SAUDI ARABIA
MARKETING AND SALES STRATEGY
MARKETING AND SALES STRATEGY
There are very good prospects for Foreign companies who want to export their
products to the Saudi Arabian market. However, there are certain marketing
procedures and sales techniques which have to be observed in order to develop and
sustain business relationships over a long period of time.
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The Saudi market should be constantly reviewed for product adaptation and
change.
Exporters should ensure regular supplies as per specifications, at the specified
time and place already agreed upon and at the stipulated prices.
Any subsequent and sudden price changes, even pertaining to after-sales
services, should be avoided.
Exporters' contacts with importers in Saudi Arabia should be direct and regular.
Complete product lines, rather than single products, should be introduced into
the Saudi market whenever possible in order to benefit from greater demand
stimulation and cost reductions.
Exporters are required to check with Saudi importers or directly with the Saudi
Arabian Standards Organization, on the precise implementation of Saudi
Arabian Standards pertaining to their exported products to the Kingdom. Saudi
Standards can be purchased from SASO or the American National Standards
Institute, ANSI (11 West 42nd Street, New York City, NY 10036, telephone
number (212)642-4900 or fax number (212)302-1286).
Exporters to Saudi Arabia should display their products regularly in the major
commercial urban centers of the Kingdom. Necessary permission is obtained by
writing or contacting directly the Director, Exhibitions Department, Ministry of
Commerce.
Efforts should be made to improve the appearance of exported commodities by
means of attractive packaging.
Products to be exported should be properly branded and labeled both in English
and Arabic.
In the case of machinery and equipment; after-sales service, including
warranties, maintenance and the provision of spare parts, should be prompt
and efficient.
BUSINESS OPPORTUNITIES IN THE KINGDOM
In pursuit of the policy of free market enterprise, economic diversification, structural
shift from building the infrastructure to the production of goods and services and the
subsequent increasing reliance on the private sector as the major economic force, the
Kingdom of Saudi Arabia invites Foreign companies to participate in the following areas
which are essential to its current and future economic growth:
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Import-substitution and export-oriented joint ventures.
Projects contributing to technological progress in the Kingdom and the
development of established factories through improvement of production
methods and minimization of production costs.
Projects directly related to the current economic development in the Kingdom
which include, but are not limited to, the following:
a) Industries utilizing locally abundant raw materials from petrochemical or
petroleum products.
b) Food industries utilizing locally abundant agricultural products.
c) Specialized industries in the fields of maintenance and the manufacturing of
spare parts and equipment.
In most of the industrial joint ventures, the foreign partner supplies the management,
technical expertise, and part of equity resources, if they are desired, depending on the
collaboration arrangements. The Saudi partner provides local supervision, local skilled
and unskilled labor, and handles local business contacts, apart from participating in the
equity resources. For further details on establishing joint ventures in the Kingdom,
Industrial Licensing Regulations and Procedures.
With a foothold in the Saudi Arabian market, there will be numerous business
opportunities for:
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Companies providing labor-saving equipment and services.
Training services either directly delivered or as part of a product package.
Managerial services either directly delivered or as part of a product package.
Nearly all areas of health, personnel, and services.
In addition to the section on growth targets during the sixth development plan that we
discussed in Chapter Two of this guide, the following list of principal growth areas of
the Saudi Arabian economy provides tips on prospective commercial opportunities in
the Kingdom:
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Industry: Most industrial activities in the Kingdom are carried out by the
energetic Saudi private sector. The structure of the Saudi Arabian industrial
sector is composed of three distinct sub-sectors: petrochemicals, oil refining,
and other manufacturing. The main objectives of the Kingdom’s industrialization
are:
a) To reduce the Kingdom’s dependence on the export of crude oil as the major
source of income
b) To increase Saudi Arabian private sector participation in the economic
development of the country
c) To create new job opportunities.
d) To establish an advanced industrial and technological base.
Export oriented industries such as petrochemical, papers, glass plastics, etc. are
expected to do well during the sixth plan period. Over the next few years the
petrochemical industry is expected to grow at an average rate of more than 8 percent
annually. Thus foreign investors are invited to join the Saudi Arabian private sector to
invest in new industries that utilize modern technology, and to expand investment in
import substitution and export-oriented industries including basic, supporting and
downstream metal and petrochemical industries
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Mining and quarrying: The Saudi government has prioritized the diversification
of the Kingdom’s economy and the utilization of the country’s extensive mineral
wealth. The mining industry is promising in the next few years, especially with
the initiative of the Ministry of Petroleum and Mineral Resources to develop new
mines to produce phosphate, iron, bauxite and other precious and non-precious
metals. In 1993 Petromin extracted 189,353 tons of ore. Net gold production
amounted to around 670,000 ounces between 1989-1993. The Directorate
General of Mineral Resources is currently pursuing the exploitation of the
mineral fields throughout the Central and Western regions of the Kingdom. The
government’s investment in this sector has already exceeded seventeen billion
Saudi Riyal (more than U.S. $4.5 billion). Foreign investors are offered tax
exemption, long term extraction concessions and other incentives to invest or
establish joint ventures in this growing Saudi industry.
