Publications – Page 11 – Hammad & Al-Mehdar Law Firm

Emerging Trends of Saudi Arabia’s Sporting Industry

Posted on October 12, 2022 - 12:20 pm by perpetual-admin

Entertainment and sporting events have not always been the first things that come to mind in relation to Saudi Arabia. However, in recent years the country has made great strides in developing its entertainment industry, with a particular focus on sports. This has been driven by several factors, including the country’s large and young population, and the government’s desire to build a more diverse and modern economy.

While the sporting industry in Saudi Arabia is still in its early stages of development, it is currently growing at a rapid pace. This is evident in the increasing number of sports facilities and events being held in the country and the growing number of Saudis participating in sports. In addition, the Saudi government has been investing heavily in the sporting industry, both in terms of infrastructure and supporting local athletes.

Key Developments in Saudi Arabia’s Sporting Sector

The Saudi government has taken a keen interest in the role of sports and sporting events in the country’s development. In line with its Vision 2030 reform agenda, the government has set out to increase participation in sports and improve the quality of sporting facilities and events within the Kingdom. This has led to many developments within Saudi Arabia’s sporting sector, including the ones outlined below.

Increase in Major Sporting Events

One of the most notable developments in Saudi Arabia’s sporting industry has been the increase in major sporting events being held in the country. Over the past five years, the country has hosted several high-profile sporting events, including the Saudi Arabian Grand Prix in 2021, the Joshua v Ruiz II – “Clash on the Dunes” in 2018 and the Saudi Cup international horse racing event in 2020. Saudi Arabia has now put forward its bid to host the FIFA World Cup in 2030.

The Introduction of ESports

Esports — competitive electronic gaming — is not recognised by many countries as a sport. This means it can be difficult for professional gamers to find an appropriate venue to compete at an international level. However, in recent years, Saudi Arabia has begun to nurture its own esports scene, which has included the establishment of the Saudi Esports Federation in 2017. In the summer of this year, the federation launched the Gamer8 Festival, which was a highly successful 8-week esports event held across Riyadh.

The Growth of Women’s Sport

The Saudi government has taken a keen interest in increasing women’s participation in sports over the last decade. In 2012, the nation sent its first female athletes to the Olympic games and from 2017 onwards, women have been allowed to compete in sports tournaments held in the country. 2020 saw the launch of the Saudi Women’s Premier League, ushering in a new era for women’s football in the Kingdom.

The Rise of Sports Tourism

The Saudi government is also looking to develop the country’s sports tourism industry. In 2018, the Kingdom hosted the first season of the World Boxing Super Series at King Abdullah Sports City in Jeddah, which attracted boxing fans from all over the world. The country is also set to host the Spanish Super Cup semi-final in 2023 and the Formula E Diriyah E-Prix early next year. These types of events are not only a boost for the sporting industry, but also for the country’s economy as a whole.

Savvy Games Group Strategy

In September 2022, Saudi Crown Prince Mohammed bin Salman announced the government’s goal of becoming a global hub of games and esports, with the launch of the Savvy Games Group Strategy. This ambitious plan includes a focus on developing the local games industry, as well as supporting Saudi Arabian gamers to compete at an international level. As part of the plan, the government will establish 250 games companies in the country by 2030, creating over 39,000 jobs. In total, government investment in this strategy is expected to reach SAR 142 billion by 2030.

Next World Event

The Saudi Esports Federation just hosted the inaugural Next World Forum in September 2022. It was a two-day event that saw a number of prominent Esports industry speakers gather to discuss the future of the sector. Among them were Grant Johnson, the chairman and CEO of Canada’s Esports Entertainment Group and Chester King, the vice president of the Global Esports Federation. The forum was a huge success, with over 1,000 people in attendance from across the globe.

What Does the Future Hold?

The sporting industry in Saudi Arabia is still in its early stages of development. However, the sector is growing at a rapid pace and the government is fully supportive of its growth. This is evident in the many developments that have taken place in recent years, including the increase in major sporting events, the arrival of esports and the active promotion of women as both sports spectators and competitors.

In addition to this, the Saudi government is keen to develop the country’s sports tourism industry as part of its move to diversify the nation’s economic activity. With the government’s continued support, it is likely that the sector will continue to grow in popularity and size, welcoming a new era of sports in Saudi Arabia.

