Categories
Ministerial Decision

Ministry of Energy: Decision 3664 Approving the Regulation of the Activities of Natural Gas and Its Liquids

Arabic

The Minister of Energy,

based on the powers entrusted to him by law,

and after perusal of article 11 of the Energy Supply Law issued by Royal Decree D/80 dated 4 Jumada Al-Thani 1444 [28 December 2022], which stipulates that “the Minister shall issue the regulations and the allocation regulation within a period not exceeding 60 days from the date of publication of the law in the official gazette,”

and in pursuance of public interest, hereby decides

First

The Regulation of the Activities of Natural Gas and Its Liquids is hereby approved in the form attached to this decision.

Second

The Regulation of the Activities of Natural Gas and Its Liquids must be published on the website of the ministry.

Third

This decision must be communicated to those who are required to implement it and act on it, in accordance with the provisions of the relevant orders, laws, regulations, instructions, policies, and procedures, and any further developments related to them.

May Allah provide success.

Minister of Energy
Abdulaziz bin Salman bin Abdulaziz

Issued on: 10 Ramadan 1446
Corresponding to: 10 March 2025

Published in Umm Al-Qura 5077 issued on 28 March 2025.

Categories
Laws and Regulations

The Regulation of the Activities of Natural Gas and Its Liquids

Arabic

Issued by Ministry of Energy Decision 3664

Based on article 11 of the Energy Supply Law issued by Royal Decree D/80 dated 4 Jumada Al-Thani 1444 [28 December 2022], which stipulates that: “The Minister shall issue the regulations and the allocation regulation,” and in accordance with the regulatory role of the ministry, this regulation aims to regulate the activities of natural gas and its liquids, and specify the conditions and requirements for obtaining licenses for these activities and the regulatory, technical, and procedural requirements that a licensee must comply with.

Chapter One
General Provisions

Article 1
Definitions

1․ Terms and phrases provided in this regulation have the meanings assigned in article 1 of the Energy Supply Law, unless a specific definition is provided for them in this regulation.

2․ ‏The following terms and phrases—wherever they appear in this regulation—have the meanings assigned to each of them, unless the context requires otherwise:

Regulation:
The Regulation of the Activities of Natural Gas and Its Liquids

Committee:
The committee for examining violations referred to in article 9 of the law.

International industry standards:
The specifications, practices, and procedures recognized in the energy industry internationally, under conditions and circumstances similar to those related to business in the Kingdom.

Person:
Any natural or legal person.

Third party:
A person benefiting or who may benefit from the activities of licensees, whether that beneficiary is a licensee, consumer, or others.

Applicant:
An applicant for a license to be issued, amended, extended, or disposed of.

Disposal of a licence:
The creation of rights over a license or transferring a license to another person by assigning, selling, or disposing of it in any other form.

Dry gas:
It mainly consists of methane, and may include some ethane and small amounts of heavier hydrocarbons and others. It is commonly referred to as sales gas.

Activity:
Any activity related to natural gas and its liquids that is subject to the law, including: Transportation, processing, fractionation, gas purification, collection, storage, local distribution, import, export, sale, and the construction, ownership, and operation of networks and facilities of natural gas and its liquids.

Facilities of natural gas and its liquids:
Any facility that is constructed, prepared, or equipped for the purpose of practicing one or more activities, including all installations and assets that are being constructed or converted to ensure the application of international industry standards, and any related fixed assets required for operational processes.

Transportation:
Delivering natural gas and its liquids—after compressing, liquefying, or regasifying them via pipelines, tanks, or other means—from a collection point to a delivery point.

Gas purification:
The removal of water, carbon dioxide, sulfur compounds, or any other impurities, elements, or compounds for the purpose of purifying gas, in gas plants or gas purification plants

Processing:
The separation of dry gas from natural gas liquids.

Fractionation:
The separation of ethane and other natural gas liquids into individual components, such as: Ethane, propane, butane, pentane, and heavier hydrocarbons.

Main gas network:
The currently existing main gas network, and any future expansion of it, which is an integrated network for transporting natural gas and its liquids, and distributing them to a third party and local distribution networks.

Collection and delivery points:
Points located at measurement meters, pipe junction connections (flanges), or others, which define the responsibility between one activity and another, one licensee and another, one facility and another, or a licensee and an end consumer.

Independent network:
An integrated network for transporting natural gas and its liquids, and distributing them to a third party and local distribution networks that are not connected to the main gas network.

Collection:
The collection of natural gas and its liquids from local producers or importers at the collection points of the main gas network for transportation and distribution purposes.

Sale:
The sale of natural gas and its liquids by local producers or importers to the main gas network or independent networks, in cases where the sale occurs at collection points.

Storage:
The receipt and keeping of natural gas and its liquids in designated facilities until they are delivered.

Local distribution:
Supplying consumers with natural gas and its liquids via a local distribution network, tanks, or any other means.

Liquefaction:
The process of converting gas from a gaseous state to a liquid state.

Regasification:
The conversion of liquefied gas from a liquid state to a gaseous state.

Local distribution network:
A network that receives natural gas and its liquids and delivers them to consumers, which requires the installation of a pipeline network, pressure reducing stations, and other facilities within a specific geographical area in a region or industrial city, and the delivery of gas to measurement meters of consumers under appropriate pressure.

Exclusive right to use:
The right of a licensee to use the full capacity of any facility of natural gas and its liquids for a specified period.

Capacity:
The handling ability of a facility of natural gas and its liquids.

Abandonment:
The relinquishment by a licensee of a specific facility for an activity of natural gas and its liquids.

Service commencement:
The date of releasing natural gas and its liquids into the facility.

Service fees:
The compensation received by a licensee from a third party for providing the service of transporting or locally distributing natural gas and its liquids.

3․ Terms and phrases provided in this regulation in the singular form denote the same meaning in plural forms and vice versa, if the text so requires.

Article 2
Scope

This regulation applies to activities related to natural gas and its liquids outlined in the law, excluding activities related to dry gas and liquefied petroleum gas that are subject to the Law of Dry Gas and Liquefied Petroleum Gas Distribution for Residential and Commercial Purposes.

Chapter Two
Activities and Licenses

Article 3
General Provisions

1․ The ministry may license more than one activity in a single license, and the ministry shall decide this on a case-by-case basis.

2․ All facilities of natural gas and its liquids where any aspect of the activity is practiced are subject to the provisions of the law and the regulation, whether these facilities exist independently or as part of other facilities. This includes shared assets required for operational processes.

3․ The procedures for accounting separation must determine the proportion of shared assets required by operational processes between activities subject to the law and others.

4․ Operation in the activity of constructing, owning, and operating networks and facilities of natural gas and its liquids is limited to the preparation of facilities of natural gas and its liquids for the practice of the activity, whether the preparation is for the licensee himself or for another licensee, and it is not intended for directly engaging in the activity related to the facility.

Article 4
Classification of Activities and Licenses of Natural Gas and Its Liquids

A person shall not practice the activity unless he obtains a license in accordance with the following schedule:

Paragraph Activity License type
(a) Constructing, owning, and operating networks and facilities of natural gas and its liquids Licensing the construction, ownership, and operation of networks and facilities of natural gas and its liquids
(b) Local distribution Local distribution license
(c) Transportation Transportation license
(d) Processing Processing license
(e) Fractionation Fractionation license
(f) Gas purification Gas purification license
(g) Collection Collection license
(h) Storage Storage license
(i) Import Import license
(j) Export Export license
(k) Sales Sales license

Article 5
Granting a License

1‏. Licensing for the activities of constructing, owning, and operating networks and facilities of natural gas and its liquids and local distribution, must be through qualification and floating a tender.

2․ ‏The ministry may directly license all aspects of the activity.

Article 6
General Requirements for Applying for a License

1․ ‏The requirements for applying for a license are as follows:

(a) Proof of technical ability and financial solvency to practice the activity.

(b) Design capacity, including, but not limited to: The total capacity of facilities of natural gas and its liquids, and the capacity available to a third party if required.

(c) Preliminary engineering design documents for the facility, showing the international industry standards followed, and the technical studies.

(d) Drawings and maps of facilities of natural gas and its liquids, showing the scope of the license with collection and delivery points.

(h) Satisfying the requirements of the relevant entities whose approvals or licenses issued by them are required to practice the activity, depending on the type of activity and geographical location. This includes, but is not limited to: Approval of the High Commission for Industrial Security, license from the Transport General Authority, and environmental license.

2․ ‏The Ministry may add some requirements in accordance with the nature of each license. This includes, but is not limited to:

(a) Submitting a service fee proposal, including all necessary information and calculations, and any additional information requested by the ministry in this regard.

(b) Justifications for requesting the exclusive right to use facilities of natural gas and its liquids.

3‏. An applicant may request the exclusive right to use—accompanied by justifications—and the ministry may grant this right in the license.

Article 7
Direct Licensing Application Evaluation Criteria

The ministry shall consider direct licensing applications based on the following criteria:

1․ Proof of technical ability and financial solvency to practice the activity.

2‏. Economic feasibility of the project related to the practice of the activity.

3‏. Avoiding the duplication of unwanted facilities of natural gas and its liquids.

4‏. Capacity available to a third party.

5․ Potential impact on competition.

6‏. Proximity of the proposed facilities of natural gas and its liquids to existing installations.

7․ Views and remarks of stakeholders when the announcement is published after the completion of the application requirements for license issuance.

Article 8
Qualification and Tender Floating Procedures

1․ The ministry may invite those wishing to obtain a license to construct, own, and operate networks and facilities of natural gas and its liquids or for local distribution, to take part in a tender in accordance with the following controls:

(a) The application for qualification must be submitted through the means and within the deadline specified by the ministry, by completing the approved form and providing the required documents, including, but not limited to:

(i) Proof of technical ability and financial solvency to practice the activity.

(ii) Administrative and technical expertise, financial systems, risk management policies and systems, technical resources, and operational procedures.

(b) ‏The ministry shall review the qualification applications, verify the satisfaction of the required documents, and conduct qualification to determine the qualified bidders.

(c) The ministry shall notify qualified bidders and announce this on its website.

2‏. The ministry shall send the tender document to the qualified bidders, and shall be open to receiving inquiries from all bidders and responding to them.

3․ The ministry may amend the tender document, reissue it, or cancel it as it sees fit.

4‏. Bidders shall submit their bids during the period specified in the tender document, and any bid submitted after the deadline for receiving bids must not be accepted.

5․ ‏The ministry shall examine the bids in accordance with the criteria stipulated in the tender document.

6․ ‏The ministry shall announce the winning applicant and inform him of that—in accordance with the notification methods specified in the tender document—in order to complete the licensing procedures.

Article 9
License Issuance Procedures

The procedures for issuing licenses of all types are as follows:

1․ The ministry shall review a license issuance application after the requirements provided in article 6 of this regulation have been satisfied. If they are not satisfied, the applicant must be given a period of 45 days to satisfy them.

2․ If the applicant is unable to satisfy the requirements within the specified period, the applicant shall provide the ministry with justifications for this or available alternative information within 10 working days. In this case, the ministry may take any of the following measures:

(a) Granting an additional period not exceeding 45 days to satisfy the requirements.