Transportation, telecommunications and information technology: During the
fifth development plan (1990-1994) the Kingdom’s main road network
increased by about 2,100 KM, to about 43,000 KM. Rail freight volume grew by
36 percent to about 2.1 million tons. Air passenger volume grew from 20.3
million departure and arrival to 25.1 million. The cargo handled in the
Kingdom’s major ports rose from 63.7 million tons to 83 million tons.
In addition to upgrading the road network and domestic airports in the Kingdom during
the sixth development plan, the government is planning to link Dammam and Jubail
Industrial City with a new railroad. Furthermore, to enhance and modernize the fleet of
Saudi Arabian Airlines, the government has already purchased from two American
companies (Boeing and McDonnell Douglas) commercial airplanes worth more than six
billion dollars. The Saudi Ministry of Post, Telephone and Telegraph awarded the U.S.
firm of AT&T four billion dollars contract to upgrade and expand the telephone network
in the Kingdom.
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Electricity: Saudi per capita consumption of gas, water and electricity is one of
highest in the world. Over the past two decades electricity consumption rate
increased by more than 20 percent annually. Power generation expanded from
4,214 megawatts in 1979 to 18,238 megawatts in 1994. Over the sixth
development plan period (1995-1999) electric generation capacity will be raised
by more than seven thousand megawatts.
Other important areas of growth prospects during the sixth development plan
(1995-1999), include banking and insurance, leasing, travel, and consumer
products such as food and beverages, clothing, soap, cosmetics, etc.
A further consideration for business opportunities is the procurement of government
contracts. Government contracts are often offered through tenders. There is no central
tenders’ board in Saudi Arabia, and every government agency may extend contracts.
Bids for tenders must be applied for by local agents. In most cases, government
contracts awarded to foreign companies require 30 percent of the total work to be
subcontracted to a Saudi Arabian contractor.
REGULATIONS FOR COMPANIES
Formation and operation of business firms and companies is
regulated by companies Law promulgated by Royal Decree No.
M/6 dated 22 Rabi I 1385 H., (1965). Royal Decree No. M/5
dated 12 Safar 1387 H. (1967) and Royal Decree No. M/23
dated 28 Jumada II 1402 H. (1982) amended the regulations for
companies. Under Article 1 of the Companies Law, a company
has been defined as a contract pursuant to which each of two or
more persons undertake to participate, in an enterprise aiming
at profit, by offering in specie or as work a share, for sharing in
the profits or losses resulting from such enterprise.
Following are some of its important provisions:
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Under article 2, companies can take any of the following
forms:
General Partnerships.
Limited partnerships.
Joint Ventures.
Corporations.
Partnerships Limited by Shares.
Limited Liability Partnerships.
Variable Capital Companies.
Cooperative Companies.
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Without prejudice to the companies acknowledged by the
Islamic "Shari’ah" Law, any company not having any of
the legal forms as given in Article 2 of the Companies
Law shall be null and void.
Partner's contribution may consist of a certain sum of
money (a contribution in cash), or of a capital asset (a
contribution in kind). It may also comprise services
except in the cases where the provisions of the
Companies' Regulations imply otherwise, but it may not
consist (solely) of the partner's reputation or influence.
Every partner shall be considered indebted to the
company for the contribution he has undertaken to make.
If he fails to surrender it on the date set therefore, he
shall be liable to the company for any damages arising
from such delay.
Save in the case of a joint venture, a company's
memorandum of association and any amendment thereto
must be recorded in writing in the presence of a registrar.
Otherwise, such memorandum or amendment shall not
be valid vis-à-vis third parties.
With the exception of joint ventures, any company
incorporated in accordance with these Regulations shall
establish its head office in the Kingdom. It shall be
deemed to have Saudi nationality, but this shall not
necessarily entail its enjoyment of such rights as may be
restricted to Saudis.
For details pertaining to formation and operation of companies,
please contact Companies Department, Ministry of Commerce
(see here for address).
THE TAX SYSTEM:
The Kingdom of Saudi Arabia has a very liberal tax system;
there are few taxes payable by an individual or a company and
they are also at very low rates.
1. Zakat
The Zakat (a form of tithe) is paid annually by Saudi
individuals and companies within the provisions of Islamic
law as laid down by Royal Decree No. 17/2/28/8634
dated 29/6/1370 H. (1950). The Zakat is an annual flat
rate of 2.5 percent of the assessable amount.
2. Personal Income Tax
For individual employees, both national and expatriate,
there is no income tax in the Kingdom.
Self-employed expatriates such as doctors, accountants,
lawyers, etc. pay taxes on their net annual income at the
following rates:
Net Income (per year) Tax Rate (percent)
First 6,000
From SR 6,001 - 10,000
Exempted
5
From SR 10,001 - 20,000
10
From SR 20,001 - 30,000
20
Over SR 30,000
30
A slab system is followed to calculate such taxes.
3. Tax on Business Income:
A company, under the tax regulations, means a company or
partnership having material gain as the basic objective. The
taxable incomes of companies include:
* profits of a foreign company;
* shares of non-Saudi sleeping partners in the net profits of
partnership companies.