Changes to Saudi’s legal Framework Since COVID-19

Posted on October 19, 2022 - 9:06 am by perpetual-admin

Saudi’s legal system is based on the principles of Sharia law and has remained largely unchanged for decades. However, in recent years the government has modernised the system by introducing online court services and other technological advances. There have also been a series of legal reforms seeking to bring the commercial courts closer to international best practice.

The COVID-19 pandemic has resulted in a further acceleration of these changes, with the Saudi government taking steps to digitise the court system and make it more accessible to the public. In this article, we will explore the changes that have taken place, why they were introduced and how they are helping to modernise the Saudi legal system.

Recent Reforms to the Legal System

COVID-19 has acted as a catalyst for change in many areas of life, and one of those is the legal system. However, even prior to the pandemic, the Saudi government was already taking steps to modernise the system and facilitate a more attractive commercial environment for international investors. Here are some of the key reforms that have been introduced in recent years.

Licencing for Foreign Law Firms

In 2022, the Saudi government issued a formal licensing regime for foreign law firms to operate in the Kingdom. This is a significant development, as it officially opens up the Saudi legal market to international firms for the first time. It is also a reflection of the government’s commitment to attracting foreign investment and talent and providing a level playing field for all businesses operating in the Kingdom.

In order to apply for a licence, foreign law firms must have two partners that reside within the Kingdom, no more than 30% of their fee revenue must originate from out KSA, and no work related to Saudi law may be passed on to an external office.

Increase in Female Legal Professors

There has been a significant increase in the number of female legal professors in Saudi Arabia in recent years. This is part of a broader government initiative to encourage women to participate more fully in the workforce and give them equal opportunities to succeed.

Over a decade ago, there were no licensed Saudi female lawyers, and in 2022, there are now over 1,000. Although female lawyers may still be a minority, this figure is expected to grow steadily as more women choose law as a career.

Electronic Legal Services

One of the most significant changes has been the introduction of an online court system, which has modernised the way in which cases are heard and processed. This has resulted in a more efficient and effective system, with faster turnaround times for cases.

It is now possible to file legal documents electronically, submit evidence online, and even attend court hearings via video link. This has made the system more accessible for litigants, as they no longer need to physically attend court in all cases.

Laws for the 21st Century

With the nation’s digital transformation in full swing, it’s become necessary to introduce laws that govern new technologies and business models. In recent years, the Saudi government has enacted a number of laws relating to e-commerce, data protection, and cybercrime.

These laws are designed to encourage innovation and investment, while also ensuring that consumers and businesses are protected from harm. Influencers have also been regulated, with a new law introduced this year that requires anyone generating an income through social media to apply for a licence.

Looking to the Future

The Saudi legal system is continuing to evolve, and the pace of change is likely to accelerate in the coming years. This is positive news for businesses operating in the Kingdom, as it creates a more predictable and transparent regulatory environment.

It is also encouraging to see the government taking steps to increase female participation in the legal profession, as this can only lead to a more balanced and effective system in the long-term. With the right reforms in place, the Saudi legal landscape is well-positioned to meet the challenges of the 21st century.

International Legal Cases in Saudi Arabia

Posted on November 6, 2022 - 6:49 am by perpetual-admin

The Saudi Arabian government has taken significant steps towards modernizing and codifying the legal system over recent years. The judicial system is governed by a combination of Islamic Sharia principles and international legal frameworks that have been adopted into Saudi law. As the government continues to promote the Kingdom as an investment destination, it has introduced new regulations and legal mechanisms to ensure that international business deals are protected under its legal system.

For international clients operating in Saudi Arabia, it is important to understand the key legal requirements that must be met when managing a legal case in the country. This includes working with local law firms or international legal teams to ensure that all necessary processes and regulations are followed.

Can You Start a Legal Case in Saudi Arabia as an Overseas Client?

The short answer is yes, you can start a legal case in Saudi Arabia as an overseas client. However, it is important to note that there are certain requirements that must be met in order to do so.

Firstly, the legal issue itself must fall under Saudi jurisdiction. This means that the case must be related to a business transaction, agreement or crime that took place in Saudi Arabia. Additionally, the target of the legal action must be residing in Saudi Arabia. If these conditions apply, then you are eligible to file a legal case in the Kingdom.

The Process of Filing a Legal Case in Saudi Arabia

Filing a legal case in Saudi Arabia is similar to the process in other countries. There are a few key steps that must be followed as outlined below.

1. Consulting with a local law firm

This is an essential first step, as the legal process will be governed by Saudi law and regulations. Typically, each firm will have a specialty area, whether it is commercial law, family law, or criminal law. You may also need to engage the services of an interpreter if your preferred lawyer does not speak English.

