Doing Business in Saudi Arabia - International Franchise Association

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Since September 1994, the Ministry of Labor has been required to certify that there are no qualified Saudis for a particular job before an expatriate worker can fill that job. In addition, the original sponsor must approve all transfers of expatriate workers from his sponsorship to another (except in cases of non-payment of wages for three consecutive months or more). While group visas are available for unskilled and some skilled workers recruited abroad, the Ministry of Labor is actively trying to limit the numbers of visas being issued in its bid to create more job opportunities for Saudis. Saudi labor law forbids union activity, strikes, and collective bargaining. However, the Government allows companies that employ more than 100 Saudis to form “labor committees.” By-laws detailing the functions of the committees were enacted in April 2002. To date, 15 labor committees have been established. Domestic workers are not covered under the provisions of the new labor law issued in 2005. The Saudi Majlis al-Shura, a consultative assembly with a role in the legislative process, has passed a law covering domestic workers, which is now with the King and the Council of Ministers for review. Overtime is normally compensated at time-and-a-half rates. The minimum age for employment is 14. The Saudi government does not adhere to the International Labor Organization’s (ILO) convention protecting workers’ rights. A July 2004 decree addresses some workers, rights issues for non-Saudis, and the Ministry of Labor has begun taking employers to the Board of Grievances. Some of these penalties include banning these employers from recruiting foreign and/or domestic workers for a minimum of five years. Foreign-Trade Zones/Free Ports Return to top Saudi Arabia does not currently have duty-free import zones or free ports, but does permit transshipment of goods through its ports in Jeddah and Dammam. Saudi Arabia is a member of the Gulf Cooperation Council (GCC), which confers special trade and investment privileges within the six member states (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE). Saudi Arabia is also a member of the Arab League, which agreed to negotiate an Arab free trade zone. Foreign Direct Investment Statistics Return to top Figures provided in this section are taken from United Nations Conference on Trade and Development’s “World Investment Report 2009 Country Fact Sheet.” Following are key FDI indicators as provided by the referenced report for 2008 (all figures are in USD millions unless otherwise indicated): FDI Inflow 38,223.0 FDI Outflow 1,080.0 FDI Inward Stock 114,277.0 FDI Outward Stock 23,130.0 FDI Inward Stock as % of GDP 24.4 FDI Outward Stock as % of GDP 4.9 FDI Inflow as % of GFCF 46.1 FDI Outflow as % of GFCF 1.3 GDP = gross domestic product GFCF = gross fixed capital formation
Web Resources Return to top Saudi Arabian General Investment Authority (SAGIA) www.sagia.gov.sa SAGIA Business Centre Wizard www.sagia.gov.sa/en/Investor-tools/Business- Centre-Wizard/ Saudi Arabian Monetary Agency (SAMA) www.sama.gov.sa Capital Market Authority (CMA) www.cma.org.sa/cma_en/default.aspx Saudi Stock Exchange (Tadawul) www.tadawul.com.sa/ Communications and Information Technology Commission (CITC) www.citc.gov.sa Royal Commission for Jubail and Yanbu www.rcjy.gov.sa/portal/default.asp?lang=eng Ar-Riyadh Development Authority (ADA) www.arriyadh.com/eng/ada/index.aspx Saudi Industrial Development Fund www.sidf.gov.sa/english/index.htm Ministry of Labor www.mol.gov.sa/HomePage/home.html Saudi Customs Authority www.customs.gov.sa/CustomsNew/default_E.aspx Return to table of contents
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Doing Business in Saudi Arabia: 201
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• Intellectual Property Protectio
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Return to table of contents Chapter
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Since this is a common practice in
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Franchising Return to top Franchisi
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companies interested in operating i
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Other entities created by the CML i
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Pricing Return to top The governmen
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Al-Jazira Al-Watan Newspaper Arab N
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Engineering & Architectural Service
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units and 150,000 square metres of
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and has earmarked $8 billion for ne
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knowledge-based industries in Madin
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Medical Equipment - MED Overview Re
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Ministry of Health www.moh.gov.sa M
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as Marafiq. This company is respons
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• Anti-scaling chemicals • Oper
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traffic flow. Non-food franchises a
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Saudi Arabia’s Homeland Security
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Saudi Arabia’s education system i
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Education Trade Fairs in Saudi Arab
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$90 billion expected to be spent on
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Gulf where a major port will be con
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total of $109 billion on railway ex
Page 49 and 50: But over the course of the program,
Page 51 and 52: Al-Qurayyat PP Ext. # 2 - 110 MW -
Page 53 and 54: prepared based on the planned capac
Page 55 and 56: Oil & Gas Field Machinery - OGM Ove
Page 57 and 58: seems that Saudi Aramco has started
Page 59 and 60: In 2000, Saudi Arabia passed the Fo
Page 61 and 62: Air-Conditioning & Refrigeration Eq
Page 63 and 64: Major Projects Some multi-billion d
Page 65 and 66: growth will be sustained for years
Page 67 and 68: • Car Batteries • Maintenance a
Page 69 and 70: Islamic center in the country of or
Page 71 and 72: educe its soybean import subsidy fr
Page 73 and 74: Tel.: (+971-4) 332-1000 Fax: (+971-
Page 75 and 76: and vegetable juices, mineral and o
Page 77 and 78: However, SPO applied the new law re
Page 79 and 80: Saudi Customs requires a deposit fo
Page 81 and 82: standards. The Communications and I
Page 83 and 84: Publication of Technical Regulation
Page 85 and 86: efficient customs procedures, and g
Page 87 and 88: contracts, a restrictive visa polic
Page 89 and 90: equirements defined in the Ministry
Page 91 and 92: Of interest to investors who have d
Page 93 and 94: capacity through training, has stre
Page 95 and 96: local investment houses. These allo
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Page 99: • The World Bank Institute publis
Page 103 and 104: licenses were also granted to Deuts
Page 105 and 106: allocated $36.5 billion for the edu
Page 107 and 108: Recently, the Saudi Fund for Develo
Page 109 and 110: Return to table of contents Chapter
Page 111 and 112: visas will likely become the norm o
Page 113 and 114: Transportation Return to top The bu
Page 115 and 116: Web Resources Return to top Travel
Page 117 and 118: Saudi Basic Industries Corporation
Page 119 and 120: E-mail: abondthorley@fmi.org, sgeor
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Doing Business in Saudi Arabia - International Franchise Association

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