All legitimate business expenses and costs, including business
losses and depreciation, are deductible in computing net profits.
Any reasonable method of depreciation may be adopted by the
company but the same must be adhered to from year to year.
Capital gains are included in the profits of the company. The
following tax rates, on a slab basis, are now in force:
Net Profit Level
Tax Rate (percent)
First SR 100,000
25
From SR 100,001-500,000
35
From SR 500,001-1,000,000 40
Over SR 1,000,000
45
Income tax is charged at different rates for companies
engaged in the production of petroleum and hydrocarbons in the
Kingdom.
Every company is required to submit a financial statement on
an official form and to pay the tax not later than the 15th day of
the third month of the year following the Saudi Arabian fiscal
year, which commences on the 10th of Capricorn (December
31).
Companies formed under the provisions of the Foreign Capital
Investments Regulations with participation of Saudi capital of
not less than 25 percent are exempt for up to ten years from
payment of income tax.
For further details, please contact the Ministry of Finance and
National Economy, Directorate of Zakat and Income, Companies
Department, (see here for address). Note the New Amendments
according to the new Foreign investment Law below:
For purpose of the State bearing 15% of taxes imposed on
companies' profits that exceed one hundred thousand Riyals. this
percentage shall be calculated out of the tax brackets values
provided for in Article (11) dated 21/1/1370(H). This shall include
all capital companies subject to tax with the exception of
companies operating in the field of oil, gas and hydrocarbon
production.
2. The State's bearing this tax percentage is limited only to profits
which exceed one hundred thousand Riyals per year. Accordingly,
this shall be carried out when collecting taxes from the capital
companies as follows:
1. First bracket: 1 - 100,1000 SR.
value 25%
2. Second Bracket: 100,001 - 500,000
value 20% in lieu of
1.
35%
3. Third bracket: 500,001 - million Riyals value 25% in lieu of
40%
4. Fourth bracket: Over million Riyals
value 30% in lieu of
45%
Net losses which may be carried forward shall be determined by
the legally amended operational losses without regard to book
losses. Operational losses shall mean expenses which are legally
deductible in accordance to Article 14 of the Tax Law and which
are in excess of the income subject to tax during the taxable year.
4. All subject who keep regular account and who are subject to
Income Tax pursuant to the aforementioned Royal Decree shall
benefit from the principle of reallocating losses.
5. Subjects exempted from tax shall not benefit from the principle of
subsequent to the issuance of the aforementioned Resolution of
the Council of Ministers and shall not include the accounts of
previous fiscal years whether such accounts were submitted to
the department or not, or by tax Dispute Committee or Appellate
Committees.
6. This Resolution is applicable on fiscal years which end at dates
that are subsequent to the issuance of the aforementioned
Resolution of the Council of Ministers and shall not include the
accounts of previous fiscal whether such accounts were submitted
to the department or not, or by Tax Dispute Committees or
Appellate Committees.
Amendments:
Tax on Foreign Firms Slashed
3.
JEDDAH, 29 April 2003 — Saudi businessmen have welcomed
yesterday’s Shoura Council decision to cut taxes on profits of
foreign companies from 45 percent to a maximum of 25 percent,
saying the move will boost foreign investment
COMMERCIAL REGISTRATION SYSTEM:
The Statute of Commercial Registration System as contained in the Council of Ministers
Resolution No. 54 dated 29 Rabi II 1375 H. (1955) and No. 112 dated 13 Shawwal
1375 H. (1955) requires every industrial or commercial establishment, local and
foreign, to be registered with the commercial registration offices of the Ministry of
Commerce established in all the major towns of the kingdom. Some of the salient
features of the system are:
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Branches of foreign business establishments or Saudi agents
representing them must obtain prior approval of the Foreign Capital
Investment Committee, Ministry of Industry and Electricity, after which
they must register with the Ministry of Commerce within one month of
the commencement of their business.
All additional units or branches should also be registered within one
month of commencement of business.
All subsequent changes in particulars must be reported within one month
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of their occurrence.
The prescribed application forms to be filled out require information such
as names of the establishment and owners, their nationalities, the
amount of capital and shares in the capital of each owner, etc
COMMERCIAL AGENCY REGULATIONS:
The Commercial Agency Regulations were promulgated by Royal Decree No. 11 dated
20 Safar 1382 H. (July 1962). Following are some of its salient features:
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Non-Saudis shall not be permitted to act as commercial agents in Saudi
Arabia.
No person may act as commercial agent unless his name has been
entered in the Register maintained for that purpose by the Ministry of
Commerce.
The fees for registration in the agency register shall be SR 50 for an
individual trader and SR 100 for a company, payable only once.
Further Implementation Rules for "Commercial Agencies Regulations" were issued
under Minister of Commerce Order No. 1897 dated 24-5-1401 H. (March 30, 1981). A
sample of the "CONTRACT OF AGENCY" prepared by the Ministry of Commerce
according to Royal Decree No. M/32 issued on 10 Sha'ban 1400 H. (1980), amending
the above-mentioned Royal Decree, has been included (Here).
