The cover-up business is an illegal way for non-Saudis to escape paying permit fees and taking advantage of the benefits Saudis receive for investment from the government.
Under this type of business, a Saudi citizen allows workers under his sponsorship to run the businesses themselves in return for a fixed monthly or annual fee.
This flourishing practice has enabled foreigners to earn at least SR200 million a month, according to the latest figures released by the Ministry of Commerce and Industry.
The ministry report also projected a substantial increase in the amount of money that foreigners will remit to their countries in the near future. This is mainly attributed to the overdependence on foreign workers to implement several mega infrastructure projects in various regions of the Kingdom, Al-Riyadh newspaper reported.
The report showed that the growing trend of cover-up businesses would contribute substantially in increasing the amount of money that the foreigners send in remittances.
At present, there are over 8 million foreigners in the Kingdom, of which about 6 million are employed by the private sector. They transfer about SR100 billion every year to their countries, the report pointed out.
Despite the government’s relentless efforts to combat cover-up businesses, they are still flourishing in the Kingdom. Critics point to serious flaws in existing laws to combat these types of businesses in addition to the lack of cooperation from citizens as well as poor monitoring mechanisms.
According to the ministry report, the number of cover-up business cases referred to the ministry and its various branches and offices across the Kingdom reached 381 in the second quarter of the year, an increase of 115 percent against cases reported in the previous quarter.
Of these, 122 have been referred to the Public Prosecution and Investigation Commission.
The ministry’s Jeddah branch handled the most cases, 80 in total (21 percent), and it was followed by the Eastern Province branch with 59 (15.4 percent) and the Makkah branch with 54 (14.1 percent).
The report also revealed that Yemeni nationals come first in the list of foreigners running cover-up businesses, accounting for 37.3 percent of those engaged in the practice.
Syrians come second at 11.4 percent and they were followed by Indians (9.6 percent), while Lebanese were bottom at 1.3 percent.
Other foreigners engaged in such types of businesses make up 8.2 percent, and they include those from Sudan, Turkey, Afghanistan, Chad, Morocco, Indonesia and China.
The ministry report also pointed out that nearly half (47.2 percent) of cover-up businesses are engaged in the construction and contracting sector, followed by various consumer goods (42.4 percent). The remaining 10.6 percent consists of other sectors such as law, administration and engineering consultancy services.