(b) Accepting the alternative information, and it may request the applicant to provide the required information in accordance with a date specified in the license.

(c) Rejecting the justifications for not providing the required information and considering the application cancelled, and the applicant must be notified of this.

3․ The ministry shall require the applicant, within 15 days from the date of notifying him of the satisfaction of the requirements, to publish an announcement as specified by the ministry,

which must include information about the license application, pipeline routing, and scope of activity. The ministry shall receive views and remarks on the license issuance application within 90 days from the date of publication of the announcement.

4‏. The ministry shall issue its decision to approve or reject the application, and the rejection must be reasoned. If approved, the ministry shall issue the license.

Article 10
License Fee

First: The fee for issuing, extending, or amending any license for an activity must be as follows:

(a) For issuing a new license, an amount of 20,000 Saudi Riyals.

(b) Extending or amending a license, an amount of 10,000 Saudi Riyals.

Second: The annual fee for licensing the construction, ownership, and operation of facilities of natural gas and its liquids must be as follows:

(a) The annual fee is calculated at a rate of 1/10,000 of the capital cost of the assets of the facilities of the activity annually from the date of service commencement.

(b) The annual fee must be paid in the year following the expired financial year, as determined by the ministry.

Article 11
License Document

A license document must—in accordance with the nature of each activity—include the following:

1‏. License duration.

2․ Duration of completing the facility and the start of its operation.

3‏. Terms on extending the license.

4‏. Terms on capacity.

5‏. Scope of the license.

6․ Conditions for canceling the license.

7․ Terms on the financial and accounting requirements for licensing and its conditions.

8‏. Terms on the transfer of physical assets of licensed activities.

9․ Abandonment of facilities of natural gas and its liquids.

10‏. Terms on reports and information requested by the ministry.

11‏. Insurance.

12․ Any other terms or conditions that the ministry deems necessary, in accordance with the nature of each license.

Article 12
Service Commencement

A licensee shall—after completing the construction works for the facilities of natural gas and its liquids—submit an application to obtain the approval of the ministry for service commencement by attaching the following requirements:

1‏. Certificate of completion of mechanical works.

2‏. Certificate of completion of preparatory works for operation.

3․ Any other requirements that the ministry deems necessary, in accordance with the nature of each license.

Article 13
License Duration

The license duration must not be less than 25 Gregorian years.

Article 14
License Extension

1․ A licensee wishing to extend the license shall submit an application within a period no less than 4 years and no more than 10 Gregorian years before the license expiration date.

2․ ‏The ministry shall implement the procedures for issuing licenses when extending a license, and the license extension duration must be at least 10 Gregorian years.

Article 15
License Amendment

1․ A licensee shall—before undertaking any amendment to the license—submit an application to amend the terms or scope of the license in order to obtain the required approval from the ministry.

2‏. The ministry may—after reviewing the application to amend the license—inform the licensee of the reimplementation of the license issuance procedures stipulated in article 9 of this regulation.

Article 16
Disposal of the License

1․ A licensee shall submit an application to dispose of the license in order to obtain the required approval from the ministry.

2‏. One of the forms of disposal of the license is the case of offering the licensed facility for public subscription.

3․ ‏The ministry shall decide on the application within a period not exceeding 60 days from the date of notification of the licensee that the application is complete.

4․ ‏The ministry shall issue its decision to approve or reject the disposal of a license, and the rejection must be reasoned.

Article 17
License Expiration

A license expires in any of the following cases:

1․ Expiry of the license duration.

2‏. Issuance of a decision by the committee to cancel the license.

3․ Approval by the minister of the request by the licensee to terminate the license.

4․ Distress or bankruptcy of the licensee.

Article 18
Procedures for Abandoning Facilities

1․ If a licensee does not wish to extend the license, he shall submit to the ministry at least three years before the license expires, an application to undertake abandonment procedures as follows:

(a) ‏The licensee shall submit a plan for abandonment of facilities of natural gas and its liquids for review and approval by the ministry at least three years before the license expiration date.

(b) The ministry shall review the plan submitted by the licensee to amend it if necessary and approve it. The ministry shall announce this on its website.

2․ ‏The ministry shall arrange with the licensee the procedures for transferring ownership of all physical assets to the state after the expiry of the license, unless the license stipulates otherwise.

Article 19
Scope of License

For each activity, the scope of licenses for activities is as follows:

1․ Scope of license for a local distribution network: From the collection point to the delivery points for a consumer within a specified geographic scope, including—but not limited to—the individual meters of each consumer.

2․ Scope of license for local distribution by tankers: From the collection point to the delivery points for a consumer within a specified geographic scope, including—but not limited to—the assets of gas compression or liquefaction stations, regasification stations, and tankers.

3‏. Scope of licence for transportation: Between the collection and delivery points for pipelines or transportation by tankers and others, and includes—but is not limited to—all the assets necessary to practice the activity, such as: Compressors, pumps, filters, and pressure reducing stations.

4‏. Scope of licence for transportation or collection in the main gas network or an independent network: From the collection points at gas processing plants, other producers, import terminals, or others, to the delivery points for a third party, and includes—but is not limited to—all assets necessary to practice the activity, such as: Compressors, pumps, filters, and pressure reducing stations.

5․ Scope of licence for export and import: From the collection point to the delivery point at the export and import facility, including—but not limited to—all assets necessary for the export and import of natural gas and its liquids, whether fixed or floating import and export terminals.

6․ Scope of license for purification, processing, and fractionation plants: Covers the entire perimeter of the plant to the delivery points in the main gas network, independent networks, or transportation pipelines. This includes—but is not limited to—all assets necessary to practice the activity, such as: Core operational assets and supporting assets for these operations, such as steam, compressed air, or water production facilities.

7․ Scope of license for storage: Within the boundaries of the assets of the storage facility, from the collection points to the delivery points for transportation pipelines and others, including—but not limited to—pumping, compression, and liquefaction stations as well as tanks.

8․ As an exception to the provisions of the preceding paragraphs of this article, the ministry may—in accordance with reasonable technical justifications—amend the scopes of the licenses for activities and stipulate the amended scope in the license.

Chapter
Three Obligations

Article 20
General Obligations

A licensee shall comply with the following:

1․ Fulfilling all necessary legal requirements in accordance with this regulation or those issued by the relevant entities.

2‏. That all works undertaken by him or through others, must be consistent with the provisions of the law, the regulation, and related laws.

3‏. Refraining from carrying out any act that restricts fair competition in any or part of the activities.

4‏. Periodic inspection of assets and pressure control systems and prevention of its increase.

5․ Carrying out all improvements, additions, and repairs to assets and replacing assets that have reached the end of their useful life, have been damaged, or have been proven unsafe by periodic inspection.

6‏. Security, safety, health, and environmental requirements and instructions issued by the relevant entities.

7‏. Insurance for employees against accidents and occupational hazards, and against losses and damages to facilities of natural gas and its liquids, according to the requirements of the relevant entities, throughout the license duration.

8‏. Restoring facilities of natural gas and its liquids, if damaged, to operate at their full capacity within the period specified by the ministry.

9․ Implementing the financial and accounting standards issued by the relevant entities, and the standards determined by the ministry for calculating the annual fee and service fees.

10․ Inventorying assets, preparing a list of them, and having it approved by an external auditor according to the relevant laws; submitting it to the ministry before service commencement; and updating the list annually by adding new assets or written-off assets, and submitting it to the ministry

11․ Keeping reports, records, technical and accounting information, and the like for a period of five years after the license expires.

12․ Studying future needs for facilities of natural gas and its liquids based on expected changes in supply and demand, and formulating future plans for the exploitation, expansion, and development of these facilities.

13․ Notifying the ministry of any temporary changes to the capacity specified in the license document, the reasons for the change, and the timeframe within which the change continues.

14․ Providing the service to a third party in accordance with the obligations agreed upon in the contractual relationship between the parties, if required.

15․ Providing a service for receiving complaints, announcing this service, and responding to them quickly, if required.

Article 21
Obligations of Local Distribution Activity

A local distribution activity licensee shall comply with the following:

1‏. Providing control means, metering systems for consumers and facilities, and the services necessary to provide the service.

2․ Providing technical drawings and information and coordinates for the network and any expansion to it, and keeping them for the license duration.

3‏. Selling gas to a consumer in accordance with the approved tariff specified by the state, with the service fees specified in the license added to it.

4․ ‏Obtaining the prior approval of the ministry before performing the service for any new gas connection requests.

5‏. Submitting an annual report to the ministry, including market expansion plans and investment plans, to obtain its approval.

6‏. Preparing the forms of contracts and agreements with third parties in accordance with the requirements of the ministry.

Article 21
Obligations of Gas Transportation Activity

1․ ‏A gas transportation activity licensee shall comply with the following:

(a) Obtaining the required approvals—in accordance with the relevant laws—for pipe routes and their protection.

(b) Providing additional capacity to a third party.

(c) Including the assets of branch pipelines in the license when the licensee constructs them to provide services to a third party, and excluding from the license the branch pipelines constructed by a third party.

(d) Preparing the forms of contracts and agreements with third parties in accordance with the requirements of the ministry.

2․ A licensee for gas transportation activity in the main gas network shall obtain a license for the collection activity when receiving natural gas and its liquids from local producers or importers.

Article 23
Obligations of Collection and Sale of Natural Gas and Its Liquids Activities

A collection and sale of natural gas and its liquids activities licensee shall comply with the following:

1․ The scope of collection must be identical to the scope of the main gas network.

2․ The collection or sale agreements must specify responsibilities, terms, and conditions.

Article 24
Obligations of Purification, Processing, and Fractionation Activities

A purification, processing, or fractionation activities licensee shall submit periodic reports to the ministry as specified in the license, including, but not limited to: The specifications of natural gas and its liquids, quantities, seasonal and monthly variations, maintenance downtime forecasts, emissions reports, and production plans for the next five years.

Article 25
Obligations of Storage Activity

A storage activity licensee shall submit periodic reports to the ministry as specified in the license, including, but not limited to: Capacities, stored quantities, flow rates, and seasonal and monthly variations.

Article 26
Regulation of the Contractual Relationship

1․ A licensee shall sign agreements and contractual relationships with a third party in accordance with the requirements and forms issued by the ministry.

2․ A licensee shall provide the ministry with the documents and papers it requests for the purpose of regulating agreements and contractual relationships between licensees, or a licensee with a third party, for approval, including, but not limited to:

(a) Contracts with customers and third parties for the sale of natural gas and its liquids.

(b) Supply, lease, operation, and maintenance agreements.

(c) Agreements governing the design and engineering conditions between licensees when constructing facilities of natural gas and its liquids.

(d) Contracts with producers or suppliers for the purchase of natural gas and its liquids.

Article 27
Capacity of Facilities

1․ A licensee shall, if he wishes to increase the capacity of a facility of natural gas and its liquids, submit an application to the ministry to amend the license.