2. Preparing your power of attorney

Once you have chosen a law firm to represent you, they will require you to submit a variety of documents as part of the legal process. It is essential that you provide a power of attorney, which must be notarized in your home country and attested by the Saudi Arabian embassy if you are overseas.

3. Gathering all necessary documentation and evidence to support your case

This includes notarized contracts, agreements, or other documentation related to your legal issue. Your legal representative will be able to advise you on what type of documentation is required to support your case.

4. Filing a legal complaint with the relevant court in Saudi Arabia

Once your legal representative has prepared the necessary paperwork, your representative can submit it to the relevant court in Saudi Arabia. Since the pandemic, the court system now permits cases to be heard remotely, via video conferencing. This is particularly beneficial for overseas clients, who may be unable or unwilling to travel to Saudi Arabia for a court hearing. In some cases, your lawyer will meet with the judge on your behalf to argue your case and you will not be required to attend the court.

How Quickly Will My Legal Case in Saudi Arabia Progress?

Thanks to positive reforms, the Saudi legal system moves relatively quickly, with cases often being resolved within a few months. Of course, this will depend on the complexity of your legal issue and whether it requires additional evidence or resources.

If you are taking a case during the holy month of Ramadan, then you should expect that the process may be slower than usual. During the two annual Eid festivals, the court will also close for a period. However, in general, you can expect to see your case move through the legal process relatively quickly and efficiently.

Overseas clients are treated fairly in the Saudi legal system and have the same rights as local clients. As long as you engage with your legal representative and follow the expected process, you should be able to manage your international legal case effectively in Saudi Arabia.

Changes to Saudi Arabia’s Dispute Resolution Regulations

Posted on November 9, 2022 - 10:41 am by perpetual-admin

Dispute resolution is a growing industry in Saudi Arabia, and over the past 18 months, there have been some changes to its regulations. These changes aim to maintain high levels of efficiency and bring the system in line with international best practices.

Another significant change concerns the power of KSA’s enforcement courts. In this article, we will outline what these courts are, and what they can do to help ensure the efficient resolution of disputes.

Updates to the Dispute Resolution Framework

Dispute resolution was not a particularly well-developed area of law in Saudi Arabia until recently. In 2012, the government passed the Saudi Arbitration Law, which introduced a new framework for resolving disputes in the Kingdom. The introduction of this law was in response to growing levels of international arbitration, and it is part of a wider plan by the government to improve its legal infrastructure. Since then, a number of changes have been made to this framework to keep pace with international best practices, including the ones outlined below.

Electronic submissions

The introduction of an online dispute resolution system allows businesses to submit and manage disputes electronically. Since the COVID-19 global pandemic, this has become increasingly popular as it allows disputes to be dealt with remotely at a much faster pace than traditional face-to-face proceedings.

New Fee Structure

A new fee structure is one of the most recent changes to Saudi Arabia’s dispute resolution framework. Under this structure, parties who lose in court will be required to pay a fee of 2-5% of the claim value. This is intended to discourage frivolous claims and ensure that disputes are not being pursued to simply pressure the other party.

Saudi Arabia’s Enforcement Court

Saudi Arabia’s enforcement court has considerable power and is responsible for dealing with a wide range of disputes. These include:

Enforcement of court judgments from other countries that apply to people or entities resident in Saudi Arabia.
Enforcement of arbitration awards issued in accordance with the new arbitration law.
Enforcing family law judgments concerning the division of assets and child custody.
Ensuring that financial obligations (such as debts or alimony) are met following a divorce.
Enforcing intellectual property rights, such as trademarks, patents, and designs.

The role of the enforcement court is to ensure that these disputes are resolved in a fair and timely manner, which benefits businesses and individuals alike. With its extensive power, it is an important facet of the Saudi legal system.

In the case of arbitration and dispute resolution, the enforcement court has the power to enforce arbitration awards issued under the new arbitration law. This means that, should one party fail to comply with the award, the other party can seek enforcement of it in court. This gives businesses a level of security and ensures that any awards are respected.

Overall, the changes to Saudi Arabia’s dispute resolution framework have introduced higher levels of efficiency and international best practice to the legal system. This has benefited businesses and individuals alike, making Saudi Arabia a more attractive region for investment and entrepreneurship.

The Liability of Management and Good Governance in a Saudi Arabian Context

Posted on December 14, 2022 - 2:33 pm by perpetual-admin

Across the globe, businesses are under increasing pressure to adopt sustainable and ethical practices. Known as ESG (Environmental, Social, and Governance), this focus on responsible business practices is becoming more and more important for companies looking to protect their reputation and ensure long-term success.

