Saudi Arabia has a solid legal framework and regulations in place to support the country’s governance and commercial environment. Saudi Arabia’s legal system is governed by Islamic law, or Sharia, and includes a variety of rules and regulations aimed at maintaining social peace, assuring ethical behaviour, and supporting economic progress. The legal framework of the country encompasses a wide range of issues, including commercial, labour, investment, and intellectual property laws, and serves as a solid basis for both domestic and foreign enterprises.
Disclaimer: Despite our efforts to provide the most up-to-date regulations, the laws mentioned above may not reflect the latest revisions, as they are subject to frequent changes.
LIST OF KSA CORPORATE LAWS & LEGISLATIONS
BUSINESS & COMPANY LAWS
The KSA Business and Company Laws form a crucial legal framework governing company formation, operation, and dissolution in the country. Serving multiple purposes, these laws are instrumental in fostering a favorable business environment, building investor confidence, and aligning corporate governance with global standards.
KSA COMPANIES LAWS
Saudi Arabia’s growing corporate laws, particularly the New Companies Law and the Anti-Money Laundering Law (AML), encourage transparency and economic progress. The New Companies Law simplifies business formation and operation, while AML law increases financial monitoring to combat money laundering, maintaining the Kingdom’s secure and compliant corporate environment.
The 2022 Companies Law of Saudi Arabia, issued under the Kingdom’s corporate legislation, modernizes the corporate legal framework, attracting foreign investment. Aligned with Vision 2030, it enhances flexibility, protects business interests, strengthens the private sector, and adheres to international standards, replacing the 2015 law.
Implementing Regulations Of The Companies Law
The Regulations detail filing procedures for financial statements, auditor’s and directors’ reports, and auditor appointment criteria, including terms and exemptions for small and micro enterprises, ensuring comprehensive compliance in corporate governance.
The Law of Trade Names regulates the registration, usage, and safeguarding of trade names, ensuring equitable competition and legal acknowledgment for businesses operating under designated names within the commercial realm.
Executive Regulations of
Trade Names Law
The Executive Regulations of Trade Names provide detailed guidelines and procedures for the implementation of the Trade Names Law, outlining specific requirements and processes related to registration, usage, and protection of trade names.
The Law of Commercial Agencies governs the establishment, operation, and termination of commercial agency relationships, ensuring legal protection and fair practices for both principals and agents involved in business representation agreements.
The Implementing Regulations of The Law of Commercial Agencies
The Implementing Regulations of The Law of Commercial Agencies provide detailed procedures and guidelines for the application and enforcement of the law, ensuring adherence to its provisions and fair treatment within commercial agency relationships.
The Commercial Papers Law governs the issuance, negotiation, and enforcement of commercial papers such as promissory notes and bills of exchange, ensuring legal standards and protections in financial transactions and trade.
The Bankruptcy Law governs the legal processes and procedures for handling insolvency cases, including debt restructuring, liquidation, and reorganization, aiming to provide a fair and orderly resolution for financially distressed entities.
Implementing Regulations of The Bankruptcy Law
The Implementing Regulations of the Bankruptcy Law outline detailed procedures and guidelines for the application and enforcement of bankruptcy procedures, ensuring adherence to the law’s provisions and fair treatment of stakeholders involved in insolvency cases.
The Franchise Law oversees the formation, operation, and cessation of franchise agreements, safeguarding legal standards and protections for both franchisors and franchisees engaged in collaborative business ventures.
Implementing Regulations of The Franchise Law
The Implementing Regulations of the Franchise Law outline procedures and guidelines for enforcing franchise agreements, ensuring compliance with legal standards, and providing clarity for franchisors and franchisees in business relationships.
The Law of Commercial Register
The Law of Commercial Register governs the registration, maintenance, and accessibility of commercial records, ensuring transparency and legal compliance for businesses operating within the commercial sector’s regulatory framework.
The Implementing Regulations of The Commercial Register Law
The Implementing Regulations of the Commercial Register Law provide detailed procedures and guidelines for the application and enforcement of registration requirements, ensuring compliance with legal standards and facilitating transparency in commercial record-keeping practices.
The Chambers of Commerce Law governs the establishment, functions, and regulations of chambers of commerce, supporting trade, facilitating business growth, and ensuring compliance with commercial standards, practices, and regulatory requirements.
The Implementing Regulations of
The Chambers of Commerce Law
The Implementing Regulations of the Chambers of Commerce Law provide comprehensive guidelines for enforcing chamber operations, ensuring compliance with legal standards, and facilitating effective functioning within the commercial sector’s regulatory framework.