2․ ‏The ministry has the right to amend the capacity of any facility of natural and its liquids in a manner that achieves the objectives of the law, the regulation, and the public interest, and to stipulate the amended capacity in the license.

Article 28
Exclusive Right to Use Capacity

1‏. A licensee in a facility for natural gas and its liquids may submit an application to the ministry to allow him to exclusively use the capacity of that facility for a specified period, and the ministry may grant that right, and the ministry shall determine the conditions in the license document after its amendment.

2․ If a licensee at any time during the exclusive right to use duration enters into a contract to grant the right to use the capacity to a third party—without the approval of the ministry—then the exclusive right to use for the entire capacity of the facility of natural gas and its liquids is invalid, and all other provisions stipulated in this regulation regarding the right to use capacity by a third party apply.

Article 29
Right to Use Capacity

1․ If a third party submits a request to a licensee for the right to use capacity, the licensee shall provide it within the limits of the unused capacity of the facility that is not subject to the exclusive right to use. The ministry may require a licensee to provide the right to use capacity to a third party.

2․ A licensee shall apply to the ministry to obtain its approval within ten days from the date of receiving the request of a third party.

3․ The third party is subject to the terms and conditions applicable to the use of capacity by the licensee.

Article 30
Capacity Increase for a Third Party

If a third party requests from a licensee the right to use capacity, and this is not possible due to its unavailability, the third party may submit a request to the licensee to increase the capacity in accordance with the following controls:

1‏. The third party shall submit its request to the licensee, and the licensee shall respond to the request within 45 days with approval or rejection, and it must be reasoned.

2․ Upon approval by the licensee, he shall submit an initial proposal for service fees and the service commencement date, as well as a license amendment application to the ministry.

3․ Upon rejection by the licensee, the third party may submit the request to the ministry for review. The ministry may request the views of both the licensee and the third party within a period determined by the ministry, provided that the views of both parties regarding increasing the capacity of the facility are explained in detail.

4․ The ministry may set the service fees and the appropriate terms and conditions for expanding the facility and require the licensee to increase the capacity of the facility and notify the third party of this. The licensee shall submit to the ministry within 25 days a license amendment application that includes all the basic details related to the capacity increase.

5․ If the ministry determines‏—in accordance with the public interest—that there is no need to increase the capacity, then the licensee and the third party must be notified of the decision.

Article 31
Service Fees and Procedures for Reviewing Them

1․ ‏The ministry shall set the service fees and the terms and conditions applicable to them.

2‏. Service fees become applicable upon service commencement at facilities of natural gas and its liquids.

3․ Any activities that do not include an exclusive right to use must have service fees set by the ministry when requested by a third party.

4‏. The ministry shall specify the application period of the approved service fees, which must not exceed five years. It is permitted to review and amend service fees in the following cases:

(a) Submitting to the ministry an application to amend the service fees at any time after two years have passed since the start of the application of the service fees, and if the ministry decides to amend them, the ministry shall issue the service fees in accordance with paragraph 1 of this article.

(b) ‏The ministry may review the service fees if it deems it necessary to review them, and if the ministry decides to amend them, the ministry shall issue the service fees in accordance with paragraph 1 of this article.

(c) ‏The ministry shall review and reissue service fees when the license is amended or extended.

5․ Without prejudice to the provisions of paragraph 4(a) of this article, the licensee shall submit an application to review the service fees within a period of 130 days before the expiry of the application of the existing service fees.

6․ It is not permitted to make adjustments to the fee calculation to compensate for revenue shortfalls during previous fee periods resulting from mismanagement by the licensee.

7․ ‏The ministry may issue rules and procedures that determine the mechanism for calculating, reviewing, and setting service fees, as well as the financial and accounting standards in this regard.

Article 32
Review of Service Fees

The ministry shall review service fees as follows:

(a) ‏The ministry shall notify the licensee of the commencement of the service fee review procedures.

(b) ‏The licensee shall provide all investment, financing, operational, financial, and supporting information, and any other additional information requested by the ministry within 25 days from the date of commencement of the service fee review.

(c) ‏The licensee shall publish the announcement of the commencement of service fee review by the ministry in the medium specified by the ministry according to the relevant laws, within ten working days of the completion of the above information and its approval by the ministry, and proof of its publication to the ministry must be submitted.

(d) ‏The ministry shall review the information provided in paragraph (b) of this article and the views of the stakeholders, set the prescribed service fees, and notify the licensee to begin applying them.

Article 33
Accounting Separation Procedures

A licensee shall comply with the following:

1‏. Preparing accounts and reports for each activity separately.

2․ Submitting the audited annual financial statements to the ministry within a period not exceeding six months from the end of the financial year.

3‏. Separating costs and revenues associated with the aspects of the activity stipulated in the license from other activities not subject to the law, and providing the ministry with accounting separation documents.

4‏. Principles and grounds of separating costs and revenues and submitting accounting separation documents, including:

(a) That the accounting separation information is consistent with the audited financial statements subject to the relevant laws in the Kingdom, and that it is reconciled with those statements, and supporting information and explanations for that reconciliation must be provided.

(b) That the accounting separation information is adequately supported by evidence, documents, and methodologies, in a manner that enables an internal or external auditor to trace its source and review it.

(c) That the allocation process for costs, revenues, and assets shared between activities subject and not subject to the law is based on the actual driver of the cost or revenue, unless the ministry decides otherwise. Allocation mechanisms must also be clear and consistent in the allocation process.

(d) That the accounting methodologies, principles, and standards used in the preparation of the accounting separation are consistent annually, unless there is a logical explanation and clarification of the reasons for the change and modifications, with the submission of supporting justifications and documents for those changes.

(e) Ensuring the transparency and clarity of reconciliation between internal databases, reports, and statements related to the accounting separation process.

(f) That the accounts, allocation processes, and other information used in the accounting separation system are based on verifiable data.

(g) Preparing the accounting separation data in a way that ensures that it does not have a material impact on any regulatory decisions.

(h) That the information must be detailed, accurate, and free of errors.

(i) That the senior executive management of the licensee is responsible for the quality and accuracy of the information provided to the ministry related to accounting separation.

(j) That the accounts, reports, and information are clear, traceable, and easy to understand, and when submitted, they must be in unrestricted formats and use standard software and data processing tools.

5․ The accounting separation documents must include at least the following:

(a) Accounting separation guide: A guide that clarifies all the methodologies, principles, and procedures that the licensee will follow, and it must include the following:

(i) Design and structure of the accounting separation system.

(ii) Cost and revenue allocation criteria.

(iii) Description of the cost and revenue accounts list of the licensee.

(iv) Principles and methodology of asset revaluation.

(b) Accounting separation results: The outputs of the accounting separation process, in accordance with the accounting separation guide, must include the following:

(i) Actual results of the accounting separation process.

(ii) Income statement, financial position, and cash flows for the licensed activity.

(iii) Financial indicators, for example, return on investment, return on assets, working capital, weighted average cost of capital (WACC), and profit margins.

(iv) Reconciliation statement between accounting separation and audited financial statements.

(v) Cost and revenue allocation matrices.

(vi) Information about assets, including a fixed assets register that covers the historical value of assets, accumulated depreciation, and assets added and discarded.

(vii) Information about sales quantities.

(viii) Acknowledgment of output accuracy and senior management responsibility of the licensee.

(c) Supporting studies: They must provide additional technical and standard details about certain cost allocation standards in the accounting separation system.

6‏. A licensee shall submit the accounting separation documents annually to the ministry within a deadline not exceeding six months after the end of each financial year, as follows:

(a) An electronic copy of the accounting separation documents in both Microsoft Excel and Microsoft Word formats, as required by the nature of each item of the accounting separation results detailed above. These files must be unprotected, and it must be possible to track, amend, and review the information.

(b) A signed electronic copy of the management responsibility statement in PDF format.

(c) An electronic copy of the audited financial statements for the relevant financial year.

7․ A licensee shall obtain the approval of the ministry before commencing the asset revaluation procedures.

8․ A licensee shall, at its own expense, appoint an accredited external auditor to audit, review, and approve the accounting separation documents and submit the necessary reports regarding the audit and review process to the ministry, accompanied by recommendations and an opinion on the accounting separation documents.

9․ ‏The ministry may audit the accuracy and objectivity of the accounting separation in light of relevant information and documents, and if there are any observations or requirements that require amendments by the licensee, the ministry shall notify the licensee of those observations in the form and format it specifies. The licensee shall comply with those requirements and required amendments within the period specified by the ministry.

Article 34
Standards

1․ A licensee shall comply with international industry standards in the design, construction, operation, maintenance, and inspection of facilities of natural gas and its liquids, the tanks used in local transportation and distribution operations, and facilities financed or constructed by third parties that become an integral part of his existing facility, in accordance with the specifications, standards, and requirements prescribed by the relevant laws.

2․ The ministry may issue technical and operational controls and requirements that include specifications, standards, and sound practices related to activities of facilities of natural gas and its liquids, in coordination with the relevant entities.

Article 35
Reports

1‏. A licensee shall provide the ministry—periodically—with reports of information prepared by the ministry necessary to implement the law, including, but not limited to:

(a) A statement of the quantities of natural gas and its liquids purchased or sold.

(b) A statement of the quantities of natural gas and its liquids that are being transported, processed, purified, fractionated, stored, collected, or distributed.

(c) Disclosure of contracts entered into in relation to the provision of services.

(d) Disclosure of any changes in capacity.

(e) Accident and security statistics.

(f) Performance and emissions.

(g) Any other requests that the ministry deems appropriate to detail.

2․ A licensee shall submit annual reports to the ministry within six months after the end of each Gregorian year, containing the following information:

(a) A statement of the annual total of reports stipulated in paragraph 1 of this article, detailed by month.

(b) Final accounts for the completed financial year, audited and reviewed by an accredited external auditor in accordance with relevant laws, and an updated asset inventory register approved by an external auditor.

(c) Forecasts of supply and demand for natural gas and its liquids for the next five years.

(d) Forecasts for downtime, maintenance, or capacity changes for the next three years.

(e) The expected operational life of facilities of natural gas and its liquids, provided that this is during the operating period.

3․ A licensee shall, for the purpose of preparing the reports required to be submitted to the ministry, classify accounts related to activities subject to the law and separate them from other accounts related to activities not subject to the law, and shall keep its accounting records in a manner that ensures the clarity of this.

4․ ‏If the ministry finds that a licensee has information that the ministry deems required for the implementation of the law, he shall provide this required information in accordance with the mechanism and period specified by the ministry in its request.

5․ If a licensee is unable to provide the information within the period specified by the ministry, or is unable to provide it in accordance with the mechanism specified by the ministry, he shall submit the justifications for this and alternative available information to the ministry within (10) working days. In this case, the ministry may take any of the following actions:

(a) Accepting the alternative information, and the ministry may require the licensee to provide the required information on a date to be determined later.

(b) Rejecting the justifications for the failure to provide the required information, and requiring the licensee to provide it within a specified period or any other additional period determined by the ministry. Failure to provide the information constitutes a violation of the provisions of this regulation.

6․ A licensee shall ensure the accuracy and correctness of the information when submitting it to the ministry.

