Saudi Arabia’s anti-concealment initiatives

Saudi Arabia’s anti-concealment initiatives

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In light of the Saudi Ministry of Commerce’s keenness to combat concealment and regulate all commercial arrangements in the Saudi market, it is important to shed light on the previous campaign and grace period provided to violators.

The ministry issued a regulation for correcting violators of the provisions of the commercial concealment law, which included options to correct the situation after submitting a request to the ministry.

The first option is to introduce a new partner in the facility between a Saudi and a non-Saudi, after ensuring that the legal requirements that enable a non-Saudi to enter into a partnership in the facility are met.

The second option is to register the ownership of the facility in the name of a non-Saudi. This can be done by an agreement between the Saudi and the non-Saudi to transfer the facility’s ownership to the non-Saudi after the latter fulfills the legal requirements that enable him or her to own this facility.

The third option is for the Saudi to continue to engage in economic activity by introducing a new partner, who could be a Saudi or a licensed foreign investor, in the facility after fulfilling the legal requirements, and registering that with the Ministry of Commerce.

The options also included a Saudi violator can sell or waive a facility in accordance with the procedures followed for each case.

Another option is for the non-Saudi to obtain the premium residency according to what is stated in the premium residency system and to complete the correction of his status by taking advantage of the premium residency benefits.

A final option in the corrective period lets a non-Saudi leave the Kingdom permanently through a final exit visa after submitting a pledge to abandon previous business rights, and announcing this through the means specified by the Ministry within a period not exceeding 30 days.

After that, the ministry reviews the status correction request submitted to ensure that it meets the requirements and informs the corrective applicant to complete the procedures for this correction within a period of (ninety) days starting from the date of his or her notification.

In the event that the correction status is not completed during this period, the ministry can extend this period based on the reasons it assesses.

IIf the correction status is not completed during this period, the correction requester must complete the correction procedures with one of the other options referred to in the regulation within a maximum period of (one hundred and eighty) days from the date of expiry of the basic period.

The system also included final provisions that clarified important points. For example, a person who applied for the correction of his situation in accordance with this regulation enjoys all the rights prescribed for him by the relevant regulations, including the right of residence and movement.

To ensure proper implementation, the ministry, in coordination with the concerned authorities, sets the necessary procedures for implementing this regulation, including the forms necessary to apply the options contained therein.

Dimah Talal Alsharif is a Saudi lawyer and legal consultant. Twitter: @dimah_alsharif

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