RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/ACC/SPEC/SAU/4/Rev.3 
27 January 2004 
 (04-0284) 
Working Party on the Accession  
of the Kingdom of Saudi Arabia  
 
 
 
DRAFT REPORT OF THE WORKING PARTY ON 
THE ACCESSION OF THE KINGDOM OF SAUDI ARABIA 
TO THE WORLD TRADE ORGANIZATION 
Revision  
  WT/ACC/SPEC/SAU/4/Rev.3 
 Page i 
 
 
 TABLE OF CONTENTS 
INTRODUCTION ............................................................................................................................... ...1 
DOCUMENTATION PROVIDED ......................................................................................................1  
ECONOMIC POLICIES .......................................................................................................................9  
Monetary and Fiscal Policies ................................................................................................................9  
Taxation and Zakat ..............................................................................................................................1 0 
Foreign Exchange and Payments ........................................................................................................11  
Competition Policies ............................................................................................................................12  
Pricing Policies ............................................................................................................................... ......13  
Privatization ............................................................................................................................... ..........14  
State-Owned Enterprises .....................................................................................................................17  
Investment Regime ............................................................................................................................... 18 
FRAMEWORK FOR MAKING AND ENFORCING POLICIES .................................................25  
POLICIES AFFECTING TRADE IN GOODS ................................................................................31  
Trading Rights (The Right to Import and Export) ...........................................................................31  
IMPORT REGULATION ...................................................................................................................35  
Tariff Rate Quotas and Tariff Exemptions .......................................................................................36  
Other Duties and Charges ...................................................................................................................37  
Fees and Charges Connected with Im portation (for Services Rendered) .......................................37  
Import Licensing Systems ...................................................................................................................38  
Quantitative Import Restrictions, Including Prohibitions and Quotas ..........................................45  
Customs Valuation ............................................................................................................................... 46 
Rules of Origin ............................................................................................................................... ......49  
Other Customs Formalities .................................................................................................................50  
Other Border Measures .......................................................................................................................50  
Application of Internal Taxes .............................................................................................................51  
Anti-Dumping, Countervailing and Safeguard regimes ...................................................................51  
EXPORT REGULATIONS ................................................................................................................52  
Export Restrictions ..............................................................................................................................5 2 
Export Duties ............................................................................................................................... .........53  
Export Subsidies ............................................................................................................................... ....53  
INTERNAL POLICIES AFFECTING TRADE IN GOODS ..........................................................53  
Industrial Policy, Including Subsidies ................................................................................................53  
Technical Barriers to Trade ................................................................................................................54  
Transparency ............................................................................................................................... .........61  
Implementation of TBT Agreement Obligations ..............................................................................62  WT/ACC/SPEC/SAU/4/Rev.3 
Page ii  
 
 Preshipment Inspection
.......................................................................................................................62  
Sanitary and phytosanitary measures ................................................................................................64  
Trade Related Investment Measures ..................................................................................................71  
State Trading ............................................................................................................................... .........72  
Free Zones ............................................................................................................................... .............72  
Trade in Transit ............................................................................................................... ....................73  
Agricultural Policy ............................................................................................................................... 73 
Trade in Civil Aircraft .........................................................................................................................75  
Trade Related Intellectual Property Regime .....................................................................................76  
General ............................................................................................................................... ...................76  
Industrial Property Protection ...........................................................................................................76  
Agencies Responsible for Policy Formulation and Implementation ...............................................76  
Membership in International Intellectual Property Conventions ...................................................77  
Application of MFN and National Treatment to Foreign Nationals ...............................................77  
Fees and Taxes ............................................................................................................................... .......77  
Trade Marks, Including Service Marks .............................................................................................77  
Substantive Standards of Protection, Including Procedures for the Acquisition and 
Maintenance of Intellectual Property Rights .......................................................................78  
Copyright ............................................................................................................................... ...............78  
Patents  .............................................................................................................................. ....................79  
Trademarks ............................................................................................................................... ...........80  
Geographical Indications, Including Appellations of Origin ...........................................................80  
Industrial Designs ............................................................................................................................... .81 
Layout Designs of Integrated Circuits ...............................................................................................81  
Plant Variety Protection ......................................................................................................................81  
Undisclosed Information .....................................................................................................................81  
Enforcement ............................................................................................................................... ..........81  
POLICIES AFFECTING TRADE IN SERVICES ...........................................................................82  
Government Procurement ...................................................................................................................89  
Transparency ............................................................................................................................... .........89  
Notifications ............................................................................................................................... ...........91  
Trade Agreements ............................................................................................................................... .91 
CONCLUSIONS ............................................................................................................................... ...92 
 
  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 1 
 
 
 INTRODUCTION  
1. On 13 June 1993, the Government of the Kingdom of Saudi Arabia (hereinafter referred to as 
Saudi Arabia) requested accession to the General  Agreement on Tariffs and Trade (GATT 1947).  At 
its meeting on 21 July 1993, the GATT 1947 Council of Representatives established a Working Party 
to examine the application of the Government  of Saudi Arabia to accede to the General  Agreement 
under Article XXXIII, and to submit to the Counc il recommendations which may include a draft 
Protocol of Accession.  Membership of the Work ing Party was open to all contracting parties 
indicating the wish to serve on it.  In pursuance of  the decision of the General Council of the World 
Trade Organization (WTO) of 31 January 1995, the GATT 1947 Accession Working Party was transformed into a WTO Accession Working Party.  The terms of reference and the membership of 
the Working Party were reproduced in document WT/ACC/SAU/2/Rev.17. 
2. The Working Party met on 2 and 3 May; 6 and 8 November 1996; 29-30 May; 2 and 
4 December 1997; 17 and 19 November 1998; 22 Se ptember 1999; 5 April 17 October 2000; and 
23 October 2003 under the Chairmanship of H.E. Ambassador Mr. J. Weekes (Canada), and on 23-24 October 2003 and [...] under the Chairmanship of H.E. Ambassador Mr. Munir Akram 
(Pakistan). 
DOCUMENTATION PROVIDED
 
3. The Working Party had before it, to serve as a basis for its discussions, a Memorandum on the 
Foreign Trade Regime of Saudi Arabia (L/7489)  and the questions submitted by members on the 
foreign trade regime of Saudi Arabia, together  with the replies thereto, (L/7645 and Add.1; 
WT/ACC/SAU/3; WT/ACC/SAU/6, Add.1-3 and Add.3/Corr.1; WT/ACC/SAU/8 and Corr.1; WT/ACC/SAU/10; WT/ACC/SAU/13, Add.1, Add.1/Corr.1 and Rev.1; WT/ACC/SAU/29, Add.1-4, and Corr.1 and 2; and, WT/ACC/SAU/35 and Corr.1) .  The Government of Saudi Arabia also 
provided the Working Party with information regarding the following: 
Economic Development Plans
 
- Sixth Development Plan, Decree No. 142 of 19/11/1413 (10 May 1993) 
- Seventh Development Plan, Decree No. 126 of 28.05.1421 (29 August 2000) 
Economic Policies  
- Pricing Policies  
- Council of Ministers Resolution of November 1992 WT/ACC/SPEC/SAU/4/Rev.3 
Page 2  
 
 - Council of Ministers Resolution No. 19756/R dated 21/11/1422 (4 February 2002) 
(cancelling Council of Ministers Resolution of November 1992) 
- Privatization  
- Economic Reform Program of the Kingdom of Saudi Arabia, WT/ACC/SAU/54 
(4 April 2003) 
- Council of Ministers Resolution No. 60 of 1.4.1418H (1997) 
- Council of Ministers Resolution No. 257 dated 11.11.1421H (5 February 2001) 
- Royal Approval issued in 1417 (1997) 
- Council of Ministers Resolution issued in 1419 (1999) 
- Council of Ministers Resolution 169 of 11/8/1419 (30 November 1998) 
- Investment Regime  
- New Foreign Investment Law, replacing the Foreign Capital Investment Law, 
promulgated by Royal Decree No. M/1 of 9 April 2000 (5.1.1421 H) 
- "Negative List" (issued by Supreme Economic Council Decision No. [...] under 
Article 3 of the Foreign Investment Law) 
- Implementing Regulations for Royal Decree No. M/1 of 9 April 2000 (issued 
24 June 2002) 
- First Foreign Investment Law, 1979 
- Capital Market Law, issued under Royal Decree No. M/30, dated 02.06.1424 H 
(13 July 2003) 
- Council of Ministers Decision No. 50,  dated 21.4.1415 (27 September 1994) 
- Council of Ministers Bureau Letter 8/490, dated 28.6.1414 (13 December1993) 
- Guide to the Licensing of Foreign Investment in Saudi Arabia 
- Information on Foreign Investment by Sectors 
- Information on Recent Foreign Investments Granted Licenses 
Framework For Making and Enforcing Policies  
- Basic Law of Government, Royal Decree No. A/90 dated 27 Shaaban 1412 H 
(1 March 1992) 
- Consultative Council Law 
- Council of Ministers Law 
- GCC Common Customs Law and its Rules of Interpretation 
- Commercial Register Law and its Implementing Regulations 
- Commercial Agencies Law and its Implementing Regulations 
- Companies Law and its Implementing Regulations 
- Law on Import Licensing Procedures and the Import Licensing Guide 
- Combat of Commercial Fraud Law and its Implementing Regulations 
- Negotiable Instruments Law and its Implementing Regulations 
- Trade Names Law and its Implementing Regulations 
- Board of Grievances Law of 17.1.1402 H (14 November 1981) 
- Council of Ministers' Resolution No. 165 dated 24.6.1423 H (1 September 2002) 
Policies Affecting Trade in Goods  
- Trading Rights  
- Law on Commercial Names issued pursuant to Royal Decree No. M/15 dated 
12/08/1420 H (20 November 1999) and the associated rules and regulations  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 3 
 