TENDERS REGULATIONS AND RULES FOR IMPLEMENTATION:
There is no central tenders board and every government agency is empowered to enter
into contracts. The Kingdom supplemented the existing tenders regulations through
Royal Decree No. M/14 issued on 7 Rabi II, 1397 H. (March 27, 1977). These
regulations contain 14 Articles and govern bid submission, methods of procurement
and performance, contract award, bid award and contracting authority, contract
conditions, advance payments, delay fine, contract forms, etc. Article 14 stipulates
that these regulations shall cancel and supersede all contradictory rules. Further, Rules
for Implementation of Tenders Regulations were issued under ministerial Resolution
No. 2131/97 dated 5 Jumada I 1397 H. (April 23, 1977). These rules contain 40
Articles and govern advertisement of tenders, manner in which they are submitted, bid
evaluation process, time for acceptance of contract award, etc.
Council of Ministers Resolution No. 124 dated 29/5/1403 H. (March 14, 1983) requires
that not less than 30 percent of contracts of "public works contracts" that require the
performance of works, such as construction contracts generally, as well as
maintenance and operations contracts, won by a foreign contractor or any Saudiforeign joint venture prime contractor (with less than 51% Saudi capital), must be
sub-contracted to contractors who are at least 51 percent Saudi owned and sponsor
their own workers.
REACHING THE SAUDI ARABIAN MARKET
REACHING THE SAUDI ARABIAN MARKET
Saudi Arabia is a country full of actual and potential business and investment
opportunities. However, it should be noted that the Saudi Arabian market is highly
competitive and business transactions take place on the basis of quality and cost. In
addition to the availability of an advanced and continually upgraded infrastructure, the
following factors facilitate foreign investments in Saudi Arabia:
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Free entrepreneurial spirit, respect for private ownership and an
energetic private sector.
Availability of capital, convertibility of the Saudi Riyal to hard currencies
and stability of exchange rates.
Protection of trade marks, patents and copy rights.
Absence of controls on capital movement and repatriation of profits.
Availability of an advanced and excellent banking system.
A liberal tax system.
ESTABLISHING BUSINESS CONTACTS
Foreign individuals or firms contemplating doing business in or wishing to export their
products to Saudi Arabia are required to look for a Saudi Arabian partner, an import
agent or local representative in close proximity to the Saudi Arabian market. See the
standard form of "CONTRACT OF AGENCY OR DISTRIBUTORSHIP"
Establishing personal and direct contacts with the Saudi business community is the key
to business success in the kingdom. When contemplating doing business in Saudi
Arabia, potential investors are urged to make use of the following channels of business
contacts:
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The Saudi Chambers of Commerce and Industry located in the major
urban centers of the Kingdom should be contacted, as a matter of
priority, to find a representative, distributor, partner or agent in Saudi
Arabia. Names of various products and Saudi importers of those
products could also be obtained directly from these Chambers.
Credibility reports about prospective Saudi business partners are often
available at these Chambers. A list of Saudi Chambers of Commerce and
Industry with their addresses and telephone numbers is supplied.
The Saudi Chambers of Commerce and Industry publish trade directories
of their respective business communities. These can be obtained by
contacting the appropriate Chamber directly.
Various advertising agencies, newspapers and internet marketing
services providers in the Kingdom should be contacted to utilize their
services for advertising export products. Additionally, some of the major
Chambers of Commerce and Industry, located in important urban
centers, have their own periodicals and may publish, upon request and
for a fee, information relating to commercial offers, "Wanted"
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

advertisements and others. all of these services could be arranged for
your company trough our own company by emailing our marketing
department with your specific requests also you are welcome to use our
Business Opportunity section and our Classifieds section.
In addition to its role as a part of the Kingdom's diplomatic mission to
any foreign country, the Commercial Office of the Royal Embassy of
Saudi Arabia in your country, provides the business community with
information about Saudi business regulations and procedures, and
means of doing business in the Kingdom. It also facilitates commercial
contacts, sponsors Saudi business shows, exhibits and trade missions to
the foreign countries, participates in seminars, meetings, conferences,
etc., that promote Foreign-Saudi business and trade, and mediates
commercial disputes between Foreign and Saudi companies, if both
parties are willing to cooperate in order to reach an out-of-court
amicable solution.
Foreign firms are encouraged to take advantage of the opportunity to
attend trade shows or to participate in Foreign trade missions to Saudi
Arabia. for American companies The Office of the Near East, at the U.S.
Department of Commerce (14th Street and Constitution Ave., N.W.,
Washington, D.C. 20230, Tel: (202)482-870) offers market information,
identifies trade leads and promotes trade shows and U.S. trade missions
to Saudi Arabia. Information regarding U.S. trade with Saudi Arabia and
related Department of Commerce services is available via the automated
Flash Fax hot line, which may be accessed by dialing (202)482-1064.
In addition, the Department's District Offices provide a number of export
promotion services, including the Agent/Distributor Service, which
identifies Saudi Arabian agents/distributors who are capable of handling
your business matters in the Kingdom, and the World Traders Data
Report, which evaluates potential trading partners overseas.
