Asharq Al-Awsat has learned that Saudi Arabia has extended the authority of its Minister of Finance to grant exemptions from certain provisions of the Government Tenders and Procurement Law in cases where applying those provisions is not feasible under revenue-sharing arrangements.
The three-year extension is intended to encourage innovative financing mechanisms and expand public-private partnerships (PPPs) as part of the Kingdom’s economic transformation.
The revenue-sharing model is a modern contractual approach that enables government entities to collaborate with the private sector in delivering goods or services. Under this model, projects are funded entirely through revenues generated by their operations, rather than through direct allocations from the state budget.
The approach seeks to harness private-sector expertise and achieve maximum value for public funds.
Because some contracts under this model may require adjustments or exemptions from certain procurement rules, the extension authorizes the finance minister to review and approve such exemptions on a case-by-case basis after assessing their necessity and justification.
According to Asharq Al-Awsat sources, the government has also instructed the minister, in coordination with relevant agencies, to explore alternative mechanisms for processing exemption requests before the end of the extension period.
The decision was based on a recommendation from the Council of Economic and Development Affairs, which also tasked the finance ministry with continuing to coordinate with related government entities to ensure that exemptions align with national policy and regulatory frameworks.
Under the law, the Minister of Finance has the authority to approve new contracting and procurement mechanisms, standardized tender documents, and evaluation criteria. The minister may also extend the implementation period of the law by one year if government entities require more time to achieve full readiness for compliance.
The law further authorizes the minister to decide on maintaining exemptions related to Vision 2030 programs, provided that such recommendations are submitted jointly with the Strategic Management Office to the government at least six months before the end of the extension, along with proposals for future oversight.
The Government Tenders and Procurement Law aims to regulate contracting procedures, prevent conflicts of interest, protect public funds, and ensure fair competition and value for money in public projects. It reinforces transparency, integrity, and equal opportunity among bidders, while supporting economic growth and good governance.
To boost these efforts, the government established the Local Content and Government Procurement Authority (LCGPA) to strengthen local industries, increase the national economic impact of public procurement, and promote sustainable development.