 
 - Professional Companies Law 
- Customs Tariffs  
- Customs Law and Implementing Regulations 
- Customs Tariff 
- Import Licensing Systems  
- Council of Ministers Decision No. 84 (July 2000) 
- The Import Licensing Law issued vide Council of Ministers Decision No. 88 of 
6.4.1432H (July 2002) 
- Telecommunications Act, Article 39 
- Information on the Application of Import Licensing 
- Information on Preferential Trading Arrangements 
- Response to Questionnaire on Import Licensing Procedures 
- Quantitative Import Restrictions, Including Prohibitions and Quotas  
- Ministry of Commerce and Industry Decision No. 1308, dated 27.5.1424H 
(27 July 2003) 
- Customs Valuation  
- Royal Decree No. 190 dated 16 Dhu Al-Hujah 1409H (19 July 1989) 
- Royal Decree No. 425 dated 5/3/1372H (22 November 1952) 
- Response to Questionnaire on Customs Valuation Procedures 
- Other Customs Formalities  
- Council of Ministers Order No. 5, dated 3.01.1406H (10 September 1985) 
Internal Policies Affecting Trade in Goods  
- Industrial Policy, Including Subsidies  
- Saudi Industrial Development Fund Law 
- Technical Barriers to Trade  
- List of SASO standards that had been b ased upon CODEX standards, together with a 
complete list of the 1,323 Saudi standards including a cross-reference to the 
international standards adopted in their entirety as SASO standards, WT/ACC/SAU/34 
- List of standards deemed to be equiva lent to Saudi standards, WT/ACC/SAU/15 
- SASO standards, adopted as GCC Standards and thereby incorporated as national 
standards in other GCC Countries, WT/ACC/SAU/29 (Annex III) 
- Procedures for the development of SASO  standards, WT/ACC/SAU/29 (Annex IV) 
- Comprehensive Guidelines and Procedures concerning the ICCP 
- Appeals procedures, included as an Appendix to the ICCP Guidelines 
- Saudi Conformity Assessment Program  
- SASO Comprehensive Directive of July 2000 (circulated to Working Party members 
in October 2000) WT/ACC/SPEC/SAU/4/Rev.3 
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 - Regulated Product Categories Applicable Standards 
- Pre-shipment Inspection  
- Council of Ministers Decision No. 213 da ted: 3.8.1424H (30.9.2003) cancelling the 
ICCP 
- Sanitary and Phytosanitary Measures  
- Shelf life of food products, WT/ACC/SAU/27 
- Council of Ministers Decision No. 109, dated 34.4.1424H (30 June 2003) 
- Council of Ministers Decision No. 85, dated 01.04.1421H (04 July 2000) 
- Agricultural Policy  
- Tables on domestic support and export s ubsidies, WT/ACC/SAU/19 and 28; and 
WT/ACC/SPEC/SAU/1/Rev.6 and Corr.1 
- Royal Decree No. 58 issued on 3/12/1382 founding the Saudi Arabian Agricultural 
Bank 
- Royal Decree No. 4/B/49434, dated 8.12.1423H (10 February 2003) 
- Trade Related Intellectual Property Regime  
- The Law for the Protection of Copyrights (Old) 
- New Copyright Law Issued vide Council of Ministers' Decision of 9 June 2003 
- Trade Marks Law  
- Council of Ministers' Decision No. 140 of 5 August 2002 (New WTO-consistent 
Trade Marks Law) 
- Companies Law 
- Labour Law 
- Banks Control Law 
- Geographical Indications Law 
- Copyright Law 
- GCC Patent Law 
- Saudi Patent Law 
- Policies Affecting Trade in Services  
- Council of Ministers Resolution No. 190 of 16.11.1409 H (concerning Rules and 
Procedures to be Followed by the Board of Grievances and the Board of Grievances Law) 
- Law of Residency 
- Labour and Workers Regulations 
- GCC Documents  
- Unified Economic  Agreement, signed 11 November 1981 under the Gulf Cooperation 
Council 
- Information on Non-Oil Exports to  Gulf Cooperation Council States 
- Rules for the Coordination of Industrial Establishments in the Gulf Cooperation 
Council States 
- Standard Rules for Giving Priority in Government Purchases to National Products 
and Products of National Origin of Gulf Cooperation Council States  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 5 
 
 
 - GCC Common External Tariff 
- Domestic Development Measures and Documents  
- Law for the Protection and Encouragement of National Industries 
- Saudi Industrial Development Fund Law 
- Banking Control Law (Articles 1-4) 
- Information on Saudi Industrial Development Fund Loans 
- Information on Saudi Agriculture Bank Loans 
- Information on Agricultural Subsidies Disbursed through the Agriculture Bank 
- Information on Agricultural Domestic Support 
- Sector-Specific Measures  
- Ministerial Resolution by the Ministry of Communications concerning Applications 
for Licenses by Maritime Companies and Firms for Carrying on Maritime Carriage (Articles 1-7) 
- Ministerial Resolution No. 4104/20/M date d 4.11.1408 H (18 June 1988) concerning 
the Implementing Regulations to the Private Medical Establishments Law 
(Articles 1-2) 
- Implementing Regulations to Regulation of Technical Institutes and National 
Occupational Centres (Articles 1-9) 
- Resolution from His Royal Highness the Minister of Defence and Aviation 
concerning the Regulation of Tourism and Travel Agencies and Companies engaged 
in Air Transport (Articles 1-4 and 13) 
- Ministerial Order No. 264 of 16.9.1402H (7 July 1982):  Organization of the Practice 
of the Profession of Engineering Consultancy (Party I and III) 
- Law of Certified Accountants (Articles 1-2) and Ministerial Order No. 595 of 
13.11.1395 (16 November 1975) enacting the Implementing Regulations of the Accountants Law 
- Ministerial Order No. 1190 of 16.2.1402 (13 December 1981) Pertaining to the 
Regulation of Carrying on the Profession of Legal Consultancy (Articles 1-2. 4-7) 
- Law concerning the Carrying on of the Profession of Pharmacy and Trading in 
Medicaments and Medical Preparations (Articles 1.5) 
- Government Purchases Law and Implementing Regulations 
- Grievance/Dispute Measures  
- Rules and Procedures of the Board of Grievances 
- Law of Arbitration and Implementing Re gulations to the Law of Arbitration 
- Other Measures and Documents  
- Import Statistics 
- Royal Decree M/10 of 3.3.92 H (16 April 1972) and Council of Ministers Resolution 
No. l 172 of 25.2.92 H (9.4.1972) 
- Council of Ministers Resolution No. 124 of 29.5.1403 (13 March 1983) 
4. The representative of Saudi Arabia stated that over the last 30 years, Saudi Arabia had 
become a State with a strong economy increasingly b ased on the private sector with a sophisticated 
infrastructure.  At the same time, government initia tives had been used to influence economic activity WT/ACC/SPEC/SAU/4/Rev.3 
Page 6  
 
 when necessary, in order to ensure the protection of  the Islamic values of Saudi Arabian society.  
Economic development of Saudi Arab ia had largely depended on the utili zation of its large oil and gas 
reserves.  Saudi Arabia was the largest producer of  oil in the world and one of the world's largest 
producers of natural gas.  The availability of these resources had given rise to an economy typical of oil-producing developing countries characterized by  a major concentration of exports on a single 
exhaustible resource and a high propensity to import. 
5. The representative of Saudi Arabia inform ed members of the Working Party that 
Saudi Arabia had adopted free market principles ensu ring that private enterprise would always be the 
main focus of economic activity, and established an  indicative planning approach to economic and 
social development based on Islamic values and principles, which guide the development in a 
coordinated and balanced direc tion.  Economic indicative planning in the Kingdom provided an 
appropriate conceptual, practical and organizationa l framework for the development process, with all 
of its economic, social and institutional dimensions .  In addition to the underlying objectives of the 
preservation of Islamic values and the provision of national security, the consecutive five-year indicative plans aspired to achieve a number of ot her broad goals.  These incl uded diversification of 
the economy, particularly through laying more em phasis on industry and agriculture, and developing 
mineral resources, improvement of living standard s and quality of life, achievement of balanced 
growth throughout all regions of the Kingdom, stre ngthening the role of the private sector, through 
encouraging its participation in various socio-economic development projects, achievement of social 
and economic integration among GCC countries, and support economic c ooperation with other 
countries.  Other objectives include development and sustenance of the country's physical infrastructure, protection of the environment a nd development and utilization of human resources 
through increasing the absorptive capacity of educationa l institutions.  The First and Second Plans laid 
the foundation for the Kingdom's rapid transformation into a modern industrialized state, focusing on 
the provision of basic infrastructure, improved government services and the establishment and 
expansion of supporting institutions .  Rapidly rising oil revenues during the period covered by these 
two Plans, further helped to accomplish their objec tives including the creation of jobs in both public 
and private sectors.  The Third and Fourth Plans emphasized the diversification of the economy by 
concentrating on the completion of major infrastructure projects to meet the rapidly increasing 
demand for improved educational, health, training a nd other social services, and by encouraging the 
growth of the private non-oil sector.  The Fifth De velopment Plan enhanced and broadened the main 
objectives of the previous plans, through appropria te regulatory policies and support measures.  It 
accorded highest priority to the private sector 's role in accelerating the process of economic 
diversification.    WT/ACC/SPEC/SAU/4/Rev.3 
 Page 7 
 
 
 6. He further recalled that the Sixth Developmen t Plan, continued to enhance and broaden the 
main objectives of the previous development plans.  It set out to meet the Kingdom's development 
needs through maximizing the private sector's contribution in the provision of jobs, diversifying the 
economy to lessen its dependence on oil, building new physical infrastructure, improving social services, expanding job opportunities for the Saudi labour  force, raising the per-capita income of the 
population and maintaining a balanced budget over th e Plan's period.  The development of the 
country's scientific and technological capabilities and the protection of the environment against 
pollution as well as the preservation of the country's natural resources, were also among the general 
objectives of the Sixth Plan, and later plans .  Over the past three d ecades, non-oil GDP increased 
more than five-fold and private investment incr eased seven-fold.  Infant mortality rates dropped by 
over 80 per cent; the ratio of physicians per person improved by more than 95 per cent.  Over the 
same period, school enrolment rose from 600,000 to more than 4.7 million and Saudi Arabia had 
among the lowest pupil-teacher ratios in the world. 
7. The representative of Saudi Arabia further adde d that Saudi Arabia had also improved its 
trade with other nations of the world.  In 2003,  he reported, Saudi Arabia was the world's 25
th-largest 
importer/exporter, with a foreign investment balance of US$78 billion.  The Kingdom's gross 
domestic product grew fromUS$20 billion in 1970 to US$190 billion in 2002.  Also, he stated, Saudi Arabia maintained one of the least restrictiv e exchange and trade systems in the world.  There 
were no exchange restrictions and no trade rest rictions were imposed for balance-of-payments 
reasons.  Indeed, currently trade restrictions we re only imposed for religious, health or security 
reasons. 
8. Members of the Working Party asked Saudi Arabia to provide information regarding the most 
recent Development Plans.  In response, the repr esentative of Saudi Arabia noted that the Seventh 
Development Plan, Decree No. 126 of 28.05. 1421 (29.08.2000), covered the years 2000 through 
2004.  The Plan focused on increasing the size and strength of the private sector, and developing 
Saudi Arabia's human resources.  In addition, the Plan emphasized increasing the level of efficiency 
of Saudi Arabia's industrial sector.  As with prior pl ans a primary goal of the seventh Plan had been to 
diversify as well as grow Saudi Arabia's economy. 
9. The representative of Saudi Arabia also descr ibed aspects of the Eighth Development Plan, 
covering the years 2005-2009, which was still being prepared.  He noted that, under the Plan, Saudi Arabia would continue to focus on higher growth rates and increasing investment, foreign as 
well as domestic.  As with the previous Plan, Saudi  Arabia would continue to develop its human 
resources.  The Eight Development Plan would likely have additional emphasis on commitment to a WT/ACC/SPEC/SAU/4/Rev.3 
Page 8  
 
 long-term development strategy linked to time fram es and quantitative objectives.  This aspect of the 
Plan, he said, would allow Saudi Arabia to measu re its progress and ensure that its policies were 
appropriate and were assisting th e Kingdom in achieving its goals. 
10. The representative of Saudi Arabia stated that  the diversification of the economy could only 
be achieved through much broader private sector par ticipation in the economy.  The private sector had 
already begun to pursue a wide range of business opportunities unrelated to government expenditures 
and this trend was expected to accelerate as pr ivate sector management, production and marketing 
capabilities strengthened and the competitive atmosphe re improved.  Institutional support for private 
sector-led growth and diversification would be provided by the Government, through liberalization 
and facilitation of investment and ra pid development of Saudi Arabia's  financial sector.  Saudi Arabia 
also recognized the need to build a technology base.   Whilst Saudi Arabia had kept up to date with 
global scientific and technological developments, this had largely been through the import of 
sophisticated technology owned by foreign partne rs.  Saudi Arabia still needed to improve its 
indigenous technological capabilities to the level of  that existing in developed countries.  The 
Government planned to assist through the expans ion and improvement of educational courses and 
facilities related to science and technology at a ll levels, as well as improvement of the overall 
structural support for private sector initiatives.  In addition, Saudi Arabia was aware of the need to 
impart to its citizens the knowledge and skills that w ould enable them to participate effectively in all 
social, economic and cultural activities, as well as to further develop vocational and technical 
education so that the country's skilled manpower needs could be met. 
11. In their opening remarks, members of the Working Party welcomed Saudi Arabia's decision 
to accede to the WTO and to implement the WTO  Agreements expeditiously through the 
establishment of institutional arrangements and the amendment and adoption of the required 
legislation and regulations.  It was noted that Saudi  Arabia had played and was expected to continue 
to play a significant role in contributing to main tain economic and financia l stability and growth, both 
in the region and globally.  Saudi Arabia's accession would reinforce the universality of the WTO and 
strengthen the multilateral trading system. 
12. The Working Party reviewed the economic polici es and foreign trade regime of Saudi Arabia 
and the possible terms of a draft Protocol of Accession.  The views expressed by members of the 
Working Party and the various aspects of Saudi Arab ia's foreign trade regime, and on the terms and 
conditions of Saudi Arabia's accession to the WTO,  are summarized below in paragraphs 11 to [...].  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 9 
 