In Saudi Arabia, where businesses are just starting to come to terms with the need for ESG compliance, there is still some work to be done to create a corporate culture that embraces these values. In this article, we will explore the importance of effective management and good governance in a Saudi Arabian context, looking at what this means in practice and the benefits that will be gained by businesses that fully embrace it.

What Is Governance?

At its most basic level, governance refers to the systems and processes that are put in place by an organization to ensure that operations run smoothly and effectively. Often used interchangeably with management, governance is a broader concept than simply managing day-to-day operations; it encompasses a range of different factors such as ethics, risk management, compliance requirements, and stakeholder relationships, among others.

In Saudi Arabia, the importance of governance has become particularly clear in recent years. Hence, the Capital Market Authority (“CMA”) issued the Corporate Governance Regulations by Resolution No. 8-16-2017 dated 12-02-2017 G (The “Regulations”) as it aims to enforce the global governance standards on the joint stock companies.

The Regulations broadly define Governance as a set of rules that aim to regulate the relationship between the management team and the shareholders of the company, by establishing rules and procedures in relation to the mechanisms of decision-making, add clarity and more transparency and credibility in order to protect the rights of shareholders, achieve greater clarity and more transparency on the Saudi Stock Exchange and the business environment in general.

As the local authorities have come to realize the importance of governance and the potential risks and liabilities associated with not following its best practices, the Ministry of Commerce issued the Corporate Governance Regulations for Non-Listed Joint Stock Companies (commonly known as Closed Joint Stock Companies) for guidance. Both regulations aim at establishing an effective legal framework to govern the company, and particularly aim at (i) enhancing the role of the company’s shareholders and facilitating the exercise of their rights; (ii) stating and clarifying the rules and responsibilities of the management team; (ii) enhancing the role of the management team and the internal committees in order to develop their capabilities to enhance the company’s decision-making mechanisms; (iv) achieving transparency and credibility to reach greater clarity and more transparency between the management team, shareholders, related parties, and any person is dealing with the company; (v) providing effective and balanced tools to deal with conflicts of interest; and (vi) enhancing accountability and control mechanisms for the Company’s employees.

Why is Good Governance Essential for Saudi Businesses?

There are many benefits for Saudi business owners who embrace good governance and effective management. For one, this approach helps companies maintain strong reputations, both within the local community and on a global scale. It also ensures compliance with regulatory requirements, which can reduce risk and help to prevent any potential legal liabilities for the management team that may have direct or indirect impacts on the company’s operations.

As the management’s liability differs according to the type of company, the recent Companies Law sets out general and strict governance rules that apply to the management team regardless the type of the company.

As shown hereunder, these rules aim to enhance transparency and credibility between the management team and shareholders:

Declaring Interest: without obtaining shareholders’ approval, none of the management team shall have direct or indirect personal interest in the business activities and contracts executed on behalf of the company.
Declaring Competition: without obtaining shareholders’ approval, none of the management team may participate in any business that would compete with the company or may compete with any business area that the company is practicing.
Exploitation: none of the management team shall exploit the company assets, information or investment opportunities presented to him in his capacity as manager or presented to the company to achieve a direct or an indirect interest for himself.

In addition to the above, robust management practices have been shown to improve employee productivity and foster creativity and innovation in the workplace, while good governance helps companies attract investors and achieve long-term success.

What Does Effective Management Look Like?

While there is no single definition of effective management, we may consider several key factors. These include clear and consistent communication, an emphasis on accountability and transparency, and overall, the ability of an organization and its leaders to effectively plan, organize, and implement strategies that enable it to achieve its objectives. This often involves a focus on metrics such as profitability, productivity, efficiency, and customer satisfaction, as well as values such as integrity, responsibility, and trust.

The following are some key strategies that Saudi businesses can implement to improve their management and governance practices:

Establish a culture of accountability and transparency. This requires creating clear processes for employee evaluation and promotion, as well as allowing employees to provide input on important decisions and policies affecting the organization.
Build systems for measuring performance and monitoring progress. This can involve the use of tools such as dashboards, KPIs, and performance scorecards.
Invest in leadership development programs. This can help managers to grow and develop their skill sets. It may include the provision of training on topics such as project management, HR best practices, and change management.
Commit to ongoing learning and education. Businesses can achieve this by forming partnerships with local educational institutions and professional organizations. This can help to foster a spirit of innovation and continuous improvement in the workplace.

