Saudi Arabia announces contractual exceptions for companies without HQ in Kingdom

Saudi Arabia has made exceptions to the decision to stop contracting with any company that has no headquarters in the Kingdom.

The decision, which was issued in 2021, and will enter into force in early 2024, restricts any contracts with bodies, institutions, and funds affiliated with the government or one of its agencies without having any headquarters in the kingdom.

The exceptions included the absence of more than one offer (i.e. the agent is the best offer after the overall evaluation from a technical point of view, and is financially less than 25% or more than the value of the second best offer.

According to the controls set by the Kingdom; works and purchases whose estimated cost does not exceed one million riyals or that are carried out outside the Kingdom are excluded from the ban.

The recent controls added that government agencies may not invite companies that do not have a regional headquarters in the Kingdom or any related party to participate in the limited competitions they offer, except in two cases. They are the absence of more than one qualified competitor other than companies that do not have a regional headquarters in the Kingdom or related parties to carry out the business or secure the required purchases.

The second case is the existence of an emergency situation that can only be dealt with by inviting companies that do not have a regional headquarters in the Kingdom or from the relevant parties.