7․ A licensee shall immediately inform the ministry of any update or material change to his business.

Article 36
Assigning Certain Inspection Tasks

1․ The ministry shall conduct audits, inspections, and examinations of the sites of the licensee during the official working hours of the licensee to ensure compliance with the provisions of the law, the regulation, and license conditions.

2‏. A licensee shall enable inspectors to view all documents related to the activity.

3․ A licensee shall provide all information requested by the ministry for the purpose of review and inspection.

4․ ‏The minister may assign certain inspection and violation policing tasks to the private sector, provided that the assignment takes into account the following controls and standards:

(a) Fulfilling the legal requirements specified by the ministry.

(b) Disclosing any conflict of interest, even if it is a potential one.

(c) Adhering to confidentiality and undertaking not to disclose any information that it has viewed, even after the inspection tasks have been completed and the violations have been captured.

(d) Satisfying the technical expertise and financial capabilities necessary to carry out tasks of inspection and policing violations.

(e) Complying with the conditions, specifications, standards, criteria, and technical practices in accordance with the relevant laws.

(f) Complying with the inspection and violation policing mechanism determined by the ministry, including the requirement for prior coordination with the ministry before inspection.

Article 37
Environment, Health, Safety, and Emergency Response

1․ A licensee shall comply with the following:

(a) Security, safety, health, and environmental requirements and instructions issued by the relevant entities, which are competent with—including, but not limited to—the following:

(i) Work environment.

(ii) The assets of the facilities, equipment, and materials used in the work of all employees.

(iii) Occupational safety laws and practices.

(iv) Identifying, evaluating, and documenting all risks associated with the practice of activities.

(v) Emergency response plans.

(vi) Occupational health and safety procedures.

(vii) Design, construction, and operation of facilities of natural gas and its liquids, in a manner that ensures environmental protection and maintains the safety and health of employees and the public, as well as the integrity of physical assets throughout the operational life of these facilities.

(b) Immediately informing the ministry of any accidents or leaks in accordance with the mechanism determined by the ministry, investigate them, prepare relevant reports, and keep them for a period of not less than five years.

2․ A licensee shall prepare an emergency plan in accordance with the instructions of the relevant entities, and develop a comprehensive emergency response plan that outlines all necessary response procedures and the stages followed to mitigate the impacts on the environment, health, safety, and security, and a plan for recovery from these impacts. The following—at a minimum—must be complied with:

(a) Reviewing and updating it regularly.

(b) Developing, implementing, and practicing emergency scenarios to test them in coordination with the ministry, relevant entities, other licensees, and third parties.

(c) Qualifying and training the personnel and employees of the licensee.

(d) Procedures for notifying the relevant entities, and their contact numbers.

Chapter Four
Final Provisions

Article 38
Entry into Force of the Regulation

The provisions of this regulation enter into force from the date of their publication on the website of the ministry.


Published in Umm Al-Qura 5077 issued on 28 March 2025.

Categories
Ministerial Decision

Transport General Authority: Decision 155/46/1 Approving the Schedule of the Classification of Foreign Trucks Violations

Arabic

based on the powers granted to him by law,

after perusal of Royal Decree D/188 dated 24 Sha’ban 1446 [23 February 2025],

after perusal of the Law of Carriage by Land on Roads issued by Royal Decree D/188 dated 24 Sha’ban 1446 [23 February 2025],

after perusal of Council of Ministers Decision 614 dated 19 Sha’ban 1446 [18 February 2025],

and after perusal of the System of the Transport General Authority issued by Council of Ministers Decision 323 dated 14 Ramadan 1434 [22 July 2013] and its amendments,

and in pursuance of public interest,

hereby decides

First

The Schedule of the Classification of Foreign Trucks Violations is hereby approved in accordance with the form attached to this decision.

Second

This decision must be published in the official gazette, and comes into force on the date of its publication.

Third

The original copy of this decision must be sent to the undersecretary of the authority for land transport to notify those who are required to implement its provisions.

May Allah provide success.

Acting President of the Transport General Authority
Rumaih bin Mohammed Al-Rumaih

Issued on: 8 Ramadan 1446
Corresponding to: 8 March 2025

Published in Umm Al-Qura 5075 issued on 14 March 2025.

Categories
Laws and Regulations

The Schedule of the Classification of Foreign Trucks Violations

Arabic

Issued by Transport General Authority Decision 155/46/1


 

No Description of the Violation Classification of the Violation Warning Period Punishment The punishment if the violation is repeated within one year from the date of committing the last violation
First time Second time Third time Fourth time[1]
1 Practising transportation by a foreign truck within the Kingdom of Saudi Arabia[2] Grievous Not applicable 10,000 Riyals 20,000 Riyals 40,000 Riyals 80,000 Riyals 160,000 Riyals
With impounding the vehicle for a period of 15 days With impounding the vehicle for a period of 30 days With impounding the vehicle for a period of 60 days With impounding the vehicle for a period of 60 days With impounding the vehicle for a period of 60 days

 

[1]The fine continues to double after the fourth time.

[2] The committee formed by virtue of the Law of Carriage by Land on Roads may request the competent court to rule to confiscate the truck in the event of a violation for the fifth time or after it, in accordance with article 25(7) of the law.


Published in Umm Al-Qura 5075 issued on 14 March 2025.

Categories
Council of Ministers Decision

Council of Ministers: Decision 656 Transforming the National Committee for the Saudi Building Code into a Center Name the Saudi Building Code Center

Arabic

The Council of Ministers,

after perusal of Royal Court File 34325 dated 12 Jumada Al-Awwal 1446 [14 November 2024] regarding the draft Organizational Arrangements of the Saudi Building Code Center,

after perusal of the mentioned draft organizational arrangements,

after perusal of the Law for Implementing the Saudi Building Code issued by Royal Decree D/43 dated 26 Rabi Al-Thani 1438 [24 January 2017],

after perusal of the General Plan of the National Committee for the Saudi Building Code issued by Council of Ministers Decision 174 dated 15 Jumada Al-Thani 1422 [3 September 2001],

after perusal of the Council of Ministers Decision 127 dated 20 Rabi Al-Thani 1431 [5 April 2010] and Council of Ministers Decision 459 dated 2 Dhu Al-Qa’dah 1436 [17 August 2015],

after perusal of Bureau of Experts at the Council of Ministers Memorandum 3144 dated 29 Sha’ban 1445 [10 March 2024], Memorandum 4024 dated 22 Dhu Al-Qa’dah 1445 [30 May 2024], Memorandum 293 dated 18 Muharram 1446 [24 July 2024], Memorandum 2046 dated 10 Jumada Al-Thani 1446 [11 December 2024], and Memorandum 2548 dated 14 Rajab 1446 [14 January 2025],

after perusal of Council of Economic and Development Affairs Minutes 1703/45/M dated 11 Ramadan 1445 [21 March 2024],

after considering Shura Council Decision 70/7 dated 26 Rabi Al-Thani 1446 [29 October 2024],

and after perusal of General Committee of the Council of Ministers Recommendation 8418 dated 20 Sha’ban 1446 [19 February 2025],

hereby decides

First

The National Committee for the Saudi Building Code is hereby transformed into a center named the “Saudi Building Code Center.”

Second

The Organizational Arrangements of the Saudi Building Code Center are hereby approved in the form attached.

Third

As an exception to the provisions of article 11(2) of the arrangements referred to in clause Second of this decision, the first fiscal year of the center begins from the date of entry into force of its arrangements and ends at the end of the next fiscal year of the state.

Fourth

The establishment of the Saudi Building Code Academy—in principle—is hereby approved, and the center shall submit its findings to complete the necessary procedures in this regard.

Fifth

The Board of Directors of the Saudi Building Code Center shall exercise its powers stipulated in article 6(5) of the organizational arrangements stipulated in clause Second of this decision, in agreement with the Ministry of Finance and the Center for the Development of Non-Oil Revenues, until the issuance and entry into force of the Governance of the Practice of Imposing the Fee for Services and Works Provided by Entities That Have the Legal Authority to Impose a Fee.

Sixth

The Law for Implementing the Saudi Building Code issued by Royal Decree D/43 dated 26 Rabi Al-Thani 1438 [24 January 2017] is hereby amended as follows:

1․ Amending the definition of “National Committee” provided in article 1 to read as follows:

Center:
The Saudi Building Code Center.

2․ Amending article 4 to read as follows:

Amendments to the code must be issued by a decision of the Minister of Municipalities and Housing.

3‏. Amending the phrase “Minister of Commerce, Chairman of the Board of Directors of the Saudi Standards, Metrology, and Quality Organization” stipulated in article 5 to read as follows:

The Minister of Municipalities and Housing.

4․ Amending the phrase “The National Committee is considered” to become “The center is considered”, and the phrase “Minister of Commerce, Chairman of the Board of Directors of the Saudi Standards, Metrology, and Quality Organization” to become “Minister of Municipalities and Housing” in article 15.

Seventh

A committee must be formed in the Ministry of Municipalities and Housing, with the membership of two representatives from: The Ministry of Finance and the Ministry of Human Resources and Social Development, and from the Saudi Standards, Metrology, and Quality Organization, to take the necessary measures regarding the following:

1․ Transferring employees concerned with the activities of the National Committee for the Saudi Building Code referred to in clause First of this decision and the vacant and occupied positions to the Saudi Building Code Center, in accordance with the Rules and Arrangements for the Treatment of Employees and Workers in the Sectors Targeted for Transformation and Privatization issued by Council of Ministers Decision 616 dated 20 Shawwal 1442 [1 June 2021].

2․ Transferring the properties, documents, and financial allocations relating to the activities of the National Committee for the Saudi Building Code from the Saudi Standards, Metrology, and Quality Organization to the Saudi Building Code Center referred to in clause First of this decision.

Eighth

The Board of Directors of the Saudi Building Code Center shall prepare a draft system for the center in light of the provisions of the organizational arrangements—stipulated in clause Second of this decision—and whatever it may become cognizant of in this regard, and it must be submitted within a period not exceeding 12 months from the date of approval of the organizational arrangements referred to in clause Second of this decision, to complete the necessary legal procedures.

A draft royal decree has been prepared regarding clause Sixth(1) and (4) of this decision in the form attached.

The Prime Minister

Issued on: 4 Ramadan 1446
Corresponding to: 4 March 2025

Published in Umm Al-Qura 5077 issued on 28 March 2025.

Categories
Laws and Regulations

The Governance Framework for the Saudi Building Code Center

Arabic

Issued by Council of Ministers: Decision 656 


Article 1

The following words and phrases—wherever they appear in these arrangements—have the meanings assigned to each of them:

Center:
The Saudi Building Code Center.

Arrangements:
The Organizational Arrangements of the Saudi Building Code Center.

Minister:
The Minister of Municipalities and Housing.

Board:
The board of directors of the center.

Chairman:
The chairman of the board.

Chief executive officer:
The chief executive officer of the center.

Code:
The Saudi Building Code.

Article 2

1․ The center enjoys legal personality and financial and administrative independence, and is legally affiliated with the minister.