Ultimately, good governance and effective management are essential for building strong businesses in Saudi Arabia. By embracing these principles, companies can ensure that they are meeting the highest standards of ESG compliance and maintaining their reputations as responsible corporate citizens.

The Rise of Employee Stock Options in KSA

Posted on December 14, 2022 - 2:36 pm by perpetual-admin

Employee share option plan (the “ESOP”) have seen an impressive rise in popularity across the globe, with more companies offering them as a form of compensation. In KSA, employee share options have recently become a prime option for employers specially tech companies due to the increased flexibility and potential for financial gain that they provide.

Why ESOP are Growing in Global Popularity

ESOP shares offer number of advantages that make them an attractive tool for companies to reward their employees and motivate them to stay with the company: They also provide certain benefits such as:

Equity – ESOP provides employees with a form of equity, allowing them to benefit from the financial success of the company without having to purchase the actual shares.
Potential Gains – ESOP shares offer employees the potential for long-term financial gain as well as short-term performance. This makes them an attractive option for employees looking to benefit from the future success of their company.
Increased Engagement – ESOP shares can also help to increase employee engagement and loyalty by being a shareholder in the company. By providing employees with a sense of ownership in the company, employers can help to boost morale and create a more motivated workforce.

HOW DOES IT WORKS

Usually, the company’s board of director approves the ESOP and set the rules in the form of a plan on how it will work for employees and in most cases grant the chief executive officer of the company the authority to grant the ESOP shares (within the authorised number of shares) based on performance and for talent acquisition purposes since the chief executive office manage the day-to-day business of the company.

We often see in early-stage companies, the board is the administrator of the plan; however, with the growth of the company usually the administration is outsourced to a service provider mainly to assign the fiduciary risk away from management, as well as freeing up of time which the board can instead redirect towards growing the company.

Why Is KSA Prime for ESOP?

Until recently, it was not common for companies in KSA to offer ESOP as a form of compensation. However, the tide is changing, and more employers are now offering them as an attractive option for their employees. Companies have freedom to tailor their ESOP to fit the needs of both the company and the employees, and to modify it as their needs may change. However, stipulations exist on the rights of both the employee and the company when it comes time to “cash-out”.

ESOP is now positioned as the prime option for employers and employees in KSA due to a number of key factors such as (i) being attractive to institutional investors; (ii) cost effective; (iii)result a high retention and attracts talents.

ESOP in KSA: The Future of Compensation

It is clear that ESOP shares set to be a solid option for employers and employees in KSA, with a stable economy, growing stock market, and low cost, they offer a unique combination of flexibility and potential for financial gains that make them an attractive option for both employers and employees.

As more businesses begin to offer ESOP shares, they may soon become the norm in KSA. By harnessing their potential; however, resident companies in KSA must be mindful of the tax implications of offering ESOP shares to foreign employees operating in the Kingdom as the company may be subject to a 20% tax on income generated by shares owned by non-Saudi shareholders. If you are an employer looking to offer ESOP in KSA, be sure to speak with legal advisors who can help ensuring your compliance with the relevant regulations and maximize the potential of this form of compensation.

The Importance of Effective Family Governance

Posted on December 14, 2022 - 2:38 pm by perpetual-admin

Family governance is essential for family businesses to achieve their goals and maintain success across generations. A well-structured family governance model covers all aspects of the family system, including communication, values and traditions, decision-making, conflict resolution, and succession planning. The one thing all family businesses have in common is the need to maintain trust and unity, as well as a shared vision of success. Establishing effective governance helps ensure that family members have the same understanding of values, goals, and objectives.

In this article, we will discuss the importance of good family governance, what it involves, and why families need to institutionalize their governance model.

Institutionalizing Family Governance: The Need for Change

In today’s competitive, globalized market, family businesses must be prepared to face new challenges and changing conditions. Family businesses are increasingly being challenged by competition, new industries, emerging markets, and international investment. As a result, it is essential that family businesses adopt a progressive governance model that allows for agility and adaptation. Institutionalizing a governance system ensures that the family business is run efficiently and effectively, with clear roles and responsibilities, and long-term goals are met.

