The issuance of the Investment Law by Royal Decree No. (M/19) and the entry into force of its Implementing Regulations is the biggest legislative shift in the history of Saudi Arabia’s business and investment environment. The Law formally repealed the Foreign Investment Law issued by Royal Decree No. (M/1) of 1421H and created a single legal framework that treats local and foreign investors equally.
1. Key guarantees and rights for investors under the Law
- Full equality and non-discrimination (Article 3 of the Law and Article 3 of the Regulations): Foreign investors receive the same treatment as national investors in owning assets, doing business and accessing investment incentives in similar circumstances.
- Protection against indirect expropriation (Article 5 of the Implementing Regulations): An explicit ban on any administrative measures or decisions that strip investors of their core rights in their project or destroy its economic value without formal expropriation, with fair and prompt compensation guaranteed where public interest applies.
- Free transfer of funds and profits without delay (Article 6 of the Regulations): The investor’s full right to transfer capital, profits, liquidation proceeds, proceeds from the sale of shares and employees’ wages out of the Kingdom in any recognised currency, without banking restrictions or delay.
- Right to arbitration and dispute resolution (Article 10 of the Law): Parties may agree to settle disputes through alternative means such as arbitration, conciliation and mediation, or refer them to the competent commercial courts.
2. Mandatory statutory deadlines in the Implementing Regulations
- Registration notice: The Ministry of Investment issues the investment registration notice within 10 working days of the application being complete.
- Time to complete documents: Investors are given no less than 15 working days to submit any missing items.
- Annual update of declarations: Investors submit their annual update through the portal within the 60 working days before the annual date, and the Ministry responds within 5 working days.
- Time to correct non-serious violations: The Ministry gives the establishment no less than 30 working days to remove the violation before any penalty is imposed.
- Violations Committee (Article 11 of the Law): Penalties start with a warning, then a fine of up to SAR 300,000 (doubled for repeat violations), and can reach cancellation of registration for serious violations (such as investing without registration).
- Right of judicial appeal (Article 12 of the Law): Investors may appeal to the competent court within 30 days of being notified of the penalty decision.
To apply directly, submit your registration through the Invest Saudi platform, or visit the Ministry of Investment e-services page and the Ministry’s FAQ, and read the official text of the Implementing Regulations of the Investment Law on the Ministry of Investment website.