals estimated at $50.7 billion during a visit by President Tayyip Erdogan to Abu Dhabi. Israel Industrial Deal: Israel and the UAE have signed an agreement to foster business and manufacturing ties and boost relations with institutions in industry, trade, and investment. Congo Mining Deal: The UAE has signed a $1.9bn deal with a state mining company in the Democratic Republic of the Congo (DRC) to develop at least four mines in eastern Congo. Qatar: Travel Information (reference): For current information from the U.S. Embassy in Qatar, see here and for travel information see here. Energy Profit Surge: Qatar Energy has reported a $42.47 billion net profit for 2022, a 58% rise. Qatar Airways Profit: Qatar Airways has earned a profit of $1.2 billion over the past fiscal year, boosted in part by the country’s hosting of the 2022 FIFA World Cup. Kuwait: Travel Information (reference): For current information from the U.S. Embassy in Kuwait, see here and for travel information see here. New Sovereign Wealth Fund: Kuwait plans to establish a new sovereign fund to develop its local economy, spearhead mega projects, and attract funds from foreign investors and the private sector. Budget Recovery: Kuwait ended nine straight years of budget deficits as a boom in oil revenue and more controlled spending delivered a surplus of $21 billion for the year through March, after revenue gained 55% on the previous year. Energy Expansion: Kuwait plans to boost its crude oil production capacity to 3.15 million barrels per day (bpd) within four years, from 2.7 million bpd now and raise its natural gas production by 79%. Kuwait’s oil minister announced the country will invest more than $300 billion in the energy sector by 2040. Bahrain: Travel Information (reference): For current information from the U.S. Embassy in Bahrain, see here and for travel information see here. IMF Forecast: The IMF predicts Bahrain will experience a GDP growth rate of 2.7% in 2023, with non-oil GDP growing by 3.3% reflecting fiscal consolidation, higher interest rates, and a base effect from 2022 strong growth. UK Investment Deals: Bahrain has signed an MoU for strategic investments and collaborations with Britain that will see the Gulf state’s private sector invest $1.3 billion in the UK. Oman: Travel Information (reference): For current information from the U.S. Embassy in Oman, see here and for travel information see here. New Labor Law: Oman has announced a new Labor Law which provides greater protections for employees. Regional No significant recent developments. Miscellaneous and Interesting Jordanian Royal Marriage: Jordan’s Crown Prince Al Hussein bin Abdullah married Saudi engineer and member of the Saudi royal Sudairi family Rajwa Al-Saif. Resources: Previous newsletters and articles Saudi Arabia’s Unified National E-Government Platform Saudi Press Agency Vision 2030 Events: Many Saudi business events are posted on Meetup, Eventbrite, and PredictHQ. COVID: Ministry of Health Dashboard Ministry of Health Coronavirus Guidance Trade and business organizations: U.S. Commercial Service Saudi Arabia (ITA) U.S.-Saudi Business Council (USSBC) Saudi-U.S. Trade Group (SUSTG) (see also The 966 Podcast) AmCham Saudi Arabia Saudi British Joint Business Council (SBJBC) German-Saudi Arabian Liaison Office for Economic Affairs (GESALO) Federation of Saudi Chambers Saudi Export Development Authority Embassies: U.S. Embassy in Saudi Arabia (Facebook, Twitter) British Embassy Riyadh (Facebook, Twitter) Saudi Embassy in Washington Business intelligence and insights: Saudi Arabia’s General Authority for Statistics King Abdullah Petroleum Studies and Research Center (KAPSARC) (data and tools here, research publications here) USSBC briefs and reports Saudi Export Development Authority export reports Saudi Central Bank (SAMA) economic reports and statistics Economist Intelligence Unit (EIU): Saudi Arabia S&P: Saudi Arabia Moody’s: Saudi Arabia Oxford Business Group: Saudi Arabia The World Bank: Saudi Arabia IMF: Saudi Arabia AGSIW Economic Barometer Travel: U.S. State Department: COVID, alerts and messages, travel info, travel advisory, security report UK travel advice for Saudi Arabia Saudia Airlines guidance Community: Diplomatic Quarter Magazine Internations (U.S. Expat Networking): Riyadh, Jeddah, Eastern Province |
Saudi Updates | Johnson & Pump Law
Commercial Law in Saudi ArabiaChris Johnson
bronzeChris is a bronze memberManaging Attorney, Johnson & Pump