• Saudi Arabia’s Council of Ministers has approved a revised investment law, consolidating various investor rights and freedoms into a unified framework under Vision 2030 and the National Investment Strategy.
• The updated law introduces enhanced investor protections, streamlined regulatory processes, and promotes fair competition, aiming to boost transparency, flexibility, and confidence for investors.
• These reforms have already driven significant growth, with gross fixed capital formation increasing by 74% and FDI inflows by 158% between 2016 and 2023, demonstrating the Kingdom’s commitment to fostering a robust investment environment.

Saudi Arabia’s Council of Ministers has ratified a revised investment law, building upon the reforms outlined under Vision 2030 and the National Investment Strategy. This new law consolidates various existing rights and freedoms into a single, unified framework, enhancing transparency, flexibility, and investor confidence.

The updated legislation is grounded in international investment principles, offering enhanced protections for investors, including the rule of law, fair treatment, property rights, intellectual property protection, and the freedom to manage investments and transfer funds seamlessly. It also introduces a more transparent and unified legal structure, simplifies regulatory processes by replacing international investor licensing with a streamlined registration system, and promotes fair competition within a dynamic and innovative market environment.

Key provisions of the law include the establishment of dedicated service centers to facilitate government transactions and investment processes, ensuring equal procedural treatment for both domestic and international investors, and providing access to top-tier dispute resolution mechanisms in partnership with the Saudi Arbitration Centre and other affiliates.

These reforms, aligned with Saudi Arabia’s broader reform agenda, highlight the Kingdom’s dedication to attracting investment, even as global foreign direct investment (FDI) declines. According to the World Investment Report 2024 by UN Trade and Development, pro-investment measures have constituted less than half of the new investment policies introduced by advanced economies over the past six years.

Saudi Arabia’s recent pro-investment initiatives, such as the Civil Transactions Law, Private Sector Participation Law, Companies Law, Bankruptcy Law, and the establishment of Special Economic Zones, have significantly bolstered the investment climate. These efforts have contributed to rapid growth in investment, with gross fixed capital formation rising by 74% from 2016 to nearly $300 billion in 2023, and FDI inflows increasing by 158%, from $7.46 billion in 2017 to $19.3 billion in 2023.

Khalid Al-Falih, Minister of Investment, stated: “The law reaffirms Saudi Arabia’s commitment to creating a welcoming and secure environment for investors, driving economic growth, and enhancing the Kingdom’s position as a premier global investment destination. The policy direction outlined in Vision 2030 allows investors to invest with certainty and to grow with confidence at a time when many other markets are experiencing considerable volatility. The updated investment law builds on an extensive diversification agenda from an enhanced quality of life offering to investment-specific measures such as the establishment of special economic zones.”

Developed by the Ministry of Investment of Saudi Arabia (MISA), the revised law is the result of extensive consultations with investors and aligns with global best practices. It is also compatible with the Gulf Cooperation Council (GCC), World Trade Organization (WTO), and other bilateral investment treaties and international obligations. The executive regulations will come into force in 2025, according to the statement.