Introduction: Investment as a Strategic Tool for the Kingdom’s Vision

Investment represents one of the key pillars of Saudi Arabia’s Vision 2030, which seeks to diversify the national economy and reduce reliance on oil by stimulating both local and foreign investments across various sectors.

In this context, the New Investment Law of 1446H (2024) was issued as a major legislative milestone designed to regulate the investment environment, enhance competitiveness, and attract capital in alignment with the national goals of the Vision.

Key Features of the New Investment Law 1446H:

The new law replaces the Foreign Investment Law and is applied comprehensively to all types of investors—Saudi and foreign alike—based on the principles of equal opportunity and fair treatment. Some of its most notable provisions include:

• Freedom of Investment and Ownership: The law permits 100% foreign ownership in most sectors.
• Fairness and Equality: Local and foreign investors are treated equally in terms of rights and obligations.
• Transparency: The law requires competent authorities to disclose all licensing procedures and requirements.
• Legal Guarantees: Expropriation is prohibited except for public interest and with fair compensation, with the option to resort to arbitration.

This law was drafted in line with international best practices and in accordance with global investment agreements to which the Kingdom is a party.

How Does the Law Support Vision 2030 Objectives?

The investment aspect of Vision 2030 focuses on several key objectives, including increasing foreign direct investment, boosting the private sector’s contribution to GDP, generating employment, and expanding the non-oil economic base.

The New Investment Law contributes to these objectives through:

• Facilitating Company Formation: Streamlining procedures, accelerating licensing, and using digital platforms such as “Invest Easily.”
• Encouraging Strategic Sectors: Offering incentives to investors in fields such as renewable energy, technology, industry, and logistics.
• Supporting Innovation and Entrepreneurship: Allowing intangible assets—such as intellectual property—to be used as part of investment capital.

According to the General Authority for Statistics (2024), foreign direct investment inflows increased by 17% compared to the previous year—reflecting the impact of the new law on the Kingdom’s investment attractiveness.

Guarantees and Facilities Provided to Investors:

The new law stands out for creating a secure and stimulating legal environment through:

• Freedom to transfer profits and returns outside the Kingdom.
• The right to file grievances before competent authorities or the judiciary in case of disputes.
• Access to tax and customs incentives in certain regions and sectors.
• The ability to obtain multiple activity permits under a single investment entity.

The executive regulations also require investment-related government entities to avoid delaying investor procedures or discriminating without legal justification—thereby strengthening local and international investor confidence.

Conclusion and Investor Guidance:

There is no doubt that the New Investment Law represents a transformative shift in the Kingdom’s regulatory environment and reflects the government’s commitment to achieving Vision 2030 goals by empowering investment and enhancing competitiveness.

With expanding investment opportunities across the Kingdom, it has become essential for local and international investors to understand the new legal provisions to avoid risks and maximize the benefits of available incentives.

Practical Guide for New Investors:

1. Identify the target economic activity according to the Ministry of Investment’s classification.
2. Submit the licensing application through the “Invest Easily” platform.
3. Complete commercial registration and all regulatory permits.
4. Follow registration procedures and begin operations immediately.
5. Maintain your legal and financial records regularly to ensure compliance.

Frequently Asked Questions (FAQ):

1- What is the scope of the new Investment Law?

The law applies to all investors—Saudi and foreign—and covers all sectors not explicitly exempted by the state.

2- Does the law allow 100% foreign ownership?
Yes, in most sectors, without the need for a local partner, in accordance with regulatory requirements.

3- Which authorities issue investment licenses?
The Ministry of Investment is the primary authority, in coordination with relevant sectoral entities depending on the activity.

4- Can an investor appeal if their license is rejected?

Yes, the investor may file an appeal before the Ministry within 30 days. If no decision is made, they may escalate the appeal to the judiciary.

5- What incentives are available to investors?
They include tax incentives, financing facilities, and property ownership privileges depending on the activity and location.