It is advisable to personally visit the Kingdom to establish direct contacts
with the Saudi business community. In order to obtain a short visit
business visa, normally valid for one to three months, the nearest Saudi
Arabian Royal Embassy or Consulate should be contacted. (A list of
Saudi Arabian Embassy or Consulate Offices in the U.S. is provided, and
a list of Saudi Diplomatic Missions in the rest of the world is provided.
REACHING THE SAUDI ARABIAN MARKET
REACHING THE SAUDI ARABIAN MARKET
Saudi Arabia is a country full of actual and potential business and investment
opportunities. However, it should be noted that the Saudi Arabian market is highly
competitive and business transactions take place on the basis of quality and cost. In
addition to the availability of an advanced and continually upgraded infrastructure, the
following factors facilitate foreign investments in Saudi Arabia:


Free entrepreneurial spirit, respect for private ownership and an
energetic private sector.
Availability of capital, convertibility of the Saudi Riyal to hard currencies
and stability of exchange rates.




Protection of trade marks, patents and copy rights.
Absence of controls on capital movement and repatriation of profits.
Availability of an advanced and excellent banking system.
A liberal tax system.
ESTABLISHING BUSINESS CONTACTS
Foreign individuals or firms contemplating doing business in or wishing to export their
products to Saudi Arabia are required to look for a Saudi Arabian partner, an import
agent or local representative in close proximity to the Saudi Arabian market. See the
standard form of "CONTRACT OF AGENCY OR DISTRIBUTORSHIP"
Establishing personal and direct contacts with the Saudi business community is the key
to business success in the kingdom. When contemplating doing business in Saudi
Arabia, potential investors are urged to make use of the following channels of business
contacts:





The Saudi Chambers of Commerce and Industry located in the major
urban centers of the Kingdom should be contacted, as a matter of
priority, to find a representative, distributor, partner or agent in Saudi
Arabia. Names of various products and Saudi importers of those
products could also be obtained directly from these Chambers.
Credibility reports about prospective Saudi business partners are often
available at these Chambers. A list of Saudi Chambers of Commerce and
Industry with their addresses and telephone numbers is supplied.
The Saudi Chambers of Commerce and Industry publish trade directories
of their respective business communities. These can be obtained by
contacting the appropriate Chamber directly.
Various advertising agencies, newspapers and internet marketing
services providers in the Kingdom should be contacted to utilize their
services for advertising export products. Additionally, some of the major
Chambers of Commerce and Industry, located in important urban
centers, have their own periodicals and may publish, upon request and
for a fee, information relating to commercial offers, "Wanted"
advertisements and others. all of these services could be arranged for
your company trough our own company by emailing our marketing
department with your specific requests also you are welcome to use our
Business Opportunity section and our Classifieds section.
In addition to its role as a part of the Kingdom's diplomatic mission to
any foreign country, the Commercial Office of the Royal Embassy of
Saudi Arabia in your country, provides the business community with
information about Saudi business regulations and procedures, and
means of doing business in the Kingdom. It also facilitates commercial
contacts, sponsors Saudi business shows, exhibits and trade missions to
the foreign countries, participates in seminars, meetings, conferences,
etc., that promote Foreign-Saudi business and trade, and mediates
commercial disputes between Foreign and Saudi companies, if both
parties are willing to cooperate in order to reach an out-of-court
amicable solution.
Foreign firms are encouraged to take advantage of the opportunity to

attend trade shows or to participate in Foreign trade missions to Saudi
Arabia. for American companies The Office of the Near East, at the U.S.
Department of Commerce (14th Street and Constitution Ave., N.W.,
Washington, D.C. 20230, Tel: (202)482-870) offers market information,
identifies trade leads and promotes trade shows and U.S. trade missions
to Saudi Arabia. Information regarding U.S. trade with Saudi Arabia and
related Department of Commerce services is available via the automated
Flash Fax hot line, which may be accessed by dialing (202)482-1064.
In addition, the Department's District Offices provide a number of export
promotion services, including the Agent/Distributor Service, which
identifies Saudi Arabian agents/distributors who are capable of handling
your business matters in the Kingdom, and the World Traders Data
Report, which evaluates potential trading partners overseas.
It is advisable to personally visit the Kingdom to establish direct contacts
with the Saudi business community. In order to obtain a short visit
business visa, normally valid for one to three months, the nearest Saudi
Arabian Royal Embassy or Consulate should be contacted. (A list of
Saudi Arabian Embassy or Consulate Offices in the U.S. is provided, and
a list of Saudi Diplomatic Missions in the rest of the world is provided.
IMPORTANT BUSINESS REGULATIONS AND
PROCEDURES
INTRODUCTION
Saudi Arabia pursues a liberal trade policy with no quantitative or
price restrictions for importers. However, there are a number of
regulations and procedures governing business and trade in the
Kingdom and adherence thereto could be very helpful for those
intending to do business in Saudi Arabia.
CUSTOMS DUTIES
According to Royal Decree No. M/13 dated 10/5/1408 H.,
corresponding to 12/30/1987, and to the Saudi Council of
Ministers order No. 86 dated 10/5/1408 H. (12/19/87) the
following customs duties' rates have been in effect since
13/5/1408 H. (corresponding to January 2, 1988):
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Most of the basic consumer products are duty free,
e.g., sugar, rice, tea, unroasted coffee, cardamom,
barley, corn, livestock and meat (fresh or frozen).