Here are a few key reasons why it is important to institutionalize family governance:

To remain competitive. International players are increasingly entering family businesses’ traditional markets, making it more difficult for them to maintain their competitive edge. By institutionalizing the governance model, families can ensure that they remain competitive in today’s fast-moving market and deliver strong, consistent performance.
To comply with global best practices. The world of business is increasingly interconnected. Standards of corporate governance are becoming more stringent, and families must ensure they comply with international rules and regulations if they want to enjoy market access. Instituting a formal governance system ensures that family businesses remain compliant and do not fall foul of international standards.
To meet consumer needs. Customers expect the highest level of service and quality, regardless of a company’s size or structure. Delivering on these needs requires good governance and effective decision-making. By institutionalizing a sound framework, families can ensure that their business is ready to meet the needs of customers.
To meet ESG requirements. Environmental, social, and governance (ESG) considerations are becoming increasingly important in the business world. Expectations around responsible and sustainable business practices are higher than ever before, and family businesses must ensure that their governance model is fit for purpose.

Legal Elements of Good Governance

The legal elements of effective family governance are essential. The law provides a useful framework for families to manage their businesses and protect the family’s wealth. It is important to recognise the legal implications of any business decisions and ensure that family governance documents, such as wills, trusts, and shareholder agreements are up to date. Families must be aware of the relevant legal requirements in their jurisdiction and ensure that they comply with them.

Here are a few key legal elements to consider:

Shareholder agreements. Shareholder agreements are legally binding documents, which set out the rights and obligations of the shareholders in relation to the business. These documents can include information about board structure and responsibilities, transfer of shares, decision-making processes, dividend policy, and much more.
Family constitutions. Family constitutions provide families with a framework for decision-making and help ensure that the family’s interests are represented in the business. These documents should be adapted to the evolving needs of the family and updated regularly.
Wills. Wills are a key part of succession planning and should be reviewed and updated periodically. Doing so ensures that the family’s assets are distributed according to their wishes and that any tax liabilities are minimized.
Trusts. Trusts can be used to protect family assets and provide tax benefits. It is important that families understand the legal implications of setting up a trust and ensure that it is tailored to their needs.

Family Businesses Must Prepare for the Future

Family businesses are the backbone of many economies. Their longevity and resilience make them an attractive option for investors, customers, and employees alike. But to remain competitive and successful in an ever-changing business environment, families must ensure they have the right governance model in place. By instituting a formal framework and keeping on top of the legal elements, they can ensure that their business is ready to meet the challenges of tomorrow. If done well, family governance can be the key to a successful and prosperous future.

The 2022 Saudi Arabia Legal Roundup

Posted on January 12, 2023 - 2:29 pm by perpetual-admin

The Kingdom of Saudi Arabia (KSA) is a vibrant and rapidly changing nation, with new laws and regulations being introduced at an unprecedented pace. In this article, we take a look back at the major legal developments that took place in KSA during 2022 and what to expect in 2023.

From changes to family law to new measures designed to promote economic growth, there have been a number of significant legislative moves made by KSA over the past year. We review these important changes here and consider how they may affect businesses operating in the country going forward.

New Laws Introduced in 2022

As part of the National Transformation Program, KSA implemented several new laws in 2022. Some of the areas of focus included family law, corporate governance and data protection. These changes bring greater clarity and certainty to both businesses and residents in KSA.

Personal Status Law

One of the most significant changes to be implemented in 2022 was the new Personal Status Law. The law addressed several issues related to marriage, divorce, inheritance and child custody. It was designed to protect the stability of Saudi families and provide a clear legal framework for resolving disputes. The law has been widely praised by the legal community for its provision of greater legal clarity for matters related to the family.

Evidence Law

In 2022, KSA also introduced a new Evidence Law, which aimed to streamline the process of collecting, presenting, and assessing evidence in civil and commercial cases. With the imminent enforcement of the Evidence Law, it will supersede all provisions found in both the Law of Civil Procedure and the Law of Commercial Courts regarding evidence law.

The new law brings a breadth of evidence types to the table, ranging from judicial and non-judicial, written in both official or ordinary documents, digital records, testimonies through custom, and habit or oaths taken by witnesses. Additionally, any evidence regulated by Sharia laws can also be entered into consideration.

Companies Law

The new Companies Law streamlined the business registration process and provided greater flexibility to entrepreneurs looking to start their own ventures in KSA. The newest Law, reflecting the Kingdom’s 2030 Vision, introduces far-reaching changes to enable businesses more flexibility while safeguarding their interests. It is also carefully crafted to empower the private sector and adhere to global best practices.

With the New Law in effect, investors are now able to form any of these five types of businesses: Joint Liability Company, Limited Partnership Company, Joint Stock Company, Simple Joint Stock Company, and Limited Liability Company.

