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KSA: Updated Investment Law
Saudi Arabia is advancing its commitment to a more open and competitive investment landscape with the introduction of an updated investment law, designed to enhance transparency and foster confidence among domestic and international investors. The law simplifies the registration process for foreign investors and re-evaluates restrictions on economic activities to align treatment of all investors more closely. This new legislation, approved by the Council of Ministers, represents a significant step in aligning Saudi Arabia’s investment environment with global best practices. The updated investment law shall enter into force one hundred and eighty days following the date of its publication in the Official Gazette – February 2025 – and shall repeal the Foreign Investment Law issued by Royal Decree No. (M/1) dated 5/1/1421 AH as well as any provisions conflicting therewith.
The key aim of the updated investment law is to promote equal treatment between domestic and foreign investors under similar circumstances, ensuring that both are afforded the same opportunities and protection. The exact meaning of “equal treatment between domestic and foreign investors” is not directly clear from the updated investment law. However, the law grants Investment Minister the right to issue regulations that clarify the investment law further. The Investment Minister shall issue the Regulations within one hundred and eighty days from the date of publication of the updated investment Law, so in February 2025. Whether the high capital requirements for applying for a trading license for foreign investors will be lifted remains to be seen with great anticipation.
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