2․ The headquarters of the center must be in the city of Riyadh, and it may establish branches and offices within the Kingdom as needed.

Article 3

The center aims to review, update, and develop technical, scientific, and administrative systems specialized for buildings and installations built on scientific foundations that are compatible with engineering principles, properties of materials, and natural conditions and hazards, as well as to improve the quality, stability, and sustainability of buildings, by identifying, analyzing, and studying the obstacles and challenges facing the public and private sectors in implementing the Saudi Building Code and practicing professional work that is compatible with the environment and conditions of the Kingdom. This is done in order to protect lives and property and preserve the national economy.

Article 4

Without prejudice to the mandates and responsibilities of other government entities, the center shall, in order to achieve its objectives, undertake the necessary tasks and mandates that serve the purposes for which it is established, including the following:

1․ Proposing draft laws and regulations relating to the fields of its mandates, and proposing amendments to those in force, in coordination with the relevant entities, and reporting on this in accordance with the established legal procedures.

2․ Setting policies, plans, programs, and initiatives in the fields of its mandates, and reporting on matters that require the completion of legal procedures in their regard.

3․ Setting standards, procedures, and forms in the fields of its mandates.

4․ Setting the necessary controls and requirements for the licenses issued by the center relating to activities associated with the fields of its mandates.

5․ Setting the policies and mechanisms for publishing the code.

6․ Working on improving, developing, and updating the code.

7․ Studying the comments received from the relevant entities regarding the code, and proposing any necessary amendments to update it, in coordination with them.

8․ Preparing scientific and technical guides, instructions, and explanations for the code.

9․ Preparing training and qualification curriculums and its plans in cooperation with the relevant entities.

10․ Setting the requirements and controls for examining and inspecting buildings during or after the construction phase to ensure their compliance with code requirements, in cooperation with the relevant entities.

11․ Identifying the obstacles and challenges facing the public and private sectors relating to the code, and providing the necessary insights and suggestions in their regard.

12․ Providing code services, evaluating building laws, and issuing printed materials.

13․ Studying and approving modern construction technologies, and developing tests, standards, and specifications relating to them, in cooperation with the relevant entities.

14․ Preparing studies and research related to the code.

15․ Providing technical consultations in the field of its mandates in accordance with the controls approved by the board.

16․ Signing agreements and memorandums of understanding relating to the fields of its mandates with the relevant entities inside and outside the Kingdom, in accordance with the established legal procedures.

17․ Organizing seminars, holding forums and conferences, and holding workshops, in accordance with the established legal procedures.

18․ Cooperating with research centers and think tanks at local and international levels—when needed —in a manner that contributes to achieving its goals.

19․ Working to provide an appropriate investment environment in the fields of its mandates, in coordination with the relevant entities.

20․ Representing the Kingdom—regionally and internationally—within the limits of the fields of its mandates, in accordance with the established legal procedures.

Article 5

1․ The center must have a board of directors chaired by the minister, and the membership of each of:

(a) A representative from the Ministry of Interior (General Directorate of Civil Defense).

(b) A representative from the Ministry of Energy.

(c) A representative from the Ministry of Municipalities and Housing.

(d) A representative from the Ministry of Environment, Water, and Agriculture.

(e) A representative from the Ministry of Industry and Mineral Resources.

(f) A representative from the Ministry of Commerce.

(g) A representative from the Saudi Council of Engineers.

(h) A representative from the High Commission for Industrial Security.

(i) A representative from the Saudi Standards, Metrology, and Quality Organization.

(j) A representative from the Saudi Contractors Authority.

(k) The chief executive officer.

(l) Two members with experience and expertise from the private sector in the fields of construction and engineering consulting.

2․ The rank of government agency representatives must not be less than the 14th rank or its equivalent.

3․ An order must be issued for the appointment of the two members—referred to in 1(l) of this article—by the Prime Minister based on the nomination of the chairman. The term of their membership is three years, renewable once.

4․ The chairman shall choose his deputy from among the members representing government entities.

5․ A candidate from government entities—for board membership—must have qualifications, experiences, or functional mandates that are compatible with the work of the center.

Article 6

The board is the highest authority of the center, and shall supervise and conduct its affairs. It may take all decisions necessary to achieve its objectives within the limits of the provisions of the arrangements, and in particular, it may do the following:

1․ Proposing draft laws and regulations relating to the fields of its mandates, and proposing amendments to those in force, in coordination with the relevant entities, and reporting on this in accordance with the established legal procedures.

2․ Setting policies, plans, programs, and initiatives in the fields of its mandates, and reporting on matters that require the completion of legal procedures in their regard.

3․ Approving the policies and mechanisms for publishing the code.

4․ Approving the standards, procedures, and forms in the fields of mandates of the center.

5․ Approving the necessary controls and requirements for the licenses issued by the center relateing to activities associated with the fields of mandates of the center.

6․ Setting requirements and controls for examining and inspecting buildings during or after the construction phase to ensure their compliance with code requirements, in cooperation with the relevant entities.

7․ Approving the fee for the services and works provided by the center in the fields of its mandates, which the board determines necessary to obtain a fee for them, in accordance with the established legal procedures.

8․ Approving the organizational structure and guide of the center in accordance with the established legal procedures.

9․ Approving the financial and administrative regulations governing the center and other internal and technical regulations necessary for managing its affairs, provided that the approval of the financial regulations and provisions with financial impact in other regulations is in agreement with the Ministry of Finance, and the approval of the administrative regulations is in agreement with the Ministry of Human Resources and Social Development.

10․ Approving the establishment of branches and offices of the center as needed.

11․ Reviewing the periodic reports submitted by the chief executive officer on the work progress of the center, and taking the necessary decisions in this regard.

12․ Approving the signing of agreements and contracts, in accordance with the established legal procedures.

13․ Approving the draft budget of the center, its final account, the report of the accounts auditor, and the annual report, in preparation for submitting them in accordance with the applicable legal procedures.

14․ Appointing one or more external account auditors and an internal financial controller.

15․ Approving the report of the accounts auditor.

16․ Approving the acceptance of donations, gifts, grants, bequests, and awqaf given to the center, in accordance with the provisions governing this.

The board may form committees to which it may assign tasks as it deems appropriate, and it may delegate some of its powers to its chairman or any of its members it deems appropriate.

Article 7

1․ The board shall meet at the invitation of the chairman at least four times a year, and whenever necessary, as determined by the chairman. The chairman shall invite the board to meet if at least one-third of the members request this.

2․ The invitation to attend the board meeting must be sent at least seven working days before the date of the meeting, and must include the agenda.

3․ For a board meeting to be valid, the attendance of at least a majority of members, including the chairman or his deputy, is required. Decisions are issued by at least a majority of the votes of those in attendance, and in the event of a tie vote, the side with which the chairman of the meeting votes prevails.

4․ A member of the board shall not abstain from voting or authorize another member to vote on his behalf during his absence.

5․ A member shall disclose any conflict of interest in a matter included on the agenda of the board.

6․ The board may—when needed and in urgent cases—hold meetings and vote on decisions remotely using technology.

7․ The board may—when needed and in urgent cases—issue decisions by circulation to the members, and they must be signed to indicate that all members have been informed. Decisions issued in this manner are not valid unless all members vote on them. The decisions must be presented to the board at the first subsequent meeting to be recorded in the minutes of the meeting.

8․ The deliberations and decisions of the board must be recorded in minutes signed by the chairman of the meeting and the members in attendance. The objecting member may record his objection and the reasons for the objection in the minutes of the meeting.

9․ The board may invite whoever it deems necessary to attend its meetings, without them having the right to vote.

10․ The board must have a secretary from among the personnel of the centre appointed by the board based on the nomination of the chairman. He shall assume the secretariat of the board, prepare for meetings, and record minutes, deliberations, and decisions.

11․ A member shall not disclose any of the secrets of the center that he knows of, even after his membership in the board has ended.

Article 8

The center must have a chief executive officer, appointed by a decision of the board. The decision must determine his salary and financial benefits, and he must be relieved of his post by a decision of the board. He is responsible for managing the affairs of the center, and his responsibilities must be within the limits of the arrangements and the decisions of the board. He shall exercise the following mandates:

1․ Preparing draft laws and regulations relating to the fields of his mandates, and proposing amendments to those in force, in preparation for presenting them to the board.

2․ Preparing policies, plans, programmes, and initiatives within the fields of mandates of the center, and submitting them to the board for consideration of their approval.

3․ Preparing standards, procedures, and forms in the fields of mandates of the center, and submitting them to the board for consideration of their approval.

4․ Preparing the necessary controls and requirements for the licenses issued by the center relating to activities within the fields of mandate of the centre, and submitting them to the board for consideration of their approval.

5․ Proposing the fee for the services and works provided by the center in the field of its mandate, and submitting it to the board for consideration of its approval.

6․ Following up on the implementation of the decisions issued by the board.

7․ Proposing the organizational structure and guide of the center, and proposing its administrative, financial, internal, and technical regulations necessary for its operation, and submitting them to the board for consideration of their approval.

8․ Supervising the progress of work of the center and its employees, in accordance with the powers assigned to him and as specified by the regulations of the center.

9․ Disbursing from the budget of the center and taking all financial measures, in accordance with the approved laws and regulations, and within the limits of the powers delegated to him by the board.

10․ Supervising the preparation of the draft budget of the center, the draft final account, and the annual report of the center, and submitting them to the board.

11․ Representing the center before the judiciary, and before government entities, other relevant institutions and authorities, and other entities inside and outside the Kingdom, and he may authorize others to do so.

12․ Preparing periodic reports on the works of the center, its achievements, activities, and the obstacles it faces, and submitting them to the board in preparation for completing the necessary matters in their regard.

13․ Signing agreements and contracts after the approval of the board, or in accordance with the powers granted to him by the board.

14․ Appointing, supervising, and terminating the services of the personnel of the center in accordance with the powers granted to him and as specified by the relevant laws and regulations.

15․ Contracting with experts, specialists, and consultants in fields relating to the objectives of the center, as specified by the approved regulations of the center.

16․ Submitting proposals and recommendations to the board regarding topics within his mandates.

17․ Exercising any mandate assigned to him by the board.

The chief executive officer may delegate some of his mandates and powers to other personnel of the center.

Article 9

1․ The resources of the center consist of the following:

(a) The financial appropriations allocated to it in the state budget.

(b) The fee charged by it for the works and services it provides.

(c) Donations, gifts, grants, bequests, and awqaf revenue accepted by the board.

(d) Other resources approved by the board, provided that they do not conflict with the laws and instructions.

2․ All revenues of the authority must be deposited in the current account of the Ministry of Finance in the Saudi Central Bank.

3․ The center shall open an account in the Saudi Central Bank, and may open other accounts at any of the banks licensed to operate in the Kingdom. Disbursements from these accounts must be made in accordance with the approved budget of the center.

Article 10

The personnel of the center are subject to the Labor Law and the Social Insurance Law.

Article 11

1․ The center must have an independent annual budget.

2․ The financial year of the center is the financial year of the state.