 
 ECONOMIC POLICIES  
Monetary and Fiscal Policies  
13. The Saudi Arabian Monetary Agency (SAMA) is charged with carrying out the Kingdom's 
monetary policy.  The objective of monetary po licy is the maintenance of domestic price and 
exchange rate stability.  To promote domestic price stability, SAMA takes measur es to ensure that the 
growth in domestic liquidity is broadly in line w ith the growth and availability of goods and services 
in the economy and the banking system is endowed with  adequate liquidity so that the credit needs of 
all the sectors of the economy are adequately met.  For maintaining the stability of the fixed exchange 
rate, SAMA monitors the Riyal market to ensure  its smooth functioning and takes corrective measures 
if there are any disruptive activities.  SAMA h as been highly successful in achieving these objectives 
over the years.  The domestic price situation has re mained highly stable for years, with the average 
annual increase in the cost of living index recordi ng an average rise of less than one per cent per 
annum over the last two decades.  The exchange rate  of the Riyal vis-à-vis the U.S. dollar has also 
been maintained at SAR 3.75 per U.S. dollar sin ce 1986.  The sustained stability in domestic prices 
and the exchange rate over a prolonged period of tim e has greatly facilitated the growth process of the 
Saudi economy. 
14. The primary objective of Saudi Arabia's fiscal policy is to broadly encourage economic 
growth and thereby create new and more diverse j ob opportunities.  This, in turn, will contribute to 
living standards.  To accomplish these goals, Saudi  Arabia will direct government expenditures 
towards the expansion and diversification of the economic base and educational opportunities and 
towards improving public services. 
15. One of the keys of the fiscal policy involves increasing economic diversification.  By 
diversifying the economy and reducing Saudi Arabia's reliance on petroleum production, 
Saudi Arabia is committing to long-term economic growth not dependent on petroleum.  This will 
strengthen the Saudi Arabian economy in the present as well as for the long-term future.  In addition, 
by encouraging the development of non-petroleum sect ors, Saudi Arabia will, of necessity, speed its 
integration into the global economy by increasing its  participation in sectors on which other countries 
have focused, i.e., the technology and communications sectors, as well as the basic industrial sectors.  
This also will yield significant related benefits , such as strengthening Saudi Arabia's technical 
infrastructure and capacity.  It also will help Sa udi Arabia develop a broader base of skills and 
expertise in the Saudi work force and strengthen a nd diversify Saudi educati onal institutions, both of 
which are exceedingly important aspects of Saudi's long-term economic development.  These WT/ACC/SPEC/SAU/4/Rev.3 
Page 10  
 
 capacities must be strengthened to allow Saudi Arab ia to compete successfully in the long term in 
global markets. 
16. Saudi Arabia's accession to the WTO, though not tied directly to its fiscal policy,  is 
exceedingly important to achieving the goals of th e policy.  By undertaking the reforms necessary for 
accession, Saudi Arabia already has vastly improved the climate not merely for foreign investment and trade, but also for domestic investment and tr ade.  These reforms, in and of themselves, are 
increasing Saudi Arabia's ability to achieve its deve lopmental goals.  Saudi Arabia anticipates that 
accession, when realized, will result in further benefits. 
17. The national budget for 2003 projects revenues of  SAR 170 billion and expenditures of SAR 
209 billion, resulting in an estimated SAR 39 billion deficit.  The budget estimates represented increases of 8.3 per cent and 3.5 per cent in total revenue and total expenditure respectively from 
those in the preceding year that placed revenue at SAR 157 billion, expenditure at SAR 202 billion 
and deficit at SAR 45 billion.  The deficit of  SAR 39 billion would be covered through domestic 
borrowing.  The policy objective in 2002 was to achie ve a balanced budget.  However, that objective 
was not achieved because of the drop in oil pr ices and the increase in the payroll where the 
government paid 13-month salaries instead of 12 month salaries per annum due to the transfer from 
the Hijri calendar to the Gregorian calendar. 
Taxation and Zakat
 
18. Some members of the Working Party requested information on "Zakat" applied to 
Saudi Arabian citizens and income tax applied to foreigners.  These members noted that it appeared 
that the Zakat and income tax were applied in such  a manner that foreign investors typically carried a 
higher total tax burden than Saudi citizens.  The repr esentative of Saudi Arabia stated that there was a 
general misunderstanding about  Zakat and income tax.  It was not correct to say that the tax burden 
(as distinct from the nominal rates) was higher fo r foreigners than for Saudi nationals or Saudi 
companies.  The percentage of tax to net profit of a non-Saudi did not exceed 30 per cent, while the 
percentage of Zakat may reach or even exceed 100 per cent of net profit.  Zakat was a religious tax.  
Because its rate and basis of collection was prescr ibed by religion, it could not be altered. 
19. According to the representative of Saudi Arab ia, the main features of Zakat were the 
following: 
- Zakat was applied at a flat rate of 2.5 per cent on the total assets of Saudi natural 
persons, wholly Saudi-owned companies and Saudi partners in joint ventures (except  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 11 
 
 
 for rain-fed agricultural products and irri gated agricultural products, for which the 
rate was 10 per cent and 5 per cent, respectively). 
- The base for levy of Zakat, i.e., the assessable amount, was not the income or profits 
of the assessee.  It was much larger and included: capital, statutory reserves, 
circulated profits, partners' credit account for one year or longer (treated as capital), 
loans from partners (treated as capital and additional financing for the company), and 
long-term loans from other sources for the purpose of capital base expansion.  There 
were no exemptions. 
- Zakat was payable even if the company did not make a profit. 
- Zakat was payable even if the company ceased its activities; it was non-payable only 
when the company was liquidated. 
20. In contrast, he noted, income tax and corporate tax had the following features: 
- The maximum rate of corporate tax on net profit had been reduced from 45 to 
30 per cent, and now stood at 20 per cent as per Council of Ministers Decision on 12.1.2004. 
- Income tax was payable by foreign natura l persons, foreign pa rtners and foreign 
shareholders in business entities on their ne t income.  However, wages and salaries 
were exempt from taxation. 
- Corporate tax was payable by non-Saudi cor porations operating inside Saudi Arabia 
or both inside and outside of Saudi Arabia at the same time based on: (i) the total share of foreign partners in the net prof its of Saudi corporations (limited liability 
companies and joint stock companies); and (ii)  the total shares of foreign partners in 
the net profit of Saudi partnerships. 
- Corporate tax was payable on net profit ( unlike Zakat, which was payable on total 
assets). 
- Unlike Zakat, corporate tax was not payable in relation to any year in which the 
company did not make a profit or was not in operation. 
- There was a provision for carry forward of losses for unlimited number of years. 
Foreign Exchange and Payments  
21. The exchange rate policy of the Kingdom has fo r a long time been geared to maintaining a 
stable relationship with the U.S. dollar, which is th e intervention currency.  As already mentioned, the 
exchange rate of the Riyal has been kept unchange d at SAR 3.75 to the dollar since 1986.  This has 
created a stable exchange rate environment for the private sector and has also been conducive to 
foreign investment. 
22. The exchange rate of the Riyal is determined  by SAMA in light of the economic, trade and 
balance of payments situation both at home a nd abroad.  Until the end of 2002, the Riyal was 
effectively (informally) anchored to the U.S. dollar,  within the framework of an official link to the 
SDR.  In pursuance of a decision taken by the GCC heads of states in December 2001, the Riyal, 
along with other GCC currencies, has become offici ally (formally) pegged to the U.S. dollar as from 
the beginning of 2003 in preparation for the monetary union and the single currency for the GCC countries by the year 2010.  The choice of U.S. dollar to serve as a common denominator is based on WT/ACC/SPEC/SAU/4/Rev.3 
Page 12  
 
 the fact that the U.S. dollar is the intervention currency for all the GCC countries and their foreign 
reserves for currency cover and balance of paymen ts purposes are largely held in U.S dollars.  
Moreover, a stable relationship with the U.S. do llar is of crucial importance not only for fiscal 
management but also for the traders in their business planning.   
23. Since the early 1960s, when Saudi Arabia unde rtook the obligations of convertibility under 
Article VIII of the Articles of  Agreement of the IMF, the Saudi Riyal has remained fully convertible, 
with no taxes or subsidies on the purchase and sale of  foreign exchange.  There are no restrictions on 
payments in Saudi Arabia.  Imports, exports, re mittances and capital movements from, or to, the 
Kingdom are free from restrictions.  There are also no controls that have a direct impact on imports, e.g., there are no surrender requirements, prior deposit for importation, import prepayment requirements or acquisition fees. 
24. Saudi Arabia is a market economy with liberal trade and payment policies.  There are no 
restrictions on import and export of goods and services.   Remittances by expatriate workers are also 
free of restrictions.  These totalled US$15.9 billion in  2002, equivalent to roughly 8.4 per cent of the 
nominal gross domestic product (GDP).  There are no restrictions on capital movements.   
25. Saudi Arabia's balance of payments position has improved remarkably over the past few 
years.  The current account has been  in surplus since 1999.  The surp lus has risen from 0.3 per cent of 
GDP in 1999 to 6.3 per cent of GDP in 2002 and is e xpected to rise further in 2003.  Exports of goods 
and services during 2002 amounted to US$ 81.4 billion, approximately 43.2 per cent of GDP.  
Imports of goods and services stood at US$ 53.6 billion, or 28.5 per cent of GDP.  Over the years 
1999-2002, the net foreign assets of SAMA, the central bank of the Kingdom, have increased from US$ 37.9 billion to US$ 42.0 billion.  This amount is  sufficient to cover 9.4 months' of imports of 
goods and services. 
Competition Policies
 
26. The representative of Saudi Arabia stated that , with the exception of certain sectors discussed 
below, Saudi Arabia's competition policies were based on free-market principles.  A draft law on 
competition policy is currently in the legislative process.  The draft Law was currently before the 
Shoura Council; it would then be transmitted to the Council of Ministers.  The draft Law contained 
provisions, inter alia , on cartel and monopoly-type practices, on mergers and on unfair commercial 
practices.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 13 
 
