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Law on Real Estate Ownership and Investment by Non-Saudis Amended to Boost Competitiveness

Saudi Arabia amends law to enable non-Saudis own and invest in real estate (Asharq Al-Awsat)
Saudi Arabia amends law to enable non-Saudis own and invest in real estate (Asharq Al-Awsat)
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Law on Real Estate Ownership and Investment by Non-Saudis Amended to Boost Competitiveness

Saudi Arabia amends law to enable non-Saudis own and invest in real estate (Asharq Al-Awsat)
Saudi Arabia amends law to enable non-Saudis own and invest in real estate (Asharq Al-Awsat)

Saudi Arabia amended the Law on Real Estate Ownership and Investment by non-Saudis to increase and improve the efficiency and effectiveness of the procedures and controls related to the ownership or use of real estate by foreigners, who enjoy natural and legal capacity in cities and economic zones in the Kingdom targeted for development, including the cities of Makkah and Madinah.

The proposed amendment enhances the competitiveness and marketing capacity of real estate in the Kingdom and stimulates growth in other economic sectors.

Asharq Al-Awsat reviewed a copy of the new law which stated that the prime minister would issue the executive regulations of the amended law.

A provision in the amended law permits international and regional organizations to own their official headquarters, which is within the limits of the agreements governing them.

The ownerships would be granted on obtaining a license from the Minister of Foreign Affairs, as specified in the amended law.

The amended law stipulates that it is not permissible, by any means other than inheritance, to acquire the right to own, use or have an easement over real estate located within the Two Holy Mosques for persons prohibited from entering there.

Notary publics or any competent authority are prohibited from documenting any behavior that does not comply with the provisions of the law, provided that the new law replaces the system of non-Saudi ownership of the real estate in the Kingdom issued by Royal Decree (M/22).

Last year, the Ministry of Investment called on the public to review the real estate ownership law through the Istitlaa platform to regulate and protect real estate ownership rights and set general principles for the protection and regulation of real estate in the Kingdom.

The draft law identified eight real estate transactions: barter sale, lending, leasing, mortgage, endowment, gift, and reconciliation.

The draft system sets eight reasons for a natural or legal person to own real estate, indicating that real estate or unit ownership is transferred for one of these reasons, and the transfer is invalid until after it is documented in the real estate registry, following the provisions of its regulations.

The Ministry of Investment recently confirmed an increase in the economic growth, noting that real GDP grew by seven percent during Q3 and 6.7 percent in Q4 in 2021, driven by the change in the oil and non-oil sector, recording a growth of 10.9 percent and 5.1 percent, respectively.

Foreign projects achieved record numbers, bringing the number of licenses for new projects to 3,386 permits, increasing 347.9 percent compared to the second half of 2020.

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Urgent Financial Tasks Await Lebanon’s Emerging Government

Lebanese President Joseph Aoun stands between Speaker of Parliament Nabih Berri and caretaker Prime Minister Najib Mikati (dpa)
Lebanese President Joseph Aoun stands between Speaker of Parliament Nabih Berri and caretaker Prime Minister Najib Mikati (dpa)
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Urgent Financial Tasks Await Lebanon’s Emerging Government

Lebanese President Joseph Aoun stands between Speaker of Parliament Nabih Berri and caretaker Prime Minister Najib Mikati (dpa)
Lebanese President Joseph Aoun stands between Speaker of Parliament Nabih Berri and caretaker Prime Minister Najib Mikati (dpa)

A broad internal consensus, encompassing both political and economic dimensions, is taking shape to adopt the principles outlined in the presidential inauguration address as the foundation of the new government’s program and ministerial statement. This approach aims to sustain Lebanon’s immediate and strong positive momentum, which is reinforced by widespread support on both Arab and international levels.

Economic bodies and professional unions representing business sectors have openly expressed their relief and full support for the strategic directions set by President Joseph Aoun following his election. However, they have made it clear that maintaining this positive momentum depends on the formation of a reform-oriented rescue government, composed of competent, experienced, and honest ministers. This government must also collaborate constructively with the president.

According to a senior financial official, the rescue mission will be challenging due to years of governmental inaction and constitutional voids, which led to a deterioration in public sector operations and the accumulation of economic, financial, and monetary crises over the past five years. These challenges were further compounded by a devastating war, which inflicted severe human and financial losses estimated at approximately $10 billion, thereby worsening the country’s financial gap, now estimated at $72 billion.

Economic and banking circles are looking to the new government to swiftly capitalize on extensive international support by restoring trust and reestablishing financial channels between Lebanon and its regional and international partners. Key to this effort are explicit and transparent commitments to combating illegal economic activities, corruption, smuggling, money laundering, and drug trafficking. In parallel, the government must prioritize strengthening judicial independence and implementing strict controls over land, sea, and air borders.

The national consensus evident in the presidential election, according to Mohammad Choucair, head of Lebanon’s economic associations, paves the way for constructive collaboration among political factions. This collaboration is crucial for addressing challenges, rebuilding the state, and benefiting from renewed international and Arab—particularly Gulf and Saudi—interest in Lebanon. Choucair emphasized the importance of normalizing relations with Gulf nations, supporting Lebanon’s recovery, and providing resources for reconstruction efforts.

One of the urgent tasks for the new government, according to the financial official, is revisiting the draft 2024 state budget, which was previously submitted to parliament. Adjustments are necessary to address fundamental discrepancies in expenditure and revenue projections, taking into account significant changes brought about by the Israeli war.

Ibrahim Kanaan, chairman of the Parliamentary Finance Committee, described the budget as “unrealistic, if not entirely fictitious,” particularly in its revenue estimates. He pointed out that revenue increases were based on income and capital taxes, internal duties, and trade-related fees, all of which have been severely impacted by the war.

Reassuring depositors, both domestic and expatriate, who have suffered massive losses over recent years, is another pressing issue. These losses were exacerbated by the inability of successive governments to implement a comprehensive rescue plan addressing the $72 billion financial gap fairly. The situation was worsened by mismanagement in the electricity sector and the squandering of over $20 billion in central bank reserves following the onset of the financial crisis.

In response to Aoun’s commitment to a fair resolution for depositors, the Association of Banks in Lebanon welcomed his emphasis on safeguarding deposits. It also expressed its readiness to collaborate with the central bank and the government to protect depositors’ rights, citing a recent State Council ruling that prohibits any financial recovery plans from including measures that would erode depositors’ funds.

In its final session, the caretaker government addressed long-standing creditor issues by unanimously agreeing to suspend Lebanon’s right to invoke statutes of limitations on claims by foreign bondholders under New York law. This suspension, effective until March 9, 2028, aims to facilitate future negotiations.

With this decision, the caretaker government tacitly acknowledged Lebanon’s pending debt obligations, including over $10 billion in suspended interest payments on Eurobonds and approximately $30 billion in principal debt. The resolution now awaits direct negotiations under the new administration, which faces the challenge of resolving a nearly five-year-old crisis triggered by the previous government’s uncoordinated decision to halt payments on all Eurobond obligations through 2037.

Caretaker Finance Minister Youssef Khalil emphasized that despite the difficult circumstances, “Lebanon remains committed to reaching a fair and consensual resolution regarding the restructuring of Eurobond debt.”