Article 12

The center shall submit to the Prime Minister—within 90 days from the end of the financial year‏—its annual final account, an annual report on the achievements of the center, the difficulties it faced, and any proposals it deems necessary to improve the conduct of its work.

Article 13

Without prejudice to the mandates of the General Court of Audit to oversee the accounts and operations of the center, the board shall appoint one (or more) external account auditors licensed to work in the Kingdom to audit the accounts, transactions, and statements of the center. The board shall determine their fees and submit the report of the accounts auditor to the board, with a copy of it provided to the General Court of Audit.

Article 14

The arrangements must be published in the official gazette, and come into force from the date of their publication.


Published in Umm Al-Qura 5077 issued on 28 March 2025.

Categories
Council of Ministers Decision

Council of Ministers: Decision 659 Approving the System of the Saudi Investment Promotion Authority

Arabic

The Council of Ministers,

after perusal of Royal Court File 29088 dated 19 Rabi Al-Thani 1445 [3 November 2023], which includes the Minister of Investment, Chairman of the Board of Directors of the Saudi Investment Promotion Authority, Telegram 3734 dated 17 Rabi Al-Thani 1445 [1 November 2023] regarding the draft System of the Saudi Investment Promotion Authority,

after perusal of the mentioned draft system,

after perusal of the Organizational Arrangements of the Saudi Investment Promotion Authority issued by Council of Ministers Decision 13 dated 4 Muharram 1444 [2 August 2022],

after perusal of Council of Ministers Decision 721 dated 26 Shawwal 1444 [16 May 2023] and Decision 203 dated 30 Safar 1446 [3 September 2024],

after perusal of Bureau of Experts at the Council of Ministers Memorandum 3027 dated 18 Sha’ban 1445 [28 February 2024], Memorandum 188 dated 10 Muharram 1446 [16 July 2024], and Memorandum 1970 dated 7 Jumada Al-Thani 1446 [8 December 2024],

after perusal of Council of Economic and Development Affairs Recommendation 11/46/RC dated 25 Safar 1446 [29 August 2024],

after perusal of Council of Economic and Development Affairs Recommendation 10-25/46/D dated 25 Jumada Al-Thani 1446 [26 December 2024],

and after perusal of General Committee of the Council of Ministers Recommendation 8284 dated 14 Sha’ban 1446 [13 February 2025],

hereby decides

First

The System of the Saudi Investment Promotion Authority is hereby approved in the form attached.

Second

The system—stipulated in clause First above—hereby replaces the Organizational Arrangements of the Saudi Investment Promotion Authority issued by Council of Ministers Decision 13 dated 4 Muharram 1444 [2 August 2022],

Third

The Board of Directors of the Saudi Investment Promotion Authority shall exercise its mandate to determine the fee stipulated in article 5(8) of the system, in agreement with the Ministry of Finance and the Non-Oil Revenue Development Center, until the issuance and entry into force of the Governance of the Practice of Imposing the Fee for Services and Works Provided by Entities That Have the Legal Authority to Impose a Fee.

Fourth

The Board of Directors of the Saudi Investment Promotion Authority shall exercise its mandates—stipulated in the system—without prejudice to the provisions contained in the Rules for Approving the Provisions Governing the Affairs of Employees in Public Agencies and Their Compensation issued by Council of Ministers Decision 721 dated 26 Shawwal 1444 [17 May 2023],

Fifth

The Board of Directors of the Saudi Investment Promotion Authority shall—in accordance with the provisions of the Council of Ministers Decision 203 dated 30 Safar 1446 [3 September 2024]‏—carry out the mandates of the board of directors—stipulated in article 5 of the system‏—until it is formed in accordance with article 4 of the system, provided that this is limited to exercising the mandates of the board related to conducting its business, without including mandates related to approving financial and administrative policies and regulations.

The Prime Minister

Issued on: 4 Ramadan 1446
Corresponding to: 4 March 2025

Published in Umm Al-Qura 5075 issued on 14 March 2025.

Categories
Laws and Regulations

The System of the Saudi Investment Promotion Authority

Arabic

Issued by Council of Ministers: Decision 659


Article 1

The following phrases and words—wherever they appear in this system—have the meanings assigned to each of them, unless the context requires otherwise:

System:
The System of the Saudi Investment Promotion Authority.

Ministry:
The Ministry of Investment.

Minister:
The Minister of Investment.

Authority:
The Saudi Investment Promotion Authority.

Board:
The board of directors of the authority.

Chairman:
The chairman of the board.

Chief executive officer:
The chief executive officer of the authority.

Investment promotion:
A set of works relating to encouraging investors to invest and expand their investments in investment opportunities and projects in the Kingdom, and marketing them inside and outside the Kingdom, including: Liasing with investors and organizing events, activities, exhibitions, and forums.

Article 2

The authority enjoys legal personality and financial and administrative independence. It is legally affiliated with the minister and its headquarters must be in the City of Riyadh, and it may establish branches or offices inside and outside the Kingdom as needed.

Article 3

The authority shall aim to position the Kingdom as a global and national investment destination, promote investment opportunities across all sectors in all their components, and promote works and services relating to investment promotion, in light of the general investment policies and executive plans prepared by the ministry. It may—without prejudice to the mandates and responsibilities of other entities—carry out all that is necessary to achieve its objectives, including the following:

1․ Preparing general policies relating to its activity and the plans and programs necessary to implement them, and reporting on matters that require completion of procedures in their regard.

2․ Preparing the investment promotion strategy and the plans and programs necessary to implement it, and reporting on matters that require completion of procedures in their regard.

3․ Performing works relating to investment promotion inside and outside the Kingdom, to introduce the investment advantages, opportunities, and incentives in the Kingdom. The authority may directly assign any of the mentioned works to the entity concerned with investment promotion.

4․ Managing a unified national identity to promote and attract investments to the Kingdom and activating it in coordination with the ministry and relevant entities, in order to unify messages and content and coordinate promotion and media efforts for investment.

5․ Proposing an amendment to the laws relating to its mandates, and reporting it to complete the legal procedures in its regard.

6․ Supporting investment promotion activities carried out by ministries, relevant entities, and the private sector.

7․ Setting media plans to support investment promotion, and implementing them inside and outside the Kingdom.

8‏. Holding and organizing meetings, conferences, forums, and exhibitions to promote investment inside and outside the Kingdom, and participating in them by any means deemed appropriate.

9․ Participating with the ministry in identifying indicators that measure investment promotion performance.

10․ Utilizing specialists and experts from distinguished national and international companies and institutions to provide professional products and tools and benefiting from their expertise in their fields of specialization.

11․ Encouraging partnerships that achieve the development objectives between the local investor and the foreign investor.

12․ Issuing the necessary approvals for government entities to hold exhibitions, forums, and conferences in the field of investment promotion.

13․ Working to attract international conferences relating to investment promotion, contributing to the development of national conferences, and supporting them, as well as creating new initiatives for this purpose, in accordance with the legal procedures.

14․ Cooperating and exchanging expertise with government entities, regional and international bodies and organizations, and similar authorities in other countries, within the limits of its mandates.

15․ Providing support for the programs and initiatives of the ministry relating to investment promotion outside the Kingdom.

16․ Collecting, recording, and following up on feedback and challenges of investors, and providing them to the ministry for resolution.

17․ Participating in international organizations and associations in relation to its mandates, in accordance with the legal procedures.

18․ Representing the Kingdom in international forums and exhibitions relating to its mandates.

19․ Preparing studies and research relating to investment promotion, and issuing periodic and specialized reports.

Article 4

The authority must have a board of directors chaired by the minister and the membership of each of:

1․ A representative from the Ministry of Investment.

2․ Representatives of government entities, not exceeding four, and those entities must be determined by an order of the Prime Minister based on a proposal from the chairman.

3․ Representatives of expertise and specialization in the fields of work of the authority, not exceeding three, whose appointment must be by an order issued by the Prime Minister based on a nomination from the chairman.

4․ The rank of representatives of government entities in the board referred to in paragraphs 1 and 2 of this article must not be less than 15 or its equivalent.

The term of membership in the board is three years, renewable once.

Article 5

The board is the supreme body of the authority. It shall supervise the management of the authority, conduct its affairs, and take all necessary decisions to achieve its objectives within the limits of the provisions of the system, in particular the following:

1․ Approving the general policies relating to the activity of the authority and the plans and programs necessary to implement them, and reporting on matters that require completion of procedures in their regard.

2․ Adopting the investment promotion strategy, and reporting on matters that require completion of procedures in their regard.

3․ Proposing an amendment to the laws relating to the mandates of the authority, and submitting it to complete the legal procedures in its regard.

4․ Approving administrative regulations in agreement with the Ministry of Human Resources and Social Development, and approving financial regulations and provisions with financial impact in other regulations in agreement with the Ministry of Finance.

5․ Approving internal regulations and other regulations necessary to conduct the work of the authority.

6․ Approving the organizational structure and manual of the authority.

7․ Approving the establishment of branches and offices of the authority inside and outside the Kingdom.

8․ Determining the fees for the work and services provided by the authority.

9․ Approving the draft annual budget, final account, and annual report of the authority, in preparation for their adoption in accordance with the legal procedures.

10․ Appointing an external accounts auditor and an internal financial controller.

11․ Approving the signing of agreements and contracts, in accordance with the legal procedures.

12․ Accepting gifts, donations, grants, bequests, and awqaf, in accordance with the provisions governing this.

13․ Reviewing the periodic reports submitted to it on the progress of work of the authority.

14․ Approving the participation of the authority in specialized international organizations and associations, in accordance with the legal procedures.

The board may—in order to achieve its mandates—form standing or temporary committees from among its members or others, to which it assigns the tasks it deems fit. The decision to form each committee must specify its head, members, and mandates. The committees may seek assistance from whomever they deem necessary to carry out the tasks assigned to them.

The board may delegate some of its mandates to the chairman, or to any of its members or authority personnel it deems appropriate.

Article 6

1․ The board shall meet periodically—at least— twice a year, and whenever necessary, as determined by the chairman. Its meetings must be chaired by the chairman or his delegate from the members representing the government entities in the board. The chairman or his delegate shall send an invite for the meeting. The meeting is valid if attended by at least a majority of the members, including the chairman or his delegate. Decisions must be issued by a majority of the votes of at least the members in attendance, and in the event of a tie vote, the side with which the chairman of the meeting voted prevails.

2․ The deliberations, decisions, and recommendations of the board must be recorded in minutes signed by the chairman of the meeting and the members in attendance.

3․ The board may invite whomever it deems appropriate to attend its meetings to benefit from their information and expertise, without them having the right to vote.

4․ ‏A member shall not abstain from voting or authorize another member to vote on his behalf during his absence.

An objecting member may record his objection and the reasons for the objection in the minutes of the board meeting.

5․ Board meetings must be held at the headquarters of the authority. It is permitted to hold them elsewhere if necessary.

6․ ‏The board may—when necessary, in urgent cases, and as determined by the chairman—issue a decision or recommendation by circulation, and it must be signed in a manner that indicates that all members have read it. Recommendations and decisions issued in this manner are not valid unless they are circulated and voted upon by all members of the board and obtain at least a majority of their votes.