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Customs duties of 20% are imposed on some
imported commodities for the purpose of
protecting the national infant industries.
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Customs duty on other items is 5% (Reduced to
5% recently)on the total cost value CIF (cost+
insurance+ freight).
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A limited number of items are subject to customs
duties calculated on the basis of metric weight or
capacity, rather than ad Valorem. However, the
rates for these items are fairly low.
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Members of the Arab League who are signatories to
the Agreement to Facilitate Trade and Exchange
and to Organize Transit between the Arab League
States are granted special concessions.
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Imports from the Arab states with which Saudi
Arabia has bilateral trade agreements are entitled
to further reductions of duty.
Royal Decree No. M/56 dated 19/10/1407 H., corresponding to
June 15, 1987, has approved the international Brussels
agreement of 14 June 1983 on the Harmonized Commodity
Description and Coding System (HS). According to the Minister of
Finance and national Economy Order No. 3/1805 dated
19/10/1410 H., corresponding to May 14, 1990, the Kingdom has
been implementing the Harmonized System since 15/6/1411 H.,
corresponding to 1/1/1991. For details, contact Customs
Department (address).
IMPORTANT SPECIAL SHIPPING DOCUMENTS
SPECIAL DOCUMENTS:
As mentioned earlier, depending on the nature of exported
goods to Saudi Arabia, or according to a request from the Saudi
importer, certain documents may be required in addition to the
standard set of six shipping documents. Special certificates or
documents are also required to be authenticated in accordance
with the procedure for authentication of shipping documents
delineated above. The most important of these certificates or
documents are the following:
A. Food Products' Export Documents:
Requirements for labeling of food and food products sold in the
Kingdom of Saudi Arabia are determined by the Saudi Arabian
Standards Organization (SASO). Exporters of these products
should comply (among other SASO standards) with Mandatory
Standards SSA 1/1984, whether for sample demonstration or
for commercial shipments, and must provide the following
certificates:
1. Food Manufacturer's Ingredients Certificate: This
certificate should include description of exported food products
(contents and percentage of each ingredient), chemical data,
microbiological standards, storage, and life of product (date of
manufacturing and date of expiration). When products contain
any animal fats, the certificate must confirm the kind of animal
from which it is taken, or state that no pork meat or its artificial
flavor nor its animal fat is being used. This certificate must be
obtained from your local health department and must be
signed.
2. Consumer Protection Certificate: This certificate must
confirm the healthiness of the various ingredients of the
exported food products to Saudi Arabia, their safety and fitness
for human consumption. This certificate must be obtained from
the local Authorities ( USDA- or one of its local offices if from
the USA ), and must be signed.
3. Price List: The price list should be issued by the exporter
on his letterhead, and should indicate that the prices of the
exported products to the Kingdom of Saudi Arabia are the
standard local market prices.
B. Meat Imported into Saudi Arabia
The Kingdom of Saudi Arabia imports only (male) beef or lamb
meats, fresh or frozen. In addition to the above-mentioned
shipping documents, all meat shipments must be accompanied
by the following certificates:
1) A certificate of "Halal" meat: This certificate indicates
that slaughtering has taken place in an officially licensed
slaughter-house and in accordance with Islamic "Shari'ah," i.e.,
procedures. The "Halal" meat certificate should be legalized by
a recognized Islamic Center in your country. It must also
accompany shipments of poultry into Saudi Arabia.
2) An Official Health Certificate: This certificate should
indicating the date of slaughtering, kind of animals and their
average age, in each shipment. The health certificate must also
indicate that animals were examined within twelve hours before
being slaughtered, and directly after, by a licensed veterinarian,
and were found free from disease and suitable for human
consumption.
Note: The HEALTH CERTIFICATE is required for all exports to
Saudi Arabia of all kinds of meat (including poultry and
seafood), meat products, livestock, vegetables, fruits, human
blood, etc., attesting that they are free from pests and/or
diseases.
Slaughtered animals must be stamped by the concerned health
authority on several parts. Age of animal, when slaughtered,
should not exceed three years for lamb and five years for beef.
Exporters should comply with prevailing Saudi rules and
regulations regarding the procedure of cutting, shipping,
storing, etc., of meat shipped to the Kingdom.
C. Importation of Seeds and Grains into Saudi Arabia
Exporters of seeds and grains must clearly write in Arabic and
English on each package or sack the following information:
Barley or Sorghum for animal Fodder:
1.
2.
3.
4.
5.
6.
Barley or Sorghum for animal fodder.
Name of exporter.
Weight of sack.
Country of production.
Date of production.
Expiration date.
Grains used as Seeds:
1.
2.
3.
4.
5.
6.
Barley, Sorghum, or wheat as seeds.
Name of exporter.
Country of production.
The Phrase: (Poisonous for both human
and/or animals), and sign of danger or
"skull and crossbones" must be shown in
red on each package or sack.
Date of production.
Expiration date.