Executive Regulations for the Personal Data Protection Law (PDPL)

The Executive Regulations for the Personal Data Protection Law (PDPL) was due to come into force in 2022, although it was first introduced in 2021. The PDPL is designed to increase consumer rights and ensure that organizations are taking appropriate measures to protect personal data.

Under the new regulations, organizations must appoint a privacy officer and implement robust data security measures. They must also ensure that all employees receive data protection and privacy training. Additionally, organizations are required to keep records of their data processing activities and provide clear information about how personal data will be used. However, after consultation with concerned stakeholders, the full enforcement of this legislature is delayed until 2023.

Looking Ahead: 2023

KSA is expected to make further steps towards introducing new legislation in 2023, aimed at strengthening and accelerating the Kingdom’s economic development.

Proposed laws include a new bylaw, which allows tourists to rent short-term accommodation in Saudi, such as through Airbnb and HomeAway. This will open the door to the tourism industry and create increased opportunities for Saudi homeowners to make additional income.

By June 2023, regulations related to the licencing of law firms in the Kingdom are set to change, and legal businesses are encouraged to prepare now. All foreign law firms wishing to operate in Saudi Arabia must now submit an application for a license from the Ministry of Justice and demonstrate that they meet certain prerequisites.

The Executive Regulations for the Personal Data Protection Law (PDPL) will also undergo another review before it comes into full force in March 2023. It is expected that this law will be further enhanced to ensure proper implementation.

Saudi’s efforts to modernize and globalize its legal system will continue, with further laws and regulations being explored in 2023. Looking forward, it is clear that the Kingdom is determined to create a compliant and secure legal environment for all businesses, consumers and investors.

A Focus on Saudi Arabia’s Energy Sector

Posted on January 18, 2023 - 6:34 am by perpetual-admin

Saudi Arabia is a leading producer and exporter of energy, and its economy is still heavily tied to the oil and gas industry. However, the country has seen a dramatic shift over the past few years in its energy policies, with the government emphasizing renewable energy resources and developing major projects to diversify its energy mix.

This shift has created major opportunities for businesses in the country that can participate in these efforts, such as in renewable energy production or storage technology. In this article, we’ll explore some of these opportunities and outline the legal considerations that businesses should keep in mind when pursuing energy-related opportunities in Saudi Arabia.

Energy Sector Opportunities in Saudi Arabia

With climate change and increasing global demand for energy, Saudi Arabia is looking to diversify its energy sources and increase the use of renewable energy. To accomplish this, the government has launched several major initiatives, which are focused on increasing the share of renewable energy sources in the national mix and increasing private sector participation. Here are some of the key developments to watch in 2023.

Solar Energy Industry

Saudi Arabia is home to some of the world’s largest solar farms and has set ambitious targets for the development of solar energy projects. It aims to generate 60 gigawatts of electricity from renewable sources by 2030 and unsurprisingly, most of this will come from solar.

The private sector is being heavily encouraged to take part in this project, and there are major opportunities for businesses that can provide technology, finance, or services to help make this a reality. The Sakaka power plant, which consists of 1.2 million solar panels arranged over 6 km² of land, was implemented by a private-sector company in an agreement with the Saudi Power Procurement Company.

Trading in electricity in Saudi Arabia is regulated by the Water and Electricity Regulatory Authority (WERA) and governed by the Electricity Law. Companies engaging in energy-related activities must obtain the relevant licenses and approvals from WERA, as well as comply with any regulations related to the import and export of electricity.

Incentives for Private Sector Participation

As part of the government’s National Renewable Energy Program (NREP) and Vision 2030, there are several incentives for private sector participation in renewable energy projects. Custom duties exemptions may be available for businesses that are importing equipment related to renewable energy projects and companies may also be able to apply for subsidized leases.

The Human Resources Development Fund will also finance employee salaries up to 15% for men and 20% for women. It’s also worth noting that 100% foreign direct ownership is now permitted in renewable energy projects in Saudi Arabia.

The Fourth Industrial Revolution

The Saudi government also created a National Industrial Development and Logistics Program (NIDLP) in 2019 to further develop and diversify its energy and mining sector. This program aims to create new jobs, grow the mining sector, develop new trade, transport, and logistics networks, and localize manufacturing using the latest technologies such as AI, IoT, and robotics.