7․ It is permitted—when necessary, in urgent cases, and as determined by the chairman—to hold meetings and vote on decisions remotely using technology.

8․ The board shall set the rules and procedures governing the holding of its meetings remotely, including determining the procedures for invitation to meetings and the mechanism of holding them.

Article 7

The authority must have a chief executive officer who is appointed and dismissed from his position by a decision by the board based on the nomination of the chairman. He must be responsible for managing the affairs of the authority, and his responsibilities must be focused within the limits of the system and decisions of the board. He shall undertake the following mandates:

1․ Supervising the preparation of general policies relating to the work of the authority and the plans and programs necessary for their implementation, and submitting them to the board.

2․ Supervising the preparation of the investment promotion strategy and the plans and programs necessary for its implementation, and submitting them to the board.

3․ Supervising the conduct of work of the authority through approved laws, regulations, plans, and programs.

4․ Contracting with experts, consultants, and think tanks to serve the objectives and mandates of the authority, in accordance with the regulations of the authority and applicable legal procedures.

5‏. Supervising the preparation of the administrative and financial regulations governing the authority, and other internal regulations necessary for the conduct of work of the authority, in preparation for submitting them to the board for approval.

6․ Proposing the organizational structure and manual of the authority, and submitting them to the board.

7‏. Proposing plans to develop the work of investment promotion in the Kingdom.

8․ Supervising the preparation of reports on the implementation of the plans and programs of the authority, and presenting them to the board.

9‏. Supervising the preparation of the annual report, draft budget, and final account of the authority, and submitting them to the board for approval, in preparation for completing the necessary legal procedures in their regard.

10․ Signing agreements and contracts—related to the mandates of the authority—after board approval, in accordance with the established legal procedures.

11․ Representing the authority before the judiciary, government entities, other relevant institutions, and other entities inside and outside the Kingdom, and he may authorize others to do so.

12‏. Disbursing from the budget of the authority and taking all financial measures in accordance with the laws and regulations approved by the board, within the limits of the powers delegated to him by the board.

13‏. Contracting to implement works, services, and others, in accordance with the laws and powers delegated to him by the board.

14‏. Proposing the establishment of branches or offices for the authority inside and outside the Kingdom.

15‏. Issuing the necessary decisions to implement the provisions of the system, the regulations issued based on it, and the adopted rules and procedures, in accordance with the powers granted to him.

16‏. Adopting work procedures based on the regulations and decisions issued by the board.

17․ Appointing and supervising authority personnel, in accordance with the regulations governing this.

18‏. Any other mandate assigned to him by the board.

The chief executive officer may delegate some of his mandates to the authority personnel he deems appropriate.

Article 8

Authority personnel are subject to the Labor Law and the Social Insurance Law.

Article 9

1․ ‏The authority must have an independent annual budget.

2․ The fiscal year of the authority is the fiscal year of the state.

Article 10

1․ The resources of the authority consist of the following:

(a) Appropriations allocated to it in the general budget of the state.

(b) The fee charged by the authority for the services and work it provides.

(c) Gifts, donations, grants, bequests, and awqaf revenues accepted by the board.

(d) Any other resource approved by the board, provided that it does not violate the laws and instructions.

2․ All revenues of the authority must be deposited in the current account of the Ministry of Finance in the Saudi Central Bank.

3․ An account must be opened for the authority in the Saudi Central Bank, and other accounts may be opened for it in any of the banks licensed to operate in the Kingdom. Amounts must be disbursed from these accounts in accordance with the approved budget of the authority.

Article 11

The authority shall submit its annual final account to the Council of Ministers within 90 days from the end of the fiscal year, and a copy of it must be provided to the General Court for Audit.

Article 12

The authority shall submit to the Prime Minister, within 90 days from the end of the fiscal year, an annual report on its achievements during the past year, the difficulties it has faced, and any proposals it deems necessary to improve the conduct of work.

Article 13

Without prejudice to the mandates of the General Court for Audit, the board shall appoint one or more external account auditors licensed to operate in the Kingdom to audit the accounts of the authority and its transactions, statements, annual budget, and final account, and the board shall determine their fees. The report of the accounts auditor must be submitted to the board, and a copy of it must be provided to the General Court for Audit after its approval.

Article 14

The system enters into force from the date of its approval.


Published in Umm Al-Qura 5075 issued on 14 March 2025.

Categories
Royal Decree

Royal Decree D/195 Regarding the Practice of Activities Relating to Pharmacies and Establishments Selling Herbal Preparations

Arabic

With the help of Allah the Almighty,

We, Salman bin Abdulaziz Al-Saud,

the King of the Kingdom of Saudi Arabia,

based on article 70 of the Basic Law of Governance issued by Royal Order O/90 dated 27 Sha’ban 1412 [1 March 1992],

based on article 20 of the Law of the Council of Ministers issued by Royal Order O/13 dated 3 Rabi Al-Awwal 1414 [20 August 1993],

based on article 18 of the Law of the Shura Council issued by Royal Order O/91 dated 27 Sha’ban 1412 [1 March 1992],

after perusal of Shura Council Decision 117/11 dated 1 Jumada Al-Thani 1446 [2 December 2024],

and after perusal of Council of Ministers Decision 634 dated 26 Sha’ban 1446 [25 February 2025],

have decreed as follows

First

The practice of activities relating to pharmacies and establishments selling herbal preparations—referred to in article 3 of the Law of the Pharmaceutical Establishments and Preparations (repealed) issued by Royal Decree D/31 dated 1 Jumada Al-Thani 1425 [18 July 2004]—is hereby approved without requiring the owner to be Saudi, until the issuance and entry into force of the Integrated Health Law.

Second

The Prime Minister, the ministers, and the heads of independent concerned authorities—each within their area of competence—shall implement this decree of Ours.

Salman bin Abdulaziz Al-Saud

Issued on: 3 Ramadan 1446
Corresponding to: 3 March 2025

Published in Umm Al-Qura 5075 issued on 14 March 2025.

Categories
Laws and Regulations

The Executive Regulation for Monitoring and Compliance with Water Efficiency and Conservation Standards

Arabic

Issued by Council of Ministers Decision 682


This regulation is issued based on:

1․ The Minister of Environment, Water, and Agriculture Decision 25207748 dated 2 Ramadan 1446 [23 October 2024] approving the Executive Regulation for Monitoring and Compliance with Efficiency and Conservation Standards for the articles contained in chapter eight of the Water Law (from article 37 to article 40) that are directly related to the mandates of the National Water Efficiency and Conservation Center.

2․ The provisions of clauses Third, Fourth, and Fifth of the System of the National Center for Water Efficiency and Conservation issued by Council of Ministers Decision 336 dated 20 Jumada Al-Thani 1442 [2 February 2021].

3․ The provisions of article 4(3), (7), (11), and (12) of the System of the National Center for Water Efficiency and Conservation issued by Council of Ministers Decision 336 dated 20 Jumada Al-Thani 1442 [2 February 2021].

Chapter One
Definitions, Objectives, and Scope of Application

Article 1

The following terms and phrases—wherever they appear in this regulation—have the meanings assigned to each of them, unless the context requires otherwise:

Center:
The National Center for Water Efficiency and Conservation.

Regulation:
The Executive Regulation for Monitoring and Compliance with Water Efficiency and Conservation Standards

Law:
The Water Law.

Water efficiency:
Improving the efficiency of the water supply chain.

Water conservation:
The optimal use of water for urban, industrial, or agricultural purposes.

Committee:
The committee for considering and deciding on violations of the provisions of the law relating to the mandates of the ministry and its regulations.

Competent entities:
Government entities, including ministries, public authorities and institutions, centres, and similar entities, that have the authority to issue legislation, standards, or requirements relating to water efficiency and conservation.

Urban sector:
Water consumers for residential, commercial, and building purposes, as well as for public utility, afforestation, public parks, and similar uses.

Agricultural sector:
Water consumers for plant and animal resources purposes.

Industrial sector:
Water consumers for industrial purposes including oil and gas extraction, mining, and manufacturing of goods.

Maximum flow:
The maximum liquid flow specified on the product measured in liters per minute (liter/min), for flush urinals, dual/single flush toilets, and oriental toilet flush tanks (liter/flush).

Nominal flow:
The volume of fluid passing through the product measured in liters per minute (liter/min), for flush urinals, dual/single flush toilets, and oriental toilet flush tanks (liter/flush).

Specification:
An approved document that sets out rules, instructions, or characteristics for products, processes, and related production methods (Saudi specification, national specification, regional specification, and international specification).

Products:
Sanitary products and equipment that control and direct the flow “flushing” of water, including: Faucets of all types and shapes, and toilets that operate with a water flushing system of all types and shapes, including flush tanks “siphon”, for all types of mechanical, electronic, or sensor-operated items, designed to conserve water consumption.

Water duty:
The quantity of water determined in accordance with the needs of different crops.

Water footprint:
A detailed analysis of water used in goods and services in the Kingdom.

Grey water:
Water resulting from various uses—excluding water resulting from toilets—including water resulting from showers, handwash basins, kitchens, dishwashers, laundry tubs, car washing, floor washing, and swimming pools.

Licensees:
Water efficiency and conservation service providers licensed by The National Center for Water Efficiency and Conservation, in accordance with the requirements specified in the Regulation for Licensing Water Efficiency and Conservation Service Providers.

Service provider:
Those licensed—by virtue of the provisions of the Water Law—for the activity of providing water distribution and retail services, or for the activity of collecting and transporting wastewater.

Article 2

The regulation aims to achieve the following:

1․ Establishing a comprehensive mechanism to ensure compliance with water efficiency and conservation.

2․ Achieving water sustainability by complying with water use efficiency and conservation standards in urban, agricultural, and industrial sectors.

3․ Ensuring the implementation of the strategic plan of the center in regard to monitoring and compliance.

4․ Ensuring compliance with water efficiency and conservation standards.

5․ Covering current gaps in terms of monitoring and compliance.

6․ Integrating with relevant entities to raise water efficiency and conservation.

7․ Activating the monitoring role of the center in ensuring compliance with water efficiency and conservation standards.

8․ Setting the legal basis for the public sector monitoring mechanism and procedures for escalation and referral to His Majesty.

Article 3

All natural or legal persons, whether public or private, are subject to the provisions of this regulation. Its provisions are applied for the purposes of monitoring compliance with water efficiency and conservation standards in urban, agricultural, and industrial sectors.

Chapter Two
Water Efficiency and Conservation Compliance Standards

Article 4

A person in charge of water extraction, production, transportation, distribution, and use in the urban sector shall comply with the requirements and standards of water consumption conservation laws, as issued by the competent entities, which include but are not limited to the following:

1․ The provisions of the checklist in the Water Efficiency and Conservation in Buildings Guide approved by the National Committee for the Saudi Building Code.

2․ The maximum flow rate in water consumption conservation devices.

3․ The permitted limits for the nominal flow rate of water consumption conservation devices.

4․ The technical regulations and specifications for water consumption conservation products and devices.