The Law of Commercial Data regulates the collection, storage, and utilization of commercial information, ensuring data privacy, security, and compliance with regulations in commercial transactions and operations.
The Implementing Regulations of the Commercial Data Law
The Implementing Regulations of the Commercial Data Law provide comprehensive guidelines for enforcing data management practices, ensuring adherence to legal standards, and promoting data privacy and security within commercial operations and transactions.
The Law on The Authorities of The Ministry of Commerce
The law on the Authorities of the Ministry of Commerce” outlines the powers, functions, and responsibilities delegated to the Ministry, ensuring effective governance, regulation, and promotion of commerce within its jurisdictional scope.
The Precious & Gemstones Law in Saudi Arabia institutes regulations overseeing the trade, import, export, and ownership of precious stones and gems within the Kingdom. Its objective is to guarantee transparency, authenticity, and ethical conduct within the precious stones industry, protecting the interests of consumers and businesses alike.
The Commercial Books Law in Saudi Arabia establishes fundamental principles for record-keeping, auditing, and financial reporting for businesses and commercial entities operating within the Kingdom. Its main goal is to promote transparency, accountability, and precision in financial transactions, thereby cultivating a dependable and credible business environment.
In Saudi Arabia, the Law of Trademarks governs the registration, protection, and enforcement of trademarks. It establishes a legal framework enabling individuals and businesses to register their trademarks and delineates the rights and obligations of trademark holders.
The law covers all e-commerce businesses selling goods or services in Saudi Arabia, regardless of their location. Businesses must, at least, display the service provider’s name or any distinctive identification on their website.
Moveable Property Security Law
The Moveable Property Security Law oversees the establishment and enforcement of security interests in movable assets, offering a legal structure to streamline lending transactions and safeguard creditors’ interests.
The Tourism Law in Saudi Arabia oversees the country’s tourism sector, with the objective of fostering the development of tourism infrastructure, enriching visitor experiences, and fostering sustainable sectoral expansion.
Tourist visa regulations in Saudi Arabia outline the steps and requirements for individuals seeking to visit the country for tourism. They aim to facilitate tourism while ensuring security and compliance with the law.
The Income Tax Law in Saudi Arabia governs the taxation of income earned by individuals and entities within the country. It outlines rules for determining taxable income, applicable tax rates, deductions, exemptions, and filing requirements. The law aims to ensure a fair and equitable taxation system while supporting government revenue and public services.
The Public Warehousing Law regulates the establishment, operation, and management of public warehouses, ensuring compliance with standards, safety measures, and fair practices in storing goods and commodities for commercial purposes.
The Law of Arbitration governs the resolution of disputes outside of court through arbitration, establishing procedures, standards, and enforcement mechanisms to ensure fair and efficient resolution of conflicts between parties.
The objective of copyright law is to protect the original works of authors, creators, and artists, granting them exclusive rights to reproduce, distribute, and monetize their creations while preventing unauthorized use by others.
Corporate Governance Regulation
The Corporate Governance Regulation establishes guidelines and principles for the management and oversight of corporations, promoting transparency, accountability, and ethical behaviour among corporate entities to protect shareholder interests and ensure sustainable business practices.
Telecommunication & Information Technology Act
The Telecommunication and Information Technology Act covers key aspects such as licensing requirements for telecom operators, regulatory oversight, consumer protection measures, and guidelines for data privacy and cybersecurity. It details the roles and responsibilities of service providers and the regulatory authority.
The Mining Investment Law in Saudi Arabia aims to attract foreign investment and promote the mining sector as part of the country’s Vision 2030 initiative. It provides a framework for granting exploration and mining licenses, setting out the rights and obligations of investors, and establishing regulations for environmental protection and sustainable development.
Capital Market Institutions Regulations
The Capital Market Institutions Regulations govern the operation and oversight of institutions within the capital market, ensuring compliance with regulatory standards, transparency, and investor protection to foster stability and trust in financial markets.
The Notarization Law of Saudi Arabia regulates the procedures and responsibilities involved in notarizing legal documents within the Kingdom. This law outlines the roles and qualifications of notaries, specifies the types of documents that require notarization, and details the processes for verifying and certifying these documents. It aims to ensure the authenticity and legal validity of documents, facilitating secure and reliable transactions and agreements.
