Weekly Spotlight: Saudi Arabia has announced foreigners will be able to own 100% of construction and engineering businesses
This week the spotlight is on legal and regulatory developments in Saudi Arabia, where the Commerce and Investment Ministry and the General Investment Authority (Sagia), have announced foreigners will be able to own 100% of construction and engineering businesses. It follows a consultation which has recently concluded. Foreigners will be able to own 100% of these businesses so long as they have a 10-year operational track record and have a presence in at least four other countries. Sagia will be able to waive these restrictions if an application is considered to be in the Kingdom’s best interests.
Elsewhere, the Head of Saudi Arabia’s General Authority for Civil Aviation, Abdul Hakim Al-Tamimi has announced all of the Kingdom’s airports will be privatised by December this year. All of the country’s airports will be transferred to the Saudi Civil Aviation Holding Co first. They will then be transferred to the Public Investment Fund (PIF). The privatisation will be carried out in three ways. The first will see an airport transferred to a company like Riyadh’s King Khaled International Airport, where a minority holding was sold and an airport board of directors will then be established which will manage the company. The second is known as operation and maintenance like Jeddah’s King Abdul Aziz International Airport in Jeddah where the Civil Aviation Authority bears the capital cost of establishing the project and shares the income with investors. The third method is through Build, Operate and Transfer, like Madinah’s Prince Mohammed bin Abdul Aziz Airport where employees are an investor’s responsibility. The investors bear the capital cost of the project and share the income with the Authority.