 
 Pricing Policies  
27. Members of the Working Party requested information regarding restrictions on prices 
maintained by the Kingdom of Saudi Arabia.  In r esponse, the representative of Saudi Arabia reported 
that prices for goods and services in every sector in Saudi Arabia were freely determined by market 
forces with the exception of the goods listed at Annex A of this Report, which were subject to price 
regulation within the Kingdom to maintain price st ability.  These policies were pursued to secure the 
needs and welfare of consumers and preserve important social interests of the Kingdom. 
28. The representative of Saudi Arabia further reporte d that the price regulations were applied on 
a non-discriminatory basis, regardless of whether a product or service was supplied by the government or by the private sector and regardless of  the nationality of the supplier.  He confirmed 
that the price controls were applied in a WTO-cons istent fashion and that Saudi Arabia would publish 
the list of goods and services subject to price control requirements, as well as any modifications, in 
the official gazette, the Umm Al-Qura . 
29. In response to a question from a member of  the Working Party, the representative of 
Saudi Arabia stated that all petroleum-based a nd natural gas-based products in the Kingdom were 
made available to industrial users regardless of wh ether the users were Saudi or foreign owned.  
Exports of these products, he confirmed, were based entirely on international market conditions.   He 
further stated that the prices of certain petroleu m-based and natural gas-based products to domestic 
industries and consumers were set in a manner consis tent with WTO rules.   The same prices applied 
to all users in the Kingdom, whether Saudi or non-Saudi.  Therefore, there was no violation of the 
national treatment provisions of Article III of the GATT 1994.  The representative added that the 
Kingdom would ensure that its price control mech anisms conformed to Article III of the GATT 1994 
and the transparency requirements of the WTO. 
30. Some members of the Working Party requested information on the pricing of certain 
feedstock, in particular, methane, ethane, butane, pr opane and natural gas or liquefied petroleum gas.  
In response, the representative of the Kingdom of Sa udi Arabia noted that pricing of natural gas, 
including methane and ethane, was quite different fro m the pricing of butane and propane and natural 
gasoline.  Natural gas was not sold for export and th erefore had no international reference price in the 
Gulf region.  Similarly, there were no exports of  methane or ethane from Saudi Arabia, due to the 
high costs of liquefying, transporting and re-gasify ing such gases.  Previously, methane and ethane 
had been burnt as waste products.  Recently, it ha d been decided to make methane and ethane 
available to all interested users on a non-discrimin atory basis (whether Saudi or non Saudi) currently 
at a price of US$0.75 per million BTU.  This decision was taken based on a combination of WT/ACC/SPEC/SAU/4/Rev.3 
Page 14  
 
 commercial reasons and environmental concerns.  Ra ther than burn valuable natural resources, the 
Kingdom had taken steps to conserve and market t hose resources consistent with WTO disciplines.  
Methane and ethane were used by many industries and sectors, including power companies, 
desalination plants, cement manufactures and petrochemical plants. 
31. The representative of Saudi Arabia originally ha d noted that for butane, propane or natural 
gasoline (NGLs), the Council of Ministers Resolu tion of November 1992 set prices lower than the 
export prices.  This was done to take account of the costs associated with NGL exports to world 
markets, including refrigerating, storage, mooring a nd marketing.  The products were available to all 
industries and all users within the Kingdom whethe r Saudi or non-Saudi.  All other products were 
priced at arm's length, and there were no specifi c discounts.  Butane, propane and natural gasoline 
were made available to industrial consumers in Sa udi Arabia at a price 30 per cent lower than the 
lowest export price charged for those products.  Heavy naphta was not subject to any discount and 
was priced at the prevailing international price. 
32. At a later stage, the representative of Saudi Arabia confirmed that the Council of Ministers 
Resolution of November 1992 on the government prici ng system of butane, propane, natural gasoline 
had been cancelled by Council of Mini sters Resolution No. 19756/R dated 21/11/1422 
(4 February 2002), which required that prici ng of NGLs supplied to domestic industries be 
commercially based. 
Privatization
 
33. The representative of Saudi Arabia stated that a very important component of the Economic 
Reform Program of the Kingdom of Saudi Arabia (circulated to WTO Members WT/ACC/SAU/54 (4 April 2003)) was privatization.  An ambitious pr ivatization strategy was issued by the Council of 
Ministers on 4 June 2002, to ensure a continued in crease in the share of the private sector and to 
expand its participation in the national economy.  This would be  achieved by adopting the best 
available modality including transferring certain types of economic activity to the private sector, 
enhancing the participation of the private sector in  economic development and enabling it to carry out 
its investment and financing role in accordance with  the national development plans.  The Council of 
Ministers had approved the privatization of the following 19 small, medium and large state-owned 
enterprises and activities: 
- Water and sewage. 
- Desalination. 
- Communications. 
- Air transportation and services.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 15 
 
 
 - Railways. 
- Roads, including management, operati on, maintenance and construction. 
- Airport services. 
- Mail services. 
- Grain silos and flour mills. 
- Port services. 
- Services for industrial cities.   
- Government-owned hotels. 
- Sports clubs. 
- Municipal services, including slaughterhouses and waste removal. 
- Educational services, including school construction and tr ansportation and 
recruitment of Saudis into the private sector. 
- Agricultural services, such as quarantine and operation of laboratories and clinics. 
- Health services, such as operation of hea lth facilities and patient transportation. 
34. The representative of Saudi Arabia added that the Saudi Government also decided to sell 
state-owned shares in the following joint stock co mpanies:  the Saudi Arabian Basic Industries 
Corporation (SABIC), the Saudi Electricity Company (SEC), the Saudi Arabian Mining Company (Ma'aden), the Saudi Telecommunications Company (STC), Saudi Arabian Airlines and the National 
Commercial Bank. 
- Legal Basis for Privatization
 
35. In response to questions from members of the Working Party, the representative of 
Saudi Arabia stated that the legal basis for the privatization program was the Council of Ministers 
Resolution No. 60 of 1.4.1418H (1997).  According to this Resolution, the objectives of the 
privatization strategy were as follows: 
i. Improving the efficiency of the nati onal economy and enhancing its competitive 
ability to meet the challenges of regional and international competition. 
ii. Encouraging private sector investment a nd effective participation in the national 
economy, and increasing its share of domestic  production to achieve growth in the 
national economy. 
iii. Enlarging the ownership of productive assets by Saudi citizens. iv. Encouraging domestic and foreign capital to invest locally. v. Increasing employment opportunities, optimizing the use of the national work force, 
and ensuring the continued equitable increase of individual income. 
vi. Provide services to citizens and investors in a timely and cost-efficient manner. vii. Rationalizing public expenditure and reducing the burden on the government budget 
by giving the private sector opportunities to finance, operate, and maintain certain services that it was able to provide. 
viii. Increasing government revenues from retu rns on participation in activities to be 
transferred to the private sector, and from financing compensation obtained, for 
example, from granting concessions and from the proceeds of the sale of part of government shares. WT/ACC/SPEC/SAU/4/Rev.3 
Page 16  
 
 According to Council of Ministers Resolution No. 257 dated 11.11.1421H (5 February 2001), the 
Supreme Economic Council of Saudi Arabia was r esponsible for supervising the privatization 
program and monitoring its implementation. 
36. He further noted that the basic principles that were taken into consideration when 
implementing the privatization process were: 
i. Disclosure and transparency. 
ii. Expeditious implementation. iii. Changing the management pattern.   iv. Creating a regulatory framework for privatized sectors. 
37. He continued that according to the Privati zation Strategy, the criteria for determining 
priorities in selecting enterprises to  be privatized were based on: 
i. Positive effect on the national economy. 
ii. Readiness of enterprise for privatization. iii. Social benefits of privatizing the enterprise. iv. Inadequacies of the services provided by the public enterprises. 
v. The absorptive capacity of the capital market. 
38. In response to further questions from some me mbers of the Working Party, the representative 
of Saudi Arabia stated that the methods of privatization included the following: 
i. Management Contracts. 
ii. Lease Contracts. 
iii. Financing Contracts. iv. Sale Contracts. 
- Status of Privatization
 
39. The representative of Saudi Arabia informed me mbers of the Working Party that the public 
enterprises privatized so far included the following: 
a) Saudi Electricity Company. 
b) Saudi Arabian Fertilizer Company. 
c) Saudi Arabian Basic Industries Corporation (SABIC). d) Saudi Telecommunications Company. 
40. The representative of Saudi Arabia stated that  the following implementation steps had been 
completed to date: 
i. Tasks related to the management, operati on and maintenance of port berths, as well as 
the provision of associated equipment, had been assigned to the private sector in accordance with the Royal Approval issued in 1417 (1997) and the Council of Ministers' resolution issued in 1419 (1999) which assigned to the private sector a  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 17 
 
 
 greater role in the management and opera tion of ports, and called for a review of 
organizational structures and related pro cedures, a feasibility study on establishing 
free trade areas at the ports and the linking of the two ports of Jeddah and Dammam by a railroad. 
ii. Efforts are underway to attract private-sector investment in a North-South railroad 
connection to increase Saudi Arabia's ab ility to develop its mineral resources. 
iii. The education sector received applicati ons from the private sector to finance the 
construction of schools and to particip ate in providing higher education services 
through private colleges. 
iv. Saudi Arabia has announced that it will privatize Saudi Post.  Competition will be 
allowed in this sector. 
v. The Council of Ministers' resolution 169 of 11/8/1419 (30 Nove mber 1998) approved 
the restructuring of the electricity sector.  Initial investments are to be made within the next few years. 
vi. A Saudi Joint Stock Utility Company had b een established in the twin industrial cities 
of Jubail and Yanbu to operate, mainta in, manage and expand the tasks of 
infrastructure utilities as part of the privatization program. 
vii. The Saudi Telecommunications Comp any was established as a business-oriented 
stock company providing all telecommunications services previously provided by the MOPTT.  In 2002, a 30 per cent stake was sold to Saudi nationals in the private sector. 
viii. In Jeddah Industrial City, a concession st ructured on a BOT (build-operate-transfer) 
basis was granted to a private entity to rehabilitate, maintain and expand a waste-water treatment facility.  This was completed in March 2002. 
ix. In Jubail, a pilot concession on a build, re novate and transfer basis was being pursued 
as a part of a joint venture with a salt water concession company.  This model will be 
used for future desalinization plants. 
State-Owned Enterprises
 
41. The representative of Saudi Arabia gave the following information on Saudi Arabia's state-
owned enterprises: 
i. Saudi Arabian Basic Industries Corporation (SABIC) : 
SABIC was established in 1976 with paid-up cap ital of SAR 15 billion, of which 70 per cent 
was owned by the Saudi government and 30 per cent by Saudi nationals and GCC countries' 
citizens.  The extensive industrialization program undertaken by SABIC is a milestone in the Kingdom's industrial development process.  By  the end of 2001, SABIC completed operation 
of 16 world-class industrial companies in Jubail and Yanbu, most of which are joint ventures 
with international companies, with actual pr oduction of about 34.4 million metric tonnes of 
basic chemicals and intermediate chemicals. 
ii. Saudi Arabian Oil Company (Saudi Aramco)
: 
The Saudi Arabian Oil Company (Saudi Aramco) was a state-owned company established by 
Royal Decree in 1988.  The objective and purpose of Saudi Aramco was the exploitation of WT/ACC/SPEC/SAU/4/Rev.3 
Page 18  
 
 crude oil and natural gas.  Saudi Aramco produ ced crude oil and natural gas in the Kingdom.  
It also refined and marketed products within Sa udi Arabia and entered into joint ventures in 
these activities with local and international oil companies.  Although owned by the 
government, it was run by an independent management and board of directors. 
iii. Saudi Arabian Mining Co. (Ma'aden)
: 
Ma'aden was established in 1996 as an autonom ous joint stock company, owned by the 
government with a capital of SAR 4000 million, wh ich would be privatized gradually.  The 
company undertakes several mining activities related to all stages of the mining industry, 
including development and improvement of the mining industry and products as well as 
related industries.  The company operates on a commercial basis to realize profit. 
iv. Saudi Arabian Airlines (SAUDIA) : 
SAUDIA initially was 100 per cent owned by the Saudi government.  The first steps to 
privatize SAUDIA were taken in 1994, when SAUDIA laid the ground work to allow it to 
operate in accordance with commercial princi ples in order to meet the challenges of 
competition in the market.  In this respect , SAUDIA restructured its administrative and 
executive sectors. 
v. Specialized Financial Institutions (SFI) : 
In the financial sector, there are two government-owned SFIs: 
a. The Saudi Agricultural Bank. 
b. The Saudi Industrial Development Fund. 
Investment Regime  
42. The representative of Saudi Arabia informed  the Working Party that a new Foreign 
Investment Law, replacing the Foreign Capital Investment Law, had been promulgated by 
Royal Decree No. M/1 of 9 April 2000 (5.1.1421 H).  Implementing Regulations under the new Foreign Investment Law had been issued on 24 June  2002.  In response to questions from Members of 
the Working Party, the representative of the Kingdom of Saudi Arabia noted that the Kingdom had started the process of attracting FDI long ago when it issued the first Foreign Investment Law in 1956.  
Another Law followed in 1962, and, in 1979 Saudi Ar abia issued a more comprehensive Law, which 
included wide-ranging incentives for investment, such  as exemption of custom duties for production 
inputs, nominal rental rates for land for the establis hment of projects, financial assistance in the form 
of soft loans and exemption of exports from tax es and duties.  The 1979 Foreign Investment Law had
  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 19 
 
 
 granted industrial and agricultural projects a 10-year  tax holiday and a 5-year tax holiday for other 
projects, provided that national capital formed 25 pe r cent of the project capital and on condition that 
this percentage did not decrease during the holiday  period.  The Law was amended to grant an 
addition 10-year tax holiday to expansions of exis ting projects.  But, to enjoy the incentives, the 1979 
Law required that foreign investments be:  (i) at least 25 per cent Saudi; (ii) among the specified projects of the national development plans; and (iii) of high technical content with foreign expertise to 
facilitate the transfer of technology.
 