This presents major opportunities for businesses in the technology sector that can provide the necessary services to help the government realize its vision of a digital-first economy. Tech companies wishing to do business in Saudi Arabia should be aware of the regulations and laws that are applicable to this specific sector, with particular attention to the Personal Data Protection Law (PDPL), which will come into full force later in 2023.

Saudi Arabia – A Future Hub of Renewable Energy

The Saudi government is committed to creating a vibrant, competitive, and diverse economy, and very soon there will be many opportunities available in the renewable energy and related technology sectors.

Companies seeking to do business in Saudi Arabia must be aware of the relevant regulations and laws, as well as the incentives that are available to them. With its legal framework in place, businesses in these industries can take advantage of an excellent range of opportunities and benefit from Saudi Arabia’s strategic location at the crossroads of Africa, Asia, and Europe.

The 2022 Roundup of KSA’s Sports & Media Industries

Posted on January 29, 2023 - 11:34 am by perpetual-admin

The sports and media industry in the Kingdom of Saudi Arabia (KSA) has undergone a significant transformation in the past few years. KSA is now home to a number of high-profile sports teams, such as Al-Hilal and Al-Nassr, who have made significant progress in their respective leagues. In addition to this, investment has been poured into the development of stadiums and other facilities to support the development of these teams, allowing them to compete at a high level both domestically and internationally.

The media industry also saw several positive initiatives and regulatory changes in 2022. In this article, we’ll explore some of the key developments in the sports and media industry in KSA over the course of 2022, as well as looking at what is likely to happen in 2023.

What Did 2022 Bring for the Sports & Media Industries?

The previous year was a milestone for the sports and media industries in Saudi Arabia. No roundup would be complete without a mention of Saudi Arabia’s impressive performance during the World Cup in Qatar. However, there have been many other notable developments that are set to shape the sector in 2023 and beyond. Let’s take a look at some of the highlights.

Sports

Football remains one of the most popular sports in the Kingdom. Out of all the Saudi residents who practise any sport, approximately 25% are participating in football. So it comes as no surprise that the KSA government is continuing to make huge investments in the development of football stadiums, training facilities, and academies to support grassroots development. In 2022, as part of this initiative, the Public Investment Fund (PIF) funnelled an impressive $2.3 billion worth of football sponsorships towards supporting football clubs and facilities in the region.

Saudi Arabia’s Sports for All Federation (SFA) also announced its ambition to construct six key sports facilities across the nation, each with 30-40 courts catered towards various sporting activities. It is estimated that more than 250,000 people will be drawn in to participate within the first year of operations.

2022 also saw the inaugural Saudi Games and NEOM Beach Games – two major sporting events that attracted both local and international competitors. With the success of these events and the continued investment in sports infrastructure, we can expect to see an increase in interest and investment from both local and foreign stakeholders within this sector.

Media

With the intent to stimulate creativity and innovation and propel Arab media into a globally competitive place, Saudi Arabia initiated the Montij initiative at the 22nd Arab Radio and Television Festival held in November 2022.

Meanwhile, new regulations for digital media creators were also introduced, with the announcement that social media advertisers and influencers were required to submit their application for a licence to the General Commission for Audiovisual Media (GCAM) before October 1, 2022, or risk a fine.

With regard to digital content platforms, the CITC announced a revised version of its Digital Content Platform Regulations in February 2022. After public consultation, the amended regulations were finally published in April 2022. This updated set of regulations is designed to provide a more precise regulatory framework for the digital content industry, demonstrating an alteration in the Kingdom’s handling of platform operators. For instance, language requiring platform operators/service providers to have a physical presence within the Kingdom has been relaxed.

Future Developments: 2023 and Beyond

With 2023 kicking off with the announcement that football mega player Cristiano Ronaldo would be signing for Al-Nassr, the sports industry in KSA is expected to draw even more global attention. As for the Kingdom’s media industry, the landscape is continuing to evolve rapidly.

Diriyah E-Prix – a Formula E Championship event in KSA held at the Diriyah Circuit – is set to be held from Jan 27th until Jan 28th 2023.
Saudi Media Forum 2023 – an annual event that brings together media professionals, specialists, and decision-makers from the region to discuss opportunities and challenges in the sector – is also set to take place in the Kingdom in 2023.
Bid for 2030 World Cup. Despite rumours of the Saudi Ministry of Tourism denying any plans for an official joint bid, they also have not ruled it out.

The developments of 2023 are expected to further fuel investment and innovation in the sector, as well as create greater opportunities for local and international stakeholders. With the right regulatory framework in place, and with continued government backing, KSA’s sports and media industry is set to become an even more competitive global force.