As part of its “Vision 2030” economic diversification agenda, Saudi Arabia has proposed a major revision to its investment legislation to attract more foreign investment.
To increase transparency and facilitate corporate operations, the updated Act unifies the many investor rights and freedoms into a single, cohesive framework. In addition to providing strong protections for intellectual property and enabling seamless financial transfers, the amended law offers improved investor protections, such as respect for the law, equitable treatment, and property rights.
It expedites government transactions and investment procedures by streamlining the registration process and introducing new service centres to replace complicated licensing requirements with a simplified approach.
The implementation of the Private Sector Participation Law, the Companies Law, the Bankruptcy Law, the Civil Transactions Law, and the establishment of Special Economic Zones are among the pro-investment policies that the update comes after.
Saudi Investment Minister Khalid Al-Falih, said, “The law reinforces Saudi Arabia’s commitment to providing a hospitable and secure environment for investors, boosting economic growth, and enhancing the Kingdom’s status as a major global investment destination.”
“The Vision 2030 policy direction allows investors to invest with certainty and to expand with confidence at a time when many other markets are facing tremendous volatility,” the speaker continued.
Additionally, by encouraging fair competition and guaranteeing equitable treatment for both domestic and foreign investors, the law seeks to create a competitive market environment.
Through the Saudi Arbitration Centre and other connected organisations, it offers access to sophisticated dispute resolution procedures. The effects of Saudi Arabia’s pro-investment policies are already evident: FDI inflows increased by 158% from USD 7.46 billion in 2017 to USD 19.3 billion in 2023, while gross fixed capital formation increased by 74% to nearly USD 300 billion in 2023.
According to Al-Falih, “The amended investment law builds on an extensive diversification strategy that includes investment-specific measures including the development of special economic zones as well as better quality of life offerings.”
The World Trade Organisation, the Gulf Cooperation Council, and other international investment agreements set forth the requirements for the new laws, which the Ministry of Investment created and plans to put into effect in 2025.
Saudi Finance Minister Mohammed Al-Jadaan commented on the development on X, writing that the updated law is an important “update to the investment regulatory framework that leads to growth prospects for private sector investment and a more competitive economy under the Saudi Vision 2030.”