43. The representative of Saudi Arabia clarified that, to address developments that took place in 
the international and regional economic landscap e, the investment laws were overhauled 
in April 2000, by the enactment of a new foreign investment law to build on the strengths of the old law and provide additional incentives to increase the level of FDI in the Kingdom.  The new 2000 
Foreign Investment Law provided the legal structur e necessary to attract additional investment.  One 
of the features of the new Law was its departure from tariff incentives and use of other FDI-promoting 
measures in conformity with the recent global liberalization of trade and investment.  A comparison of the old 1979 Law and the new 2000 Law is attached as Annex B. 
44. Members of the Working Party requested in formation on whether GCC nationals received 
preferential treatment in Saudi Arabia.  The represen tative of Saudi Arabia replied that GCC nationals 
are treated as Saudi nationals for the purposes of investment. 
45. Some members of the Working Party requested clarification whether there were any formal 
requirements setting a minimum level of Saudi participation in any business venture.  The 
representative of Saudi Arabia stated that under the new law on foreign investment there was no 
requirement of a minimum share for Saudi investors.  Therefore, foreign investors are no longer required to take local partners and are permitted to  own real estate for company and housing purposes.  
There is a minimum capital investment requirement of SAR 25 million for agricultural projects, SAR 
5 million for industrial projects and SAR 2 million for services projects.  The minimum capital 
investment requirement could be reduced by the Board of Directors of SAGIA for projects established in specified areas, for projects requiring a high degree of technical expertise or for export projects.  Under the new Foreign Investment Law, a forei gn investment may take one of the two following 
forms: 
i. an enterprise owned by foreign and national investors, i.e., joint ventures, but with no 
requirement for minimum share for national investors; or  
ii. an enterprise wholly-owned by foreign investors, i.e., 100 per cent foreign 
shareholders' equity. WT/ACC/SPEC/SAU/4/Rev.3 
Page 20  
 
 46. The Saudi representative stated that a project, wh ether wholly-owned by foreign investors or 
a joint-venture, licensed in acco rdance with the Law, enjoyed all benefits, incentives and guarantees 
available to a national project.  Foreign investment  was permissible in all activities, except a short 
negative list, which would be re vised and shortened periodically.  Under the new Law, a foreign 
investor was entitled to transfer, outside the Kingdom  of Saudi Arabia, the proceeds from the sale of 
his shares or the excess funds from the liquidation of his assets or the profits earned by the enterprise 
or from the disposal of the business in any other le gal manner.  Further, the investor was entitled to 
transfer outside the Kingdom of Saudi Arabia the re quired funds to settle any contractual obligations 
related to the project.  Article 11 of the new Foreign Investment Law provided legal safeguards 
against confiscation or expropriati on of foreign investments.  It was not permissible to confiscate 
foreign investments, wholly or partially, except by a court order.  In addition, it was not permissible to 
expropriate the ownership of foreign investments, wholly or partially, except for the public interest, 
and on payment of reasonable compensation in accordance with the law. 
47. Some members of the Working Party requested  clarification of the incentives offered by 
Saudi Arabia to foreign investors to invest in Saudi Arabia in order to support the inflow of 
technology and expertise, in particular whether technology transfer was in any way a condition for 
investment approval in all or certain areas.  The representative of Saudi Arabia replied that under the 
new Foreign Investment Law of 9 April 2000, technology transfer was not a condition for investment approval.  A foreign investor had to approach  only one authority - the Saudi Arabian General 
Investment Authority (SAGIA) - to obtain a license.  SAGIA was required to decide on the 
investment application within 30 days from the da te all required documents were submitted.  SAGIA 
would also serve as the enquiry point on laws, regulations and procedures relating to foreign 
investment.  The SAGIA license provided the foreign investor all of the privileges held by local 
investors.  In response to a question from a memb er of the Working Party regarding whether the 
SAGIA license was the only license or approval requi red by a foreign investor, the representative 
from Saudi Arabia stated that, after obtaining the S AGIA license, the foreign investor was treated the 
same as any local investor and, thus, for certain businesses, must apply for other registrations and/or permits depending upon the nature of the business.  For example, a company seeking to establish a 
company and set up a hospital—whether backed by a national or a foreign investor—would need to 
obtain a company registration and permit from the Ministry of Commerce and Industry and a health practice permit for hospitals from the Ministry of Health.  The new Foreign Investment Law and the 
implementing regulations provided that foreign inv estment ventures had the right to own real estate 
necessary to carry out their licensed activities or to  accommodate their employees, in accordance with 
regulations of property ownership for non-Saudis.  Further, it was provided that foreign investors had 
the right to sponsor and bring their non-Saudi employees subject to numerical limits.    WT/ACC/SPEC/SAU/4/Rev.3 
 Page 21 
 
 
 48. The representative of Saudi Arabia further noted  that the Foreign Investment Law allowed 
foreign investors to invest in local or foreign vent ures, provided that general conditions applicable to 
new investments were met.  A foreign investor could apply for multiple licenses permitting different 
activities, provided that the foreign investor was not the owner of or a shareholder in a project which 
was in financial default.  The Law laid down that the amount of capital to be invested in a licensed 
project must not be less than 5 million Saudi Riyals for industrial projects, not less than 25 million 
Saudi Riyals for agricultural projects (traditiona l agricultural production, excluding food processing) 
and not less than 2 million Saudi Riyals for other projects. 
49. Some members of the Working Party asked wh ether the government had issued licenses to 
100 per cent foreign-owned operations.  In response the representative of Saudi Arabia stated that 
1,278 licenses had been issued for wholly foreign-owne d enterprises.  In response to further questions, 
he noted that under the new Foreign Investment La w of April 2000 "national treatment" was given to 
foreign investors.  He further stated that the Fo reign Investment Law was fully consistent with the 
WTO  Agreement on Trade-Related Investment Measures,  and reiterated that Saudi Arabia did not 
apply any TRIMs prohibited by the WTO  Agreement on Trade-Related Investment Measures.   
50. In response to questions from some members of the Working Party concerning whether the 
Government of Saudi Arabia planned to liberalize its stock market and open it to non-Saudi investors, 
the representative of Saudi Arabia stated that Sa udi Arabia was gradually changing its regulations 
concerning participation of foreign investors in the shares market.  Although direct share trading in 
Saudi Arabia was restricted to Saudi and GCC nati onals, there were no restrictions on investment by 
foreign investors in Government Bonds, Treasury B ills or Saudi mutual funds.  There were non-GCC 
nationals that held shares of joint stock companies which were traded in the equity share market but 
those non-GCC nationals were required to receive permission from concerned authorities, such as the 
Saudi Arabian Monetary Agency and the Ministry  of Commerce and Industry, prior to buying or 
selling their shares.  In its continuous review and assessment of the development of the financial 
market, the Kingdom of Saudi Arabia had allowed the establishment of a close-ended fund (SAIF) 
listed on the London Stock Exchange through which inte rnational investors could participate in the 
Saudi shares market.  In November 1999, Saudi Arab ia had made further changes to its regulations 
and now permits foreigners to inv est in open-ended mutual funds mana ged by banks that invest in the 
Saudi equity shares market. 
51. In response to questions from members of the Working Party, the representative of 
Saudi Arabia reported that the newly adopted Ca pital Market Law, promulgated by Royal Decree 
No. M/30, dated 02.06.1424H (13 July 2003), estab lished a strong government regulatory body, the WT/ACC/SPEC/SAU/4/Rev.3 
Page 22  
 
 Capital Market Authority (CMA).  The CMA ha d rule-making and enforcement powers necessary to 
guarantee that the Kingdom's security market was fa ir, efficient and vibrant.  The CMA had the 
authority to promulgate and enforce rules for th e disclosures necessary in connection with the offering 
of securities, the continuous disclosure obligations  of publicly traded companies, disclosures and 
practices in connection with takeovers of public co mpanies, the regulation of proxy solicitations and 
to define and police insider trading and other a busive securities practices.  Most notably, the CMA 
had powers to license non-bank financial intermedia ries engaged in investment banking activities, 
such as corporate finance, asset management and brokerage activities.   Non-bank financial 
intermediaries had been required to incorporate as a joint stock company, with a minimum capital of 
SAR 50 million. 
52. The representative of Saudi Arabia further not ed that the new Capital Market Law also 
stipulated the creation of the Saudi Arabian Secu rities Exchange.  The Exchange was the exclusive 
securities market of the Kingdom.  Its nine-member board of directors included three public directors representing the Ministry of Finance, SAMA and the Ministry of Commerce and Industry.  In addition, the Law empowered the Exchange to estab lish professional and ethical standards for brokers 
and required the Exchange to establish as one of its  departments the Securities Deposit Centre, which 
had responsibility for the clearance and settlement  of all securities transactions executed on the 
Exchange.  The Centre also maintained the reco rd of ownership for all securities traded on the 
Exchange.  The law also called upon the CMA to est ablish and maintain a tribunal with exclusive 
jurisdiction to resolve all disputes involving securities.   (The provisions of the Capital Market Law are 
summarized at Annex C.)  
53. Some members of the Working Party asked whether Saudi Arabia planned to remove its 
restrictions on foreign investment in explorati on and extraction of hydrocarbons.  The representative 
of Saudi Arabia replied that significant investments by foreign investors relating to the upstream 
development of non-associated gas had been approve d; others were underway.  He noted that, for 
reasons of important national policies, restricti ons on foreign investment in the upstream sector, 
though relaxed, could not be  completely removed. 
54. Some members of the Working Party sought a clarification about an Article of the 
Implementing Regulations which said that licenses gran ted must not violate Saudi Arabia's regional or 
international  Agreements and asked Saudi Arabia to indicat e where this might occur.  They further 
requested Saudi Arabia to clarify the relations hip of Implementing Regulations to the Foreign 
Investment Law and enquired whether there were cu rrent plans for any additional elabouration of the 
Regulations.  In response to these, the representative of Saudi Arabia stated that Article 5 of the  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 23 
 
