New Investment Law to treat Saudi and foreign investors equally
The Ministry of Investment is drafting a new Investment Law under which the local and foreign investors will be treated equally. The ministry is currently completing studies with regard to various provisions of the draft law, which will come into force after the necessary approval from the higher authorities in the near future, Okaz/Saudi Gazette has learnt from well-informed sources.
The ministry is working to facilitate the procedures for attracting and protecting direct investments, enhancing investment environment, preserving investor rights, and increasing their confidence in local investments.
According to the provisions of the draft law, the local and foreign investors would be treated equally with regard to their direct investments.
Foreign investors will enjoy neutral treatment without any discrimination, and they will have the freedom to manage, sell and dispose of their economic projects, as well as to own the properties that are necessary to ensure smooth operation of the economic project.
Foreign investors will have the freedom to conclude commercial contracts; acquire, liquidate or sell any company, facilitate procedures and provide facilities with making available of the necessary support and assistance by all competent authorities.
There are provisions in the law to transfer funds from inside and outside the Kingdom, and these include transferring the proceeds and profits of the economic project.
It also includes selling and liquidating it through regular channels using any recognized currency inside the Kingdom or disposing it by any other legitimate means; protection of intellectual property, confidential commercial information and personal data, and approaching the competent courts or arbitration centers in the Kingdom.
There will be provisions in the new law to impose fines amounting to SR500,000 on anyone who violates the law or its executive regulations after giving him a deadline to rectify the violations. If no rectifications were made, the investor’s registration or license will be canceled, as well as revoking all or some of the investment facilities granted to the investor.
The law aims to support the principle of competitive neutrality and fairness and ensuring equal opportunities in the treatment of direct investments made by public and private investors. The local and foreign investors will be subject to the same sectoral approval requirements for licenses and registration, as well as for approvals or permits for certain economic activities or special economic zones.
The draft law forbids the confiscation of direct investments in whole or in part except by a court ruling, and it is not permissible to expropriate them in whole or in part except for the public benefit and in return for a fair compensation.