In addition to shipping documents, the exporter of seeds or
grains must provide the following authenticated certificates:
1- Certificate of Inspection:
Issued by a specialized company for inspection of seeds. The
most important information the certificate must include are the
following:
* Name and address of buyer.
* Name and address of seller.
* Kind and amount.
* Seed Class.
* Name of shipping vessel.
* Type of packing.
* The written information on sacks, bags and each package.
* Results of inspection and percentage of germination, purity,
impurity, moisture, etc.
* Method of chemical treatment of the seeds.
* Confirmation that the seeds are free from insects, epidemic,
diseases and weed seeds (their number and species in a sample
of two kilograms must be mentioned).
2- Phytosanitary Certificate:
The purpose of this certificate is to verify that the seeds or
grains to be exported to the Kingdom of Saudi Arabia are free
from agricultural diseases. It is obtainable from the your
government Department of Agriculture (USDA- or from any of
its local offices if Seeds are from the USA). This certificate is
required to accompany all shipments of flour, rice, grains,
agricultural seeds, lumber, plants, plant material, etc.
3- Seed Analysis Certificate:
This certificate is to prove the degree of purity of the seeds
shipped to Saudi Arabia. It is issued by your government
Department of Agriculture ( USDA- or from any of its local
offices if Seeds are from the USA).
4- Certificate of Weight:
This certificate should be issued by the exporting company
indicating the name and address of the Saudi importer, the
name of the shipping vessel, the number of the bill of lading,
the number of seals and containers, and net weight and total
weight of shipment.
D. Animal Fodder Additive:
In addition to the above-detailed shipping documents, the
following certificates or documents are required:
1.
2.
3.
4.
Certificate of Free Sale.
Product Registration Certificate.
Certificate of Analysis.
Product Safety Data Sheet.
E. Shipment of Livestock to the Kingdom:
Besides the standard set of six shipping documents, the
following documents are required:
1. Certificate of Weight: This must show the average
2.
3.
4.
5.
6.
weight of the exported livestock.
Health Certificate: This must verify that the
livestock are free from diseases. It is issued by
your government Department of Agriculture (
USDA- or from any of its local offices if livestock
are from the USA).
Health Certificate issued by a veterinarian.
Pedigree Certificate issued by the local
government Department of Agriculture ( USDAor from any of its local offices if livestock are
from the USA).
Production records.
Declaration of Inspection and Acceptance.
F. Certificates Regarding the Shipment of Pets:
The additional required documents are the following:
1. A Health Certificate issued by a veterinarian and
2.
approved by the local government veterinarian
authority ( USDA- or from any of its local offices
if Pets are from the USA) confirming that the
animals are free from diseases. and provide
Animal Vaccination Certificate.
Only guard, hunting, and seeing-eye dogs are
allowed into Saudi Arabia.
G. Importation of Horses to the Kingdom:
The Saudi importer should submit an application to the
President of the Saudi Equestrian Club, indicating the number
of horses, exporting country, and customs center at the port of
entry to the Kingdom. The application should be accompanied
by the following documents:
1. A certificate of origin, issued by the company
2.
raising and breeding the horses, with a color
picture of each horse affixed to it. The certificate
must be authorized by the local government
veterinarian authority ( USDA- or from any of its
local offices if horses are from the USA),
Department of State and approved by a Saudi
Arabian Consulate.
A Health certificate, confirming that the horses
are free from diseases, approved by a
veterinarian and authenticated as in (1) above. It
should be noted, however, that only Saudis are
allowed to import horses into the Kingdom.
H. Vegetable and Fruit Health Certificate:
This certificate must accompany all shipments of vegetables
and fruits to the Kingdom certifying that such exports are free
from pests, insects, and other agricultural diseases, and that
they have not been exposed to ionizing radiation (but can be
treated with aluminum phosphate). This certificate can be
obtained from the government Department of Agriculture (
USDA- or from any of its local offices if vegetables and or fruits
are from the USA).
I. Certificate of Free Sale:
This certificate should accompany all shipments of
pharmaceutical and medicinal products to Saudi Arabia. It is
obtainable from your government Department of Health and
Human Services and should be presented to a Saudi Arabian
Consulate with other documents.
Moreover, imports of pharmaceuticals and medicinal products
require a certificate issued by your government Department of
Health and Human Services. This certificate must state that the
medicines are actually used by the public in your country under
the same trade name and formula and must include the name
of each product, the formula, and the date and number of the
permit to manufacture them if one is required. The certificate
must be certified by the Department of State in your country,
and be authenticated by a Saudi Arabian Consulate. This
certificate must be filed with the Ministry of Health in Riyadh,
Saudi Arabia, prior to any shipment of pharmaceutical or
medicinal products to Saudi Arabia, and must be renewed every
two years (see registration of medicines and pharmaceutical
products below).
J. SASO Certificates of conformity for imported electrical
appliances, equipment, a and accessories into Saudi
Arabia:
There are two types of certificates:
a) Certificate of Conformity for electrical appliances and
equipment.
b) Certificate of Conformity for electrical accessories.
