Saudi Arabia: Expectations for Saudi Fintech Sector

Arab News, 9 January 2022: Saudi Arabia saw a significant jump in venture capital investments in the financial technology sector, with 16 deals in the first eight months of 2021 totaling $157.2 million.

This compared with seven deals worth $7.8 million in 2020. 2021 also saw backing spread across a range of early-stage projects, with 46% at series A and B stages, 38% at the seed stage, and 15% at pre-see levels (where funding often comes from the founders, their family and supporters).

The payments sector remains the most attractive fintech area in Saudi, so far accounting for around 93% of total venture capital investments.

However, the median deal size in Saudi Arabia is $2.7 million compared to a global median deal size of $7.3 million.

The launch of Open Banking in Saudi Arabia in 2022, which allows firms to share consumer current account data once permission has been given, is also expected to speed up the pace of fintech development.

Experts expect this move will provide existing fintech investors with more opportunities, and will attract funds to the sector.

The Financial Sector Development Programme, launched in 2017 should also assist.

The plan includes developing the digital economy, and allowing financial intermediaries to support private sector growth by opening up the financial services industry to new players. It is also encouraging building of an advanced capital market in the Kingdom.

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Saudi Arabia: Anti-bribery Law Amended

Saudi Gazette, 7 December 2021: The Saudi Arabian authorities have approved amendments to the Kingdom’s Anti-bribery Law.

The first amendment sees the phrase every public employee replaced with every person.

Article 8(7) has been amended to read ‘Foreign public officials and employees of international institutions and organisations in connection with the conduct of international business’.

Finally, Article 15 has been amended to read ‘Judgment shall be issued in the case of a person, who has been proven guilty of the crime of bribery, to confiscate the money, advantage or benefit that involved in the crime whenever possible, or confiscate its value, as the case may be, and confiscate any proceeds from the money or advantage or benefit’.

The amendments were approved following a letter from the Oversight and Anti-Corruption Authority or Nazaha on proposed amendments to the Law. Also reported in Okaz on 7 December 2021. For full story, click here.

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Saudi Arabia: Residency Permits Now Being Issued and Renewed Quarterly

Saudi Gazette, 23 November 2021: The General Directorate of Passports or Jawazat has announced residency permits can now be issued and renewed quarterly.

The new service is being executed together with the Human Resources and Social Development Ministry and the Saudi Authority for Data and Artificial Intelligence.

It has been launched to implement a new Cabinet Decision which was issued to this effect.

Domestic workers and similar workers are exempt.

The residency permit will be renewed once the expatriate fee has been paid.

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Saudi Arabia: Landmark Insurance Product for Self-driving Vehicles Launched

Al-Eqtisadiya, 14 November 2021: Saudi Arabia’s Central Bank has announced it has launched a landmark insurance product for self-driving vehicles.

It is the first insurance product to cover self-driving vehicles and the associated risks.

It has been launched as part of efforts to support the insurance sector in developing and introducing new and innovative insurance products to achieve the objectives of the Financial Sector Development Programme.

It covers self-driving vehicles which can drive themselves from a starting point to a predetermined destination, using various technologies and sensors, including adaptive cruise control, active steering, anti-lock braking systems and GPS technology as well as laser technology, in places qualified and licensed by official authorities to use these types of vehicles.

For full story, click here.

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Saudi Arabia: Non-Saudis Can Invest in Real Estate Funds in Mecca and Medina

Arab News, 8 November 2021: Saudi Arabia’s Capital Market Authority has announced it will allow non-Saudis to invest in real estate funds in Mecca and Medina.

Financial market institutions can accept subscriptions of non-Saudis in these funds.

They invest in assets in these locations.

They can own real estate for their own residential purposes, once they have obtained a license from the Interior Ministry. Their foreign representatives will be able to own their official headquarters after obtaining a license from the Foreign Affairs Minister.

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Saudi Arabia: Fines for Building Without License Announced

Al Madina, 2 November 2021: Saudi Arabia’s Municipal and Rural Affairs and Housing Ministry has set the controls for dealing with buildings built without a legal license.

The aim is to limit violations.

The Ministry has also set out the mechanism for municipalities and secretariats to deal with these violations. These include removing the building completely if it contradicts with organisation planning. The violator must pay the costs of removal as well.

If the building is in line with the plans and does not cause harm to neighbouring buildings then the violator must pay a fine equivalent to 25% of the total value of the building plus the license fees. However, if the building does cause harm to others, it must be removed. For full story, click here.

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Saudi Arabia: Correction Period for Building Code Violation Announced

Okaz, 26 October 2021: Saudi Arabia’s Commerce Minister has announced an amendment to the regulation for classifying violations of the Saudi Building Code has been approved.

The Code started to be implemented recently.

Violators will have 90 days to undo the violation. After this they will be fined up to 10,000 Riyals among other penalties.

Violations include issuing an occupancy certificate for a building despite the presence of serious construction violations. The supervising office will be fined 7,500 Riyals in this case. Another violation includes assigning the supervising engineering office or the contractor executing their tasks, or part of them, to an individual who is not qualified in the relevant specialist field.

The supervising office will be fined 2,000 Riyals and the contractor will be fined 4,000 Riyals.

For full story see https://www.okaz.com.sa/news/local/2086247.

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Saudi Arabia: Draft Personal Status Law to be Published

Arab News, 25 October 2021: Saudi Arabia’s Justice Ministry has announced it is going to publish a draft of the Personal Status Law.

The Justice Minister made the announcement at the Saudi Family Forum 2021.

The legislation will be published as part of Vision 2030.

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Saudi Arabia: Insurance FinTech Technology Rules Proposed

Arab News, 18 October 2021: Saudi Arabia’s Central Bank has launched a consultation on proposed Insurance FinTech Technology Rules. The consultation ends on 16 November.

The new rules aim to allow insurance FinTechs to work within a regulatory framework which keeps up with general sectorial developments and insurance technology services in particular.

It covers features like encouraging fair competition, obligations for practitioners, the accuracy and preservation of customer information and other consumer rights.

Also reported in Al-Eqtisadiya on 18 October 2021. For full story see https://www.aleqt.com/2021/10/18/article_2192476.html.

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Saudi Arabia: Training Time for Lawyers Reduced

Al Madina, 14 October 2021: Saudi Arabia’s Justice Ministry has announced it is working on amendments to the Lawyers Law.

The amendments are aimed at improving the profession and preserving the rights of trainees and lawyers.

A consultation has been launched on the proposals which also includes a proposal to amend the training period for trainee lawyers to one year instead of five years.

Another amendment proposes that the training must be within the nature of the work and in line with the rules and controls set by the Ministry.

For full story, click here.

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