The Law of Commercial Courts in Saudi Arabia establishes a specialized judicial system for handling commercial disputes. It outlines the procedures for the establishment, jurisdiction, and operations of commercial courts. This law is designed to streamline the resolution of commercial cases, provide expertise in handling complex business issues, and enhance the efficiency and predictability of the judicial process in commercial matters.
Law of Municipal Licensing Procedures
The Law of Municipal Licensing Procedures in Saudi Arabia regulates the process for obtaining licenses for various municipal activities and businesses. It sets forth the requirements and steps for applying for and issuing municipal licenses, including those related to construction, business operations, and other activities requiring local government approval. The law aims to ensure transparency, consistency, and efficiency in the licensing process, thereby facilitating lawful and orderly development within municipalities.
The Foreign Investment Law of Saudi Arabia outlines a comprehensive framework for managing foreign investments, aiming to attract international capital while ensuring fair treatment and legal protection for investors. The law defines capital and investment, establishes investor rights, and sets procedures for managing and regulating foreign investments. It includes provisions for fair treatment, protection against expropriation, repatriation of funds, and investment incentives.
The Import Licensing Procedures in Saudi Arabia regulate the import of goods to ensure compliance with national standards and international trade practices. These procedures are essential for maintaining the integrity and quality of goods entering the Kingdom.
The Investment Funds Regulations in Saudi Arabia establish the framework for the creation, management, and operation of investment funds. These regulations aim to protect investors, ensure transparency, and promote the growth of the investment funds market in the Kingdom.
KSA FINANCIAL CRIMES LAWS
Anti-Money Laundering Law (AML)
The Saudi Central Bank, formerly SAMA, oversees financial services in Saudi Arabia. It prioritizes Anti-Money Laundering (AML) compliance within corporate laws. Saudi Arabia has strong AML programs, aligning with Islamic principles, internal rules, and international standards, reinforced by existing AML legislation.
The Saudi Central Bank, formerly SAMA, oversees financial services in Saudi Arabia. It prioritizes Anti-Money Laundering (AML) compliance within corporate laws. Saudi Arabia has strong AML programs, aligning with Islamic principles, internal rules, and international standards, reinforced by existing AML legislation.
TAXATION AND FISCAL LAWS
Taxation and fiscal laws in Saudi Arabia are comprehensive, covering income tax for foreign companies, value-added tax (VAT), corporate tax, customs duties, and excise tax. These regulations are designed to govern economic activities effectively while promoting financial stability within the country’s framework. Saudi Arabian resident companies, including foreign companies with a permanent establishment, are subject to corporate income tax on their profits. Customs duties are imposed on the import and export of goods. The rates vary depending on the type of goods and their origin.
KSA BUSINESS TAX LAWS
Saudi Arabia’s tax laws as mentioned below include the tax laws to consider when planning to set up a company in Saudi Arabia, such as the Excise Goods Tax Law, the Value Added Tax (VAT) Law, the VAT Implementing Regulation, and Transfer Pricing. These laws contribute to the country’s fiscal structure by levying taxes on certain products and services and instituting VAT, hence increasing revenue collection, and staying consistent with international standards.
Excise Goods Tax Law
Royal Decree No. (M/86) of 27/8/1438 AH established Saudi Arabia’s Excise Tax Law, effective 11 June 2017 under the Gulf Cooperation Council States’ Common Excise Tax Agreement. It imposes an indirect tax on specified items, collected from producers, importers, or intermediaries, often included in future sales prices.
Transfer Pricing Law
Transfer pricing, governed by Saudi Arabia’s Corporate Laws, refers to pricing in transactions among related parties or those under shared control, applying the Arm’s Length Principle. It ensures fairness in pricing as if dealings were between independent entities.
Zakat Collection Law
Zakat Tax, mandated by Islam, is compulsory in Saudi Arabia under its Corporate Laws. Managed by the Zakat, Tax and Customs Authority (ZATCA), it’s collected annually at a rate of 2.5% from individuals and businesses for economic development.
KSA VALUE ADDED TAX LAWS
Value Added Tax (VAT) Law
In Saudi Arabia, Value Added Tax (VAT) is an indirect tax applied to specified goods and services, regulated by corporate laws. It follows the Unified VAT Agreement, collecting tax across the supply chain and requiring registration for all economic activities.
VAT Implementing Regulation Law
Value Added Tax (VAT) in Saudi Arabia is levied on goods and services at each stage of the supply chain, from raw material purchase to consumer sale. Governed by corporate laws, it operates under the VAT Implementing Regulations.
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