The relevant certificate (the standard form is available at any
Saudi consulate) must be issued by the manufacturer on their
official letterhead, notarized by a notary public, certified by a
local chamber of commerce, and then sent to SASO in Riyadh,
Saudi Arabia ( address) at least two months before shipment
date, to be verified. Upon approval, the certificate will be
returned to the manufacturing company which must attach a
stamped copy with each shipment to Saudi Arabia of the
commodity mentioned therein. These certificates are only
required for commodities mentioned in the List of Imported
Electrical Products issued by SASO.
K. SASO Motor Vehicles Conformity Certificates:
Three months at least before dispatching the first consignment
of any type of motor vehicles in any year, the manufacturer
must send to SASO this certificate in English or Arabic for their
approval. Individuals must obtain this certificate from the
manufacturer prior to the shipment of any car for their personal
use in the Kingdom (a personal used car of a Saudi student or
diplomat is exempted).
ARRANGEMENT OF SHIPPING DOCUMENTS:
Shipping documents must be presented to any of the Saudi
Arabian Consulates in the following manner or they will be
rejected:
1.
2.
3.
4.
5.
6.
7.
Commercial Invoice.
Certificate of Origin.
Insurance Certificate.
Bill of Lading (or airway bill).
Steamship (or airline company certificate).
Packing List.
Special documents.
all stapled together.
In addition, for shipment from the USA an Export
Information Sheet, EIS (available at any U.S.-Arab Chamber
of Commerce) must be filled out, signed by an official of the
exporting or shipping company and presented to a Saudi
Arabian consulate along with the rest of the required shipping
documents. The EIS does not require authentication.
COMMERCIAL LEGAL DOCUMENTS:
All companies' documents, i.e. joint venture agreements,
commercial agency agreements, collaboration agreements,
authorization by proxy, etc., must be legalized in the following
manner:
1. Notarized by a Notary Public.
2. Certified by the County Clerk of the respective county
where the Notary Public is commissioned.
3. Certified under the seal of the Office of the Secretary of
the State where the documents originated.
4. Authenticated by the Authentication Office of the your
5.
country Department of State
Legalized by one of the Royal Saudi Consulates in the in
your country documents detailed above for fees and
procedures.
IMPORTS
GENERAL NOTES
GENERAL NOTES:



Imports of plants, fruits, vegetables, seeds, live animals
and poultry must have the prior approval of the
appropriate Saudi Arabian authorities and must be
accompanied by a phytosanitary or health certificate
stating that they are free from pests and other diseases.
All shipments of plants will be inspected upon arrival in
Saudi Arabia.
Shipment of hazardous materials must have the prior
approval of the Ministry of Interior in Riyadh, Saudi
Arabia.
According to Royal Decree No. 5/E/27748 dated
24/11/1402 H. (corresponding to September 12, 1982),
the country of origin must be mentioned on all products
imported into Saudi Arabia, except when it is not
feasible, as in the following list of examples:
(a) Small spare parts, nails, pins, nuts, etc. In this case, the
country of origin should be mentioned on the package or box.
(B) Barbed wires, metal sheets, unfinished boards of glass,
wood, marble, etc. In this case, the country of origin should be
mentioned on the band.
(C) Raw materials or semi-finished products used as an input
by national industries.

Carpet manufacturers and suppliers must indicate in
Arabic the following data which is to be applied on each
5 meters along the carpet roll length:
(A) Thickness or weight of each square meter.
(B) Pile weight.
(C) Country of Origin.
(D) Type: Indicate whether made of nylon, wool, acrylic
or polypropylene.
All carpet manufacturers, suppliers and distributors have to
show the captioned data on the sales invoice.


Shaving brushes and other articles made of raw hair
should be accompanied by a recognized official
certificate showing the consignment to be free from
anthrax germs.
Importing used clothing requires an official disinfections
certificate. These goods will be subject to inspection by
the Saudi Arabian quarantine officials.






Islamic Law strictly forbid the importation, sale and use
of pork and its products, liquor and narcotics.
Saudi laws forbid the importation of firearms. Arms for
hunting and similar sports arms need special permission.
Books, publications, audio and video materials are
subject to inspection and approval by customs for entry
into the Kingdom. In particular, obscene literature and
Communist propaganda will not be allowed entry.
Medical drugs for personal use in small quantities are
allowed. Travelers should be ready to show the
inspectors the necessary documents to identify the
drugs and the medical documents (e.g. doctor's
prescription) to prove that the medicine is for personal
use.
Non-commercial shipments of less than 10,000 Saudi
Riyals (about $2,600) and cars imported into the
Kingdom for personal use, regardless of their value, do
not require shipping documents.
Commercial samples are subject to the payment of
customs duty and surcharge either by a deposit equal to
the duty at the time of import or by a bank guarantee. A
refund is made if the goods are re-exported within 12
months. In the event of samples being sold, neither
deposit nor guarantee will be refunded.
Prior permission to import samples must be obtained
from the Director General of Customs, Customs
Department (see here for address), who should be
furnished with lists of samples, prices and catalogues. A
non-refundable duty of 12% is levied for imports of
samples of jewelry and watches. Authenticated shipping
documents are required for all shipments of commercial
samples