The Rules regulating the licensing and supervision of the activity of regional headquarters of Multinational companies

The following terms and expressions shall have the meanings assigned to each of them, unless the context requires otherwise:

Kingdom: Kingdom of Saudi Arabia.

Ministry: Ministry of Investment.

Minister: The Minister of Investment.

The Rules: The Rules regulating the licensing and control of the activity of regional headquarters of Multinational companies.

​The activity of the regional headquarters of Multinational companies: It is the strategic supervision, administrative guidance and support of the internal work of the branches of Multinational companies and their owned companies in the region.

Region: MENA region.

Multinational Company: It is the foreign multinational company whose head office is not established in accordance with the Saudi Companies Law, including Gulf companies whose owners do not have a nationality from the Gulf Cooperation Council countries, and companies whose head office is in the region and has another entity that practices the activity of the regional headquarters in the region at least.

Foreign Multinational Company: A company that has at least two branches or subsidiaries around the world other than the Kingdom of Saudi Arabia and the country of incorporation.

Regional Headquarters: A company or branch of the Multinational company established in accordance with the Saudi Companies Law to practice the activity of the regional headquarters of Multinational companies in the Kingdom.

Control: The direct or indirect ability or capacity to exert effective influence over the actions and decisions of another person.

Subsidiary: A company that is wholly owned or controlled by the Multinational Company.

License Applicant: The Multinational company requesting a license to practice the activity of the regional headquarters of Multinational companies by the Ministry.

Licensing: A document issued by the Ministry allowing the practice of the activity of the regional headquarters of Multinational companies.​​

This regulation shall apply to the following: 

1- License Applicant.

2-  Regional headqu​arters licensed by the Ministry.​

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The regional headquarters that obtains the license shall be subject to all applicable laws, regulations, and the like in the Kingdom, with the exception of what is stated in a special text for the regional headquarters, and it shall abide by them permanently and continuously.​

1- A committee shall be formed by a decision by the Minister to consider violations by regional headquarters of the provisions of the rules. It may take the measures provided for in this article against non-compliant regional headquarters.
2- The Ministry shall notify the regional headquarters when the regional headquarters does any of the following:
A. Failure to complete the procedures related to the basic requirements for establishing the company or the branch within six months from the date of obtaining the license.
B. Not to start activating the compulsory or optional activities of the regional headquarters or employing the minimum number of employees within the period of time specified in Article (8) of this regulation.
C. Stop practicing one of the compulsory activities or optional activities listed in the license application, without obtaining the prior approval of the Ministry.
D. Failure to meet any of the statutory requirements for licensing.
E. Any of the staff of the regional headquarters shall carry out the activities of the regional headquarters from outside the Kingdom.
F. Carrying out any of the employees of the regional headquarters for activities outside the scope of activity of the regional headquarters of Multinational companies mentioned in Article 7 of the Rules.
G. The regional headquarters shall raise or update trademarks that are not affiliated with the Multinational company in the trademark register at the Ministry, or in the event that they are amended and the regional headquarters does not inform the Ministry of this.
3- The Ministry shall suspend the license if the regional headquarters does not correct the violations described in the warning issued by the Ministry under paragraph (2) of this article in accordance with the period specified for correction in the warning notice.
4- The Ministry shall revoke the license when the violations described in paragraph (2) of this article continue and are not addressed within 90 working days from the date of suspension of the license.
 5- When suspending or canceling the license, the Multinational company to which the suspended or canceled regional headquarters belongs shall be considered among the companies that do not have a regional headquarters in the Kingdom and shall be subject to the provisions of the controls of contracting government agencies with companies that do not have a regional headquarters in the Kingdom and the relevant parties and their updates.​​​​

A person against whom a decision to violate a grievance has been issued may file a grievance before the competent court within thirty (30) days from the date of notification of the decision.​​​

1- The Ministry shall observe the principle of legislative stability in all regulatory provisions related to the Regional Headquarters (RHQ) activities. Accordingly, the provisions of these rules will not be amended, nor will new provisions be issued that affect existing rights or obligations, except in a manner that achieves a balance between public interest and the protection of the positions of individuals and legal entities. This also ensures clarity of procedures and stability of transactions, in accordance with the laws and regulations approved in the Kingdom of Saudi Arabia.
2- These Rules shall be published in the Official Gazette, and shall come into force from the date of its publication.​​