5․ The priorities of water use provided in the Water Law, and all that is issued by the competent entities in this regard.

Article 5

A person in charge of water extraction, production, transportation, distribution, and use in the agricultural sector shall install advanced and efficient devices and technologies, shall comply with water duty laws, shall direct the use in a manner that ensures water sustainability in the agricultural sector and achieves the minimum level of environmental balance, and shall comply with the standards and requirements issued by the competent entities (the Office of the Undersecretary of the Ministry for Agriculture and the General Irrigation Corporation) in this regard, which include but is not limited to the following:

1․ Requirements for obtaining water supply licenses in the agricultural sector.

2․ Complying with the priorities of water use in the agricultural sector in accordance with the law and all that is issued by the competent entities.

3․ Water duties for water quantities in accordance with crop needs.

4․ Directing use to auxiliary water sources, then surface water, then renewable groundwater, then non-renewable groundwater, according to usage directives, in accordance with the provisions of the Executive Regulation of the Water Law relating to the mandates of the Ministry of Environment, Water, and Agriculture.

Article 6

A person in charge of water extraction, production, transportation, distribution, and use in the industrial sector shall comply with the standards and requirements issued by the competent entities, which include but are not limited to the following:

1․ Complying with installing water conservation systems.

2․ Complying with the required water quantities for each industry.

3․ Complying with the legally licensed uses.

4․ Using water in accordance with the priorities set by the law and all that is issued by the competent entities.

5․ Decisions issued regarding the allocation of water footprint for industrial products.

6․ Directing use to auxiliary water sources, then surface water, then renewable groundwater, then non-renewable groundwater, according to usage directives, in accordance with the provisions of the Executive Regulation of the Water Law relating to the mandates of the Ministry of Environment, Water, and Agriculture.

Article 7

Those licensed to provide water efficiency and conservation services shall verify the standards that ensure conservation of consumption in the urban, agricultural, and industrial sectors, as issued by the center. These standards include but are not limited to the following:

1․ Reviewing water consumption quantities in the urban, agricultural, and industrial sectors and their compliance with standard quantities.

2․ Verifying the presence of sanitary devices that are water-conserving in accordance with the standards issued by the competent entities.

3․ Issuing reports on water efficiency and conservation and providing solutions.

4․ Maintaining the confidentiality of customer information and data.

Chapter Three
Roles and Responsibilities of the Center and Other Entities

Article 8

The center shall engage in its role in achieving compliance with water efficiency and conservation standards through the following works:

1․ Preparing an annual plan to monitor compliance with water efficiency and conservation standards.

2․ The center shall monitor compliance with water efficiency and conservation standards in all sectors, in coordination with relevant entities.

3․ Receiving and reviewing reports on the results of monitoring compliance with water efficiency and conservation standards.

4․ Issuing periodic reports on the results of monitoring compliance with water efficiency and conservation standards.

5․ Submitting a report to His Majesty on water consumption of government entities, including the results of monitoring compliance with efficiency and conservation standards.

6․ Monitoring the activities of water efficiency and conservation service providers, detecting their violations, and imposing punishments on them in accordance with the Water Efficiency and Conservation Service Provider Licensing Regulations.

7․ Raising awareness of water efficiency and conservation in coordination with relevant entities.

Article 9

Government entities shall carry out the following roles to ensure compliance with water efficiency and conservation standards:

1․ Providing data related to its buildings and water consumption, in accordance with forms set by the center in coordination with the Government Expenditure and Projects Efficiency Authority.

2․ Submitting quarterly reports on its efforts to conserve water consumption, its work in this regard, and its plans in this field.

3․ Each government entity shall nominate a representative to coordinate with the center regarding the standards issued for water consumption conservation in the government sector and the mechanisms for their implementation.

4․ Each government entity shall coordinate with the center to prepare and implement programs to raise awareness among its personnel about water consumption conservation.

Article 10

Those licensed by the center shall comply with monitoring water efficiency and conservation standards in accordance with the provisions of the Water Efficiency and Conservation Service Provider Licensing Regulation and the provisions of this regulation.

Chapter Four
Forms of Violations and Detection and Referral Mechanisms

Article 11

Taking into account matters that fall within the mandate of the ministry and the mandate of the relevant entities, whoever commits any of the following acts is considered a violator:

First
Urban sector

1․ Using non-water-conserving sanitary devices—for each device—including, but not limited to: Mixers, faucets, showers, bidets, flush tanks.

2․ Tampering with or removing the conserving part of the water-conserving sanitary device (for each device).

3․ Wasting drinking water from the underground or overhead tank due to cracks in the tank body, insulation, malfunction, or lack of a float valve for each tank.

4․ Using drinking water for non-designated purposes, when alternative sources are available, such as treated wastewater, a treated water network, or a licensed well.

5․ Not operating the grey water station for buildings and complexes that meet the conditions for installing such stations.

6․ Using a non-water-conserving irrigation system.

7․ The presence of a leak from the irrigation network or the internal water network.

8․ Not placing water conservation in public facilities awareness materials in languages appropriate for users (for each building).

Second
Agricultural sector

1․ Violating the conditions of water licensing requirements regarding compliance with water conservation and efficiency in the agricultural sector.

2․ Not using water-conserving irrigation systems, devices, and technologies.

Third
Industrial sector

1․ Penalties for urban uses are applicable to the industrial sector, as provided in the urban sector penalties above (from 1 to 8).

2․ Failing to comply with the water footprint allocated in the industrial sector in accordance with the decisions issued regarding the allocation of the water footprint for industrial products.

Fourth
Water efficiency and conservation service providers

1․ Failing to comply with the implementation of forms, methods, and requirements for reviewing urban sector compliance with standard water quantities, industrial sector compliance with the water footprint, and agricultural sector compliance with water duties.

2․ Failing to comply with the implementation of forms, methods, and mechanisms to verify the presence of water-conserving sanitary devices in accordance with the standards issued by the competent entities.

3․ Failing to submit the necessary reports on all of the above in accordance with the requirements of the center.

4․ Carrying out an activity relating to water efficiency and conservation services without a license from the center.

Fifth
General violations

1․ Failing to provide the center with information and documents relating to water efficiency and conservation, from any water user.

2․ Violating the technical regulations, standards, and procedures issued by the center that achieve water efficiency and conservation.

3․ Preventing or obstructing controllers and those competent with inspecting, policing, and investigating from performing their work.

Article 12

1․ Enforcement officers shall police, prove, and investigate violations of these regulations, in accordance with the provisions of article 66 of the Water Law.

2․ The reports of violations and their investigation must be referred to the committee mentioned in article 70(1) of the Water Law, to consider and decide on violations of water use conservation, and to impose punishments in accordance with the schedule for classifying violations and determining punishments attached to this regulation.

Article 13

The center shall observe compliance with water efficiency and conservation standards in accordance with the following mechanisms:

1․ The center shall coordinate with relevant entities to establish a database to obtain information and documents relating to water efficiency and conservation for any water user.

2․ Ministries, government agencies, and relevant entities shall provide the center, via the designated electronic platform, with information and data relating to water efficiency and conservation standards, in accordance with the forms set by the center.

3․ Data and information received from relevant entities are governed in accordance with the national indicators, plans, policies, and programs prepared by the center.

4․ The center shall provide relevant entities with any deviations from the objectives it has set based on data issued by those entities, and shall issue its corrective recommendations accordingly.

5․ Licensees are subject to the procedures for detecting and policing violations and imposing punishments in accordance with the provisions of the Regulation for Licensing Water Efficiency and Conservation Service Providers.

Chapter Five Final Provisions

Article 14

The center may conduct a periodic review of the standards and mechanisms for ensuring compliance with their implementation and monitoring.

Article 15

This regulation must be published in the official gazette, and comes into force from the date of its publication.

Annex
Schedule for Classifying Violations and Determining Punishments for Violators of Water Efficiency and Conservation in Accordance with the Water Law and Its Executive Regulation

Item Violation Initial procedure (warning) Fine amount (minimum) Riyals Fine amount (maximum) Riyals Correction period after warning Extent of impact
Urban sector
1 Using non-water-conserving sanitary devices that are not in accordance with standards and regulations ‎ issued by the Saudi Standards, Metrology, and Quality Organization. Applies 1,000 10,000 14 days Non-grievous
2 Tampering with or removing the conserving part of the water-conserving sanitary device (for each device). Applies 500 2,000 14 days Non-grievous
3 Wasting drinking water from the underground or overhead tank due to cracks in the tank body, insulation, malfunction, or lack of a float valve for each tank. Applies 5,000 50,000 14 days Non-grievous
4 Using drinking water for non-designated purposes, when alternative sources are available, such as treated wastewater, a treated water network, or a licensed well. Not applicable 25,000 200,000 Not applicable Grievous
5 Not operating the grey water station for buildings and complexes that meet the conditions for installing such stations. Not applicable 50,000 100,000 Not applicable Grievous
6 Using a non-water-conserving irrigation system. Applies 5,000 100,000 14 days Non-grievous
7 The presence of a leak in the irrigation network or the internal water network. Applies 2,000 10,000 14 days Non-grievous
8 Not placing water conservation in public facilities awareness materials in languages appropriate for users (for each building). Applies 2,000 10,000 14 days Non-grievous
Agricultural sector
1 Breaching the conditions of water licensing requirements regarding compliance with water conservation and efficiency in the agricultural sector. Not applicable 25,000 100,000 Not applicable Grievous
2 Not using water-conserving irrigation systems, devices, and technologies. Applies 2,000 20,000 14 days Non-grievous
Industrial sector
1 Penalties for urban uses are applicable to the industrial sector, as provided in the urban sector penalties above (from 1 to 8).
2 Failing to comply with the water footprint allocated in the industrial sector in accordance with the decisions issued regarding the allocation of the water footprint for industrial products. Not applicable 25,000 200,000 Not applicable Grievous
Water efficiency and conservation service providers
1 Failing to comply with the implementation of inspection forms and ensuring the compliance of the sectors (urban—agricultural—industrial) of the quantities of water allocated for each use, as issued by the competent entities. Not applicable 25,000 200,000 Not applicable Grievous
2 Failing to comply with the forms required by the center, failing to use the required measuring devices, or the absence of the required water-conserving sanitary devices or their non-compliance with the standards issued by the competent entities. Not applicable 25,000 200,000 Not applicable Grievous
3 Failing to submit the necessary reports to the center in accordance with the adopted requirements. Applies 2,000 5,000 14 days Non-grievous
4 Carrying out an activity relating to water efficiency and conservation services without a license from the center. Applies 1,000 5,000 30 days Non-grievous
General violations
1 Failing to provide the center with information and documents relating to water efficiency and conservation, from any water user. Applies 1,000 5,000 14 days Non-grievous
2 Violating the technical regulations, standards, and procedures issued by the center that achieve water efficiency and conservation. Not applicable 500 50,000 Not applicable Non-grievous
3 Preventing or obstructing controllers and those competent with inspecting, policing, and investigating from performing their work. Not applicable 10,000 100,000 Not applicable Grievous

Published in Umm Al-Qura 5076 issued on 21 March 2025.

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