 
 Implementing Regulations provided that granting a foreign investment license must not contravene 
international or regional treaties signed by th e Kingdom of Saudi Arabia.  These included the 
WTO  Agreement, the GCC and other treaties signed by Saudi Arabia.  He explained that, for 
example, Saudi Arabia would not issue any licen se to produce chemicals or materials that were 
restricted under regional or international  Agreements to which Saudi Arabia was a party.  Similarly, 
Saudi Arabia would not issue licenses to produce materials that were in breach of a regional or 
international  Agreement on environmental protection to which Saudi Arabia was a party.  With regard 
to the observations of Working Party members on Implementing Regulations, the representative of Saudi Arabia explained that Implementing Regulati ons were in the nature of by-laws issued by 
SAGIA, under Article 17 of the Foreign Investment Law,  to implement the Law.  He stated that there 
were no current plans for additional ela bouration of the Implementing Regulations. 
55. Members of the Working Party also inquired as to  the specific content of the "negative list."  
In response, the representative of Saudi Arabia provi ded the following information.  The negative list, 
which was issued by a decision of the Suprem e Economic Council under Article 3 of the Foreign 
Investment Law, did not target specific companies;  rather, it applied to certain limited industrial and 
services sectors.  The Saudi Representative reported that many of the items on the list would be 
removed upon accession, to reflect the commitments in the Services Schedule.  He further noted that, 
following accession, Saudi Arabia would remove a dditional items from the negative list each year 
(beyond Saudi Arabia's WTO commitments), to furt her liberalize the economy.  The list, including 
significant exceptions allowing the provision of cer tain printing and publishing services and certain 
telecommunications services, follows: 
I. Industrial Sectors
 
a. Oil exploration, drilling and production,  except the services related to the mining 
sector listed at 5115 and 883 in Interna tional Industrial classification codes. 
b. Manufacturing of military equipment, devices and uniforms. 
c. Manufacturing of civilian explosives. 
II. Services Sectors  
a. Catering to military sectors. 
b. Security and detective services. c. Insurance services (until the issu ance of the new Insurance Act) 
d. Real estate investment in Makkah and Madina. 
e. Tourist orientation and guidance services related to Hajj and Umrah. 
f. Recruitment and employment services including local recruitment offices. g. Real estate brokerage. 
h. Printing and publishing, except the following activities:  WT/ACC/SPEC/SAU/4/Rev.3 
Page 24  
 
 - Pre-printing services (CPC 88442) 
- Printing presses (CPC 88442) 
- Drawing and calligraphy (CPC 87501) 
- Photography (CPC 875) 
- Radio and Television Broad casting Studios (CPC 96114) 
- Foreign media Offices and Correspondents (CPC 962) 
- Promotion and Advertising (CPC 871) 
- Public relations (CPC 86506) 
- Publication (CPC 88442) 
- Press services (CPC 88442) 
- Production, selling and renting of computer software (CPC 88) 
- Media consultancies and studies (CPC 853) 
- Typing and copying 
i. Distribution services, wholesale and retail trade, including medical retail services and 
private pharmacies, and commercial agenci es, except franchise rights listed at CPC 
8929, with foreign ownership not exceeding (49 per cent), and the granting of one 
franchise to each area. 
j. Audio-visual and media services. k. Telecommunications services, except the following activities: 
- Telex services (CPC 7523) 
- Telegraph services (CPC 7522) 
- Electronic data interchange (CPC 7523) 
- Enhanced/Value-Added facsimile services, including storage, forwarding, and 
retrieving (CPC 7523) 
- VSAT services (CPC 75291) 
- Fax services (CPC 7529 and 7521) 
- GMPCS services (CPC 75299) 
- Internet Service Provider services (CPC 75299) 
- Electronic Mail (CPC 7523) 
- Provision of online information a nd database retrieval (CPC 7523) 
- Information provision and online retrieva l and/or processing, including transaction 
processing (CPC 843) 
l. Land and air transport. 
m. Satellite transmission services. n. Services provided by midwives, nurses, physiotherapists and paramedics 
(CPC 93191). 
o. Fisheries. 
p. Blood banks, poison centres and quarantines. 
56. Members of the Working Party asked that Saudi Arabia clarify its rules regarding 
employment of Saudi nationals.  In response, the representative of Saudi Arabia noted that Council of 
Ministers decision No. 50, dated 21/4/1415 (27 Se ptember 1994), and Council of Ministers Bureau 
Letter 8/490, dated 28/6/1414 (13 December 1993), set forth requirements regarding the hiring and 
employment of Saudi nationals.  He emphasized  that the rules were  necessary to increase the 
employment of Saudi nationals in the Kingdom.  The rules were as follows:  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 25 
 
 
 i. Companies of all types and activities should endeavour to attract and retain nationals. 
ii. Companies employing 20 or more people should increase the proportion of nationals 
employed by 5 per cent each year.  The 5 per cent figure is subject to modification according to workforce availability, the na ture and condition of the work and the 
availability of Saudis to fill the particular position(s). 
iii. Companies should, while working to reach th is average, employ nationals in a variety 
of positions. 
iv. Companies should not appoint a non-Saudi as a human resources department chief, a 
company employment official, a receptionist, a commentator, a treasurer or a civil guardian. 
v. Violations of i-iv, above, could r esult in penalties ranging from suspension of 
approval of requests for workers to deprivation of credit or removal from consideration for the governmental tenders or bids. 
57. In addition, the Saudi representative repor ted, under Decision No. 50 and Council Letter 
No. 8/490, the Ministry of Labour and Social Affairs had established a Committee to implement and oversee the provisions set forth above.  The Committee was headed by the Deputy Minister or a 
person he appointed, and comprised delegates from th e Ministry of Interior and the Ministry of 
Commerce and Industry. 
58. The representative of Saudi Arabia noted that, upon accession to the WTO, the hiring and 
employment restrictions set forth above would be modified to comply  with the provisions of the Saudi 
commitment on services. 
FRAMEWORK FOR MAKING AND ENFORCING POLICIES
 
59. The representative of Saudi Arabia explained that  the Basic Law of Government, instituted by 
Royal Decree No. A/90 dated 27 Shaaban 1412 H (1 March 1992), set down the law concerning political authority within Saudi Arabia.  Article 56 of the Basic Law of Government stated that the 
King was the Chairman of the Council of Ministers and was assisted by Ministers in the performance 
of his duties.  The Basic Law of Government also st ated that the Law of the Council of Ministers laid 
down the powers of the Council regarding internal  and external policies, the organization and 
coordination of the various Government authorities; and the conditions to be satisfied by, the powers 
of, the method of responsibility and all affairs of the Ministers. 
60. He recalled that pursuant to Article 17 of the Consultative Council Law, resolutions passed by 
the Consultative Council were forwarded to the Ch airman of the Council of Ministers, who passed 
them to the Council of Ministers for consideration.   When the points of view of both Councils were 
in Agreement they were enacted after being approved by the King.  In case of a difference of opinion, 
the King approved what he consider ed appropriate.  Article 70 of the Basic Law of Government and 
Article 20 of the Council of Ministers Law pr ovide that laws, treaties and international  Agreements WT/ACC/SPEC/SAU/4/Rev.3 
Page 26  
 
 and concessions were enacted and amended by Roya l Decrees after having been considered by the 
Consultative Council and the Council of Ministers r espectively.  In general, no initials could be 
affected on any  Agreement or obligation until approved by th e Council of Ministers.  In conclusion, 
he added that the Kingdom of Saudi Arabia w ould do whatever was required, whether through 
Royal Decree, Council of Ministers Decree or Ministerial Orders to bring its trade regime into conformity with its WTO obligations. 
61. In response to a question from the members of  the Working Party, the representative of 
Saudi Arabia confirmed that, under Article 70 of  the Basic Law of Government (Royal Decree 
No. A/90 dated 27/8/1412H (1 March 1992)), Royal Decrees were the legal instrument by which 
international  Agreements and treaties were implemented in to domestic law.  In accordance with the 
lawmaking process described above, international  Agreements and treaties were first referred to the 
Council of Ministers and the Consultative Council for approval.  Upon receiving approval of both 
bodies the relevant  Agreement or treaty became part of domestic law by means of Royal Decree.  
International  Agreements and treaties did not take preced ence over other provisions of domestic law, 
nor did other provisions of domestic law take precedence over international  Agreements or treaties.  
Rather, conflicts or inconsis tencies between international  Agreements and treaties and other 
provisions of domestic law were resolved in accord ance with the same rules of interpretation that 
were applied to domestic legislation. 
62. In response to a question from members of the Working Party, the representative of 
Saudi Arabia stated that the implementation of tr ade policies was by means of the enactment of an 
appropriate new law (nizam).  As part of the lawmaking process, the draft legislation was prepared by the relevant government agency (e.g., the Ministry  of Commerce and Industry), which then submitted 
it to the Council of Ministers and the Consultativ e Council for comments.  Both bodies reviewed the 
draft law and either agreed the text put forward by  the government agency or proposed changes to it.  
If the Council of Ministers and the Consultative Counc il had divergent views of the draft legislation 
then those views were communicated to the King who resolved the matter by deciding which view 
should prevail.  The final text of the legislati on was then promulgated in the official gazette ( Umm Al-
Qura ).  The representative of Saudi Arabia further e xplained that a new law would originate in the 
ministry having authority over the subject matter of the law.  The ministry would submit the draft law 
to the Council of Ministers, which would conduct an  initial review.  If the Council approved the draft, 
it would send the draft to the Bureau of Experts.  The Bureau of Experts would review the draft to 
ensure that the draft would accomplish its purpose and comply with international legal and/or 
technical norms.  If the Bureau approved the draft law, it would submit it to the Shoura Council, 
Saudi Arabia's consultative legislative council.  The role of the Shoura in this process was to ensure  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 27 
 
 
 the compatibility of the draft law with internationa l legal norms and with Saudi Arabia's local and 
international policies.  The Shoura Council would then  send the law to the Council of Ministers for its 
final approval.  Last, the Council of Ministers, ha ving approved the draft law, would submit it to the 
King for his assent.  After the King issued a Royal Decree enacting the law, the law was returned to 
the ministry that drafted the law.  Subject to th e law and the Royal Decree, the ministry would be 
responsible for all aspects of implementation, incl uding the promulgation of implementing regulations 
required for implementation within the time period sp ecified in the law and the Royal Decree and, in 
some cases where necessary, additional laws (subject to approval of the Council of Ministers). 
63. The representative of Saudi Arabia further clar ified that a law itself specified the date on 
which it took effect (typically on a certain date afte r publication in the official gazette).  It also 
specified the agency or agencies that were responsible for drafting and approving the implementing 
regulations.  The purpose of the implementing regulations was to set out the procedural and 
administrative details by which the provisions of th e new law were implemented.  They were drafted 
by the relevant government agency and published in th e official gazette.  A function of the legislative 
process was to identify potential conflicts and in consistencies between the proposed new law and 
other applicable laws.  Therefore the new law, when  finally promulgated, generally dealt with such 
matters.  An old law that clearly conflicted with  the new law was repealed.  Occasionally laws and 
implementing regulations required further interpre tation.  These interpretations took the form of 
ministerial decisions or directives and were gene rally limited to matters that were not legally 
significant.  The representative of Saudi Arabia confirmed that the process of lawmaking and 
regulation preparation and drafting that applied to  the implementation of trade policies was the same 
process that applied to the implementation of purely domestic policies. 
64. The representative of Saudi Arabia described th e role and functions of the following cabinet-
level councils and authorities: 
i. The Supreme Economic Council (SEC) w as established in August 1999 to evaluate 
economic, trade, industrial, agricultural and labour policies to assess their 
effectiveness.  The SEC also oversaw economic restructuring and privatization aimed at opening Saudi markets and attracting investment. 
ii. The Saudi Arabian General Investment Authority (SAGIA) was created to further 
promote foreign investment and serve the business community as a one-stop shop. 
iii. The Supreme Commission of Tourism was established to promote the tourism sector. 
iv. The Food and Drug Authority was estab lished to secure consumer protection 
regarding the safe use of all foodstuffs, pharmaceuticals and medical equipment. 
65. The representative of Saudi Arabia stated that the role and functions of different Ministries 
and agencies concerned with WTO issues was as follows: WT/ACC/SPEC/SAU/4/Rev.3 
Page 28  
 
 i. The Ministry of Commerce and Industry was the principal government agency 
concerned with formulation and conduct of tr ade policies, and with the development, 
support and encouragement of commercial activities within the Kingdom.  It implemented the laws and regulations relati ng to trade, in particular the Companies 
Law, the Law on Commercial Registration and the Law on Commercial Agencies.  
The Ministry also formulated policies and procedures for the development and 
promotion of industries.  It was respons ible, through the Saudi Arabian Standards 
Organization (SASO), for standards and tec hnical regulations and for ensuring that 
imported and domestically produced goods meet the standards.  The Ministry was also responsible for applying the Trade Marks Law. 
ii. The Ministry of Finance was concerned with formulation and conduct of financial 
and fiscal policies and with international ec onomic issues.  It was also the parent 
Ministry of the Department of Customs, which was charged with the responsibility of implementing the Customs Law and the Customs Tariff of Saudi Arabia. 
iii. The Ministry of Petroleum and Mineral Resources formulated and implemented the 
oil policies of the Kingdom and supervised concessions in the oil and mining sectors. 
iv. The Ministry of Agriculture was the principal government body responsible for the 
development and encouragement of the agricultural sector in Saudi Arabia.  It formulated and implemented agricultural policies and was responsible for matters 
relating to sanitary and phytosanitary measures. 
v. The Ministry of Health was responsible for supervising the health industry and for 
matters related to the import and sale of medicines and medical supplies. 
vi. The Ministry of Information and Culture was responsible for implementation of the 
Copyright Law and matters relating thereto. 
vii. The Saudi Arabian Standards Orga nization (SASO) established and approved 
national standards for imported and domes tically produced goods.  It was also 
concerned with the sampling, inspection a nd testing of goods to ensure conformity 
with standards. 
viii. The Saudi Arabian Monetary Agency  (SAMA) acted as the central bank of 
Saudi Arabia.  It was responsible for mone tary and exchange rate policies and the 
supervision of banks. 
66. Members of the Working Party inquired as to the role of the Chamber of Commerce in 
Saudi Arabia.  In response, the representative of Saudi Arabia reported that each of the principal 
commercial centres in Saudi Arabia had its own Ch amber of Commerce.  Each local Chamber was a 
private association to which local businesses (incl uding traders, professionals and industrialists) 
belonged.  The Chambers funded their operations by means of annual membership subscriptions, 
which varied depending on the size of the member  business.  Hence larger businesses paid higher 
membership subscriptions than smaller ones.  Me mbership in the local Chamber was compulsory 
because each business (apart very small businesses) w as required to produce evidence of Chamber of 
Commerce membership as part of the process of obt aining Commercial Registration.  Each Chamber 
was governed by a Board of Directors, which was largely elected by the membership.  The activities 
of the Chambers were supervised in part by the Mini stry of Trade, which also had the right to appoint 
representatives to the Boards of Directors.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 29 
 
 
 67. In response to questions from members of the Working Party, the representative of 
Saudi Arabia stated that the primary legal basis fo r the trade regime of Saudi Arabia was provided by 
the following laws, decrees and implementing measures:  
i. Companies Law and Implementing Regulations 
ii. Professional Companies Law and Implementing Regulations iii. Commercial Register Law and Implementing Regulations 
iv. Commercial Agencies Law and  Implementing Regulations 
v. Trade Names Law and Implementing Regulations vi. Negotiable Instruments Law vii. Trade Marks Law and Implementing Regulations viii. Composition with Creditors Law 
ix. Combat of Commercial Fraud Law and Implementing Regulations 
x. Commercial Statements Law xi. Import Licensing Guide xii. Import Licensing Procedures xiii. Patents of Inventions La w and Implementing Regulations 
xiv. GCC Common Customs Law and Implementing Regulations 
The Saudi representative reported that a complete list of the principal laws and regulations that form 
the basis of the Saudi trade regime appears at  paragraph 3, the Documentation section, above. 
68. The representative of Saudi Arabia stated that  Saudi Arabia provided for a wide range of 
judicial, arbitral and administrative procedures with respect to trade matters.  An aggrieved party had 
a final right of appeal against all administrative decisions in matters of trade to a judicial body known as the Board of Grievances.  The first channel of  redress was to appeal administrative bodies.  For 
example, with regard to matters under the juri sdiction of the Customs Directorate, such as 
classification and valuation, there was an administra tive system for appeal against rulings.  Disputes 
pertaining to Article VII related to valuation of goods for customs purposes were under the authority 
of the standing Committee within the Customs Department.  Similar dispute settlement systems had 
been established, for example, with regard to  sanitary and phytosanitary measures, licensing, 
standards, and intellectual property rights.  Mi nistries and/or Agencies involved had established 
internal standing committees of senior officials to  review initial administrative decisions.  All 
decisions made by these "standing Committees" could be  appealed to the head of the Ministry or 
Agency concerned. 
69. He further stated that if the decision under appeal  was maintained by the head of the Ministry 
or Agency concerned, these decisions were subj ect to appeal to the Board of Grievances under 
Article 8(a) of the Board of Grievances Law of 17.1.1402 H (14 November 1981).  The Board of 
Grievances was an independent tribunal to wh ich appeals were made from all governmental 
administrative decisions, and addressed the obligati on in Article X:3 of the GATT 1994 to provide for WT/ACC/SPEC/SAU/4/Rev.3 
Page 30  
 
 a right of appeal of administrative decisions to an independent tribunal.  The jurisdiction of the Board 
included appeals against all administrative decisi ons of Government Departments and Government 
officials, and its decisions were binding on the government office concerned.  It was composed of a 
President, Vice-Presidents and Members.  The Preside nt was appointed by and reported to the King.  
The Vice-Presidents and Members were appointed by Royal Decree on the recommendation of the President.  The time frames for hearing of app eals and handing down of decisions depended on the 
volume of work with the Board and on the nature  of appeals.  Although there were no fixed time 
frames, the Board was required to supply to all pa rties to any appeal a judicial judgment which 
included the reasons for the decision.  The time required depended upon the complexity of the case and similar other factors.  Article (47) of the Board of Grievances Law provided for the publications 
of the judicial decisions. 
70. He also noted that the Board's decisions coul d be challenged and appealed to the Appeals 
Court (Scrutiny Commission) within the Board of Gr ievances, which would either confirm or reverse 
appealed decisions.  In all cases, the Appeal Co mmission's decisions were final and enforceable. 
71. The representative of Saudi Arabia confirmed th at from the date of accession, Saudi Arabia's 
laws would provide for the right to appeal ad ministrative rulings on matters subject to WTO 
provisions to an independent tri bunal in conformity with WTO obligations, including but not limited 
to Article X:3(b) of the GATT 1994.  The Working Party took note of this commitment. 
72. In response to further questions, the representativ e of Saudi Arabia stated that Article 70 of 
the Basic Law of Government provided that international  Agreements entered into force as domestic 
laws following their ratification by Royal Decr ee and enactment by the Consultative Council and 
Council of Ministers.  As a general rule, should Saudi Arabia's laws or other acts be found to 
contradict international treaties or  Agreements, Saudi Arabia would bring its laws or other acts into 
conformity with such treaties or  Agreements.  He noted, however, that this principle did not apply in 
respect of fundamental religious rules and principl es, such as prohibiting the consumption of alcohol 
and pork.  To bring its Laws and Re gulations into conformity with WTO  Agreements, Saudi Arabia 
had already enacted or would enact Laws and amendm ents to existing Laws in relation to the various 
substantive provisions of the WTO  Agreements, such as TRIPS, Customs Valuation, SPS, TBT, 
Import Licensing, including transparency provisions. 
73. The representative of Saudi Arabia confirmed that the Kingdom had acceded to the Vienna 
Convention on the Law of Treaties 1969 vide C ouncil of Ministers' Resolution No. 165 dated 
24.6.1423 H (1 September 2002).  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 31 
 
 
 74. In response to questions from members of the Working Party, the representative of 
Saudi Arabia indicated the Ministry of Comme rce and Industry would continue to oversee and 
coordinate within the Saudi Government matters relating to the WTO, including implementation and 
interpretation issues. 
75. In response to questions from members of the Working Party, the representative of 
Saudi Arabia confirmed that only the central govern ment had authority over matters covered by the 
WTO  Agreements and that the central government was superior in authority to sub-central 
governments.  The authority of sub-central governme nts in Saudi Arabia, he noted, was quite limited 
in comparison to the situation in many countries.   For example, even as regards issues typically 
classified as local issues, e.g., local constructi on projects and water and sewage treatment, to the 
degree that sub-central governments had any role wh atsoever, the role was limited by and exercised 
within tight constraints set by the central government. 
76. The representative of Saudi Arabia confirmed that the provisions of the WTO  Agreement, 
including Saudi Arabia's Protocol, would be app lied by the central government uniformly throughout 
Saudi Arabia's customs territory and other terr itories under Saudi Arabia's control, including in 
regions engaging in border trade or frontier traffi c, special economic zones, and other areas where 
special regimes for tariffs, taxes and regulations were established.  The Working Party took note of 
these commitments. 
POLICIES AFFECTING TRADE IN GOODS  
Trading Rights (The Right to Import and Export)  
77. The representative of Saudi Arabia noted that  members of the Working Party had, in 
connection with trading rights (the right to import and export), requested an explanation of:  (i) the 
requirements for approval; (ii) the grounds for di sapproval; and (iii) whether a license was granted 
automatically upon satisfaction of (i).  The representa tive of Saudi Arabia stated firstly, by way of 
clarification, that Saudi businesses and foreign comp anies with branches or offices in Saudi Arabia 
must apply for Commercial Registration under the Law on Commercial Registration described above.  
This was a general requirement which applied to all businesses (except for the smallest) irrespective 
of whether they were engaged in import or expor t trade.  Commercial Registration was largely a 
routine procedure that involved the completion of an  application form, the payment of a fee and the 
submission of documentation to the Ministry of Commerce. WT/ACC/SPEC/SAU/4/Rev.3 
Page 32  
 
 78. The representative of Saudi Arabia confirmed th at there were no substantive requirements to 
register with the Ministry of Commerce and Industry in order to import, although there was a 
requirement to obtain Commercial Registration for the carrying on of business, whether 
manufacturing, retailing or trading.  In order for a foreign business to obtain a Commercial Registration for the carrying on of business in Saudi Ar abia, it had to first obtain a foreign investment 
license from the Saudi Arabian General Investment Authority (SAGIA).  Upon receiving a foreign 
investment license from SAGIA, the foreign business would apply to obtain a commercial registration 
from the Ministry of Commerce and Industry.  The rules and procedures for obtaining commercial registration were set forth in the Law on Commerc ial Registration issued pursuant to Royal Decree 
No. M/1 dated 21/02/1416 H (19 July 1995) and the Law on Commercial Names issued pursuant to Royal Decree No. M/15 dated 12/08/1420 H (20 Nove mber 1999) and the rules and regulations 
promulgated thereunder.  In respect of commercial registration, separate forms were to be filled in 
depending on the form of entity to be given commerc ial registration.  The procedure in commercial 
registration further provided payment of a registrati on fee (for a registration valid for five years) of 
SAR 1,000 in case of establishments, SAR 4,000 in case of partnerships, SAR 6,000 in case of limited 
liability companies; and SAR 8,000 in case of joint stock companies.  In the case of limited liability 
companies, draft articles of association were required to be submitted to the Ministry of Commerce and Industry for review.  Once such forms had been duly prepared, they were checked and 
authenticated by a notary public.  Having been si gned, authenticated and legalized, these documents 
were then published in the official gazette ( Umm Al-Qura ).  In the case of limited liability companies, 
after printing and formal signing of the articles of association before a notary public, such articles were submitted to the Ministry of Commerce and Industry and commercial registration was issued. 
79. The representative of Saudi Arabia also noted that "commercial registration" was a separate 
procedure and different from registration as a "c ommercial agent".  Registration as a commercial 
agent was not necessary for the right to import or e xport.  Any company, whether Saudi or foreign, 
which was commercially registered in the field of import trade could import goods without the need to 
get any further permission or authorization, except for items which required an import license or were 
otherwise subject to import restrictions or prohibitions .  A firm that wished to be legally eligible to 
import goods should formally incorporate the activity  of importing within its "scope of business" 
clause of its articles of association. 
80. The representative of Saudi Arabia confirmed that the Ministry of Commerce had no 
discretion to deny Commercial Registration to a legitimate business, provided that the application 
form had been correctly completed and was accompanied by the correct fee and supporting  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 33 
 
 
 documentation.  A legitimate business was one who se contemplated activities did not contravene 
Saudi laws or regulations (e.g., those prohibiti ng the production and distri bution of pork products). 
81. The representative of Saudi Arabia confirmed that the Commercial Registration set out the 
scope of business activities of the registered entity.  A company that wished to carry out activities not 
covered by its Commercial Registration could ame nd its articles of association to include the new 
activities and apply to the Ministry of Commerce fo r its Commercial Registration to be amended so as 
to permit those new activities. 
82. In response to a question from a member of  the Working Party, the representative of 
Saudi Arabia stated that Saudi Arabian law perm itted a wide range of business entities, all of which 
were subject to the Law on Commercial Registration.   Those entities included sole traders (the most 
common form of business vehicle), general partners hips, limited partnerships, joint ventures, joint 
stock companies, partnerships limited by sh ares, limited liability companies and professional 
companies. 
83. The representative of Saudi Arabia informed th e Working Party that Commercial Registration 
was a distinct procedure from registration as a "Co mmercial Agent".  In Saudi Arabia "commercial 
agency" described a business activity in which a natural or legal person acted as the agent or 
distributor of a producer, typically a foreign producer.  The law governing the registration of Commercial Agents was set out in the Commerc ial Agencies Law (Royal Decree No. M/11 dated 
20/2/1382H) and its Implementing Regulations (Min isterial Resolution No. 1897 dated 24/5/1401H).  
He clarified that only Saudi nationals or Saudi legal persons could be registered as Commercial 
Agents.  The capital of the business had to be wholly Saudi and its directors, managers and authorized 
signatories had to be of Saudi nationality.  This r estriction, he explained, was necessary to protect 
consumer interests.  For example, the Saudi agen t or distributor was liable for the duration of the 
agency and one year thereafter to provide at all times such spare parts, as are usually required by 
consumers, at reasonable prices.  In addition, the Saudi agent or distributor must provide such 
maintenance as the products may require at suitable cost and warrant the quality of the manufacture of 
the products. 
84. In additional to having Saudi nationality, th e requirements for approval as a Commercial 
Agent under the above measures were: (i) a Commercial Registration certificate giving commercial 
agency as one of the applicant's business activities;  (ii) a certificate from the Chamber of Commerce 
confirming that the applicant had paid his Ch amber of Commerce subscriptions; and (c) the 
submission of an application form and supporting documentation to the Ministry of Commerce and 
Industry, including a copy and a certified Arabic tran slation of the commercial agency or distribution WT/ACC/SPEC/SAU/4/Rev.3 
Page 34  
 
 contract which complied with the conditions set out  in the law.  The Saudi representative confirmed 
that the Ministry of Commerce and Industry had no discretion to deny registration of an entity as a 
Commercial Agent provided that the above requireme nts were satisfied and a registration fee was 
paid. 
85. The representative of Saudi Arabia noted that the Commercial Agencies Law did not require a 
foreign manufacturer/supplier to appoint an agent or  distributor in Saudi Arabia.  Any company, 
whether Saudi or foreign, which was commercially registered in the field of import trade, could 
import goods without the need to get any further pe rmission or authorization, except for items which 
required an import license. 
86. In essence, the representative of Saudi Arabia reported, the distinction between Commercial 
Registration and registration as a Commercial Agent is that Commercial Registration is an essential 
requirement to the conduct of any significant bus iness activity in Saudi Arabia whereas Commercial 
Agency is a particular type of business activity. 
87. In response to a question, the representative of Saudi Arabia stated that foreign companies 
holding commercial registration in Saudi Arabia c ould directly import goods, for their own use or as 
inputs, without going through a commercial agent. 
88. In response to a specific question, the repr esentative of Saudi Arabia confirmed that no 
special or unique "activity license" requirements ex isted for foreign or domestic persons or firms 
engaging in importing or exporti ng goods.  He confirmed that i ndividuals and firms were not 
restricted in their ability to import or export goods  except as described in their scope of business or 
their registration, and that they could easily change their registration to allow for trade.  He further 
confirmed that there were no restrictions, such as capital or nationality requirements, on firms wishing 
to engage in foreign trade, and that the criteria fo r registration were published in the official gazette 
and generally applicable to all. 
89. In response to specific questions, the representativ e of Saudi Arabia recognized the distinction 
drawn in the WTO between the right to import and export under the GATT and the right, under the 
GATS, to provide services such as distribution and transportation, with respect  to imported goods.  Saudi Arabia would, in implementing its obligati ons under GATT 1994, ensure that the relevant laws, 
regulations and requirements permit foreign firms to re gister strictly to engage in importation without 
limitation on equity or requirement to invest in Saudi Arabia.  Commercial distribution in 
Saudi Arabia of imports as well as domestically pr oduced goods would remain subject to the current 
requirements for commercial registration under the re levant laws, and to the Kingdom's commitments  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 35 
 
 
 under the GATS.  Moreover, Saudi Arabia maintained  the right to require importers that were not 
registered to engage in commercial distribution to provide information in their customs document 
regarding the further disposition of th e goods, once they entered Saudi Arabia. 
90. The representative of Saudi Arabia said that Saudi  Arabia's requirements on the right to trade 
would not contradict Articles III, VIII and XI of  GATT 1994.  The representative of Saudi Arabia 
confirmed that there would be no restrictions on the right of foreign and domestic individuals and 
enterprises to import and export goods to a nd from Saudi Arabia, except as provided in 
WTO  Agreements.  Saudi Arabia emphasized that fore ign enterprises and individuals had to comply 
with all WTO-consistent requirements related to  importing and exporting, such as those concerning 
import licensing, TBT and SPS.  However, foreign enterprises and individuals would not have the 
right to distribute goods within Saudi Arabia.  Providing distribution services would be done in 
accordance with Saudi Arabia's Schedule of Speci fic Commitments on Services.  The representative 
of Saudi Arabia confirmed that individuals and firms were not restricted in their registered scope of 
business and the criteria for registration of companies in Saudi Arabia were generally applicable and 
published in the Official Gazette. 
91. The representative of Saudi Arabia confirmed that from the date of accession Saudi Arabia 
would ensure that its laws and re gulations relating to the right to trade in goods and all fees, charges 
or taxes levied on such rights would be in fu ll conformity with its WTO obligations, including 
Articles VIII:1(a), XI:1 and III:2 and 4 of the GATT 1994 and its commitments in its Schedule on 
Services, and that it would also implement such la ws and regulations in full conformity with these 
obligations.  The Working Party took note of this commitment. 
IMPORT REGULATION  
- Import Regime  
92. In response to a specific question, the repr esentative of Saudi Arabia stated that the 
application of secondary and tertiary boycotts ha d been terminated by the Council of Ministers 
Decision No. (5) dated 13 June 1995. 
- Customs Tariff  
93. The representative of Saudi Arabia informed members of the Working Party that, according 
to Article 20 of the Basic Law of Government, the authority for setting customs tariffs and for any 
changes thereto, and for levying any surcharges, rests with the Council of Ministers.  Imposition, WT/ACC/SPEC/SAU/4/Rev.3 
Page 36  
 
 amendment or abrogation of customs tariffs requires issuance of a Decree by the Council of Ministers 
that is endorsed by a Royal Decree. 
94. The representative stated that Saudi Arabia  used HS 2002 for classification of goods for 
customs purposes.  There were 7,177 tariff lines at the 8-digit level.  The first six digits corresponded 
to the HS while the last two digits were specific to Saudi Arabia. 
95. The representative of Saudi Arabia said that cu stoms tariff rates of Saudi Arabia had been 
declining.  When Saudi Arabia applied for accession in 1993, about 75 per cent of its tariff lines were 
subject to tariffs of 12 per  cent, while about 6 pe r cent of its tariff lines carried duties of 20 per cent 
or 50 per cent.  Since 1 January 2003, Saudi Arab ia had applied the GCC common external tariff 
within the framework of the GCC Customs Union.  More than 85 per cent of the tariff lines carried 
duties of 5 per cent or 0 per cent.  Of the remaining (roughly) 14 per cent of the lines, 7 per cent 
carried duties of 12 per cent, 6 per cent carried du ties of 20 per cent and 20 tariff lines (i.e., tobacco 
and tobacco-related products) carried duties of 100 pe r cent.  Imports of the remaining 70 lines (i.e., 
alcohol and pork) were banned for religious reasons.  In response to a question from a member of the 
Working Party, he said that duties were applied on CIF basis. 
96. The representative of Saudi Arabia stated th at taking into account its own needs and the 
interests of members of the Working Party, his Government had offered ex tensive bindings in its 
tariff, on practically all tariff lines.  The only exceptions were the tariff lines concerning pork and 
alcohol, the production, consumption, import and sal e of which was prohibited in Saudi Arabia for 
religious reasons. 
97. [Following the completion of bilateral negotia tions with WTO Members, Saudi Arabia's 
Schedule of Concessions and Commitments on Goods will be reproduced in Part I of the Annex to the 
Protocol of Accession of Saudi Arabia.] 
Tariff Rate Quotas and Tariff Exemptions
 
98. In response to questions raised by members of the Working Party, the representative of 
Saudi Arabia stated that Saudi Arabia did not appl y tariff rate quotas and had no intention to do so in 
the future, except as might be permitted under Article XIX of the GATT and the WTO  Agreement on 
Safeguards. 
99. The representative of Saudi Arabia further stated  that Section VIII, Articles 98 to 105 of the 
Common Customs Law of the GCC States, adopted 27-29 November 1999 (implemented from 2002), provided for the following tariff exemptions:  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 37 
 
 
 i. Imports by diplomatic missions and by diplomats. 
ii. Imports of arms, ammunition, military equipment and other materials by military 
forces and by internal security forces. 
iii. Imports by philanthropic societies. iv. Goods exported or re-expor ted from Saudi Arabia and subsequently returned to 
Saudi Arabia (Returned Goods). 
v. Personal effects and household ite ms imported as passenger's baggage. 
Other Duties and Charges
 
100. The representative of Saudi Arabia stated that  Saudi Arabia was applying "other duties and 
charges" within the meaning of Article II.1(b) of the GATT 1994 on 22 tariff lines in HS Nos. 2401, 
2402 and 2403, which had been shown in Saudi Ar abia's revised offer of June 1999.  The 
representative of Saudi Arabia confirmed that ODCs on these 22 tariff lines would be bound at the rates shown in its June 1999 offer. 
101. He further confirmed that Saudi Arabia would not list other duties and charges in its Schedule 
of Concessions and Commitments on Goods under Artic le II.1(b) of the GATT 1994 on all other tariff 
lines, except the 22 tariff lines of HS Chapter 24, and would bind such other duties and charges at 
zero.  The Working Party took note of this commitment. 
Fees and Charges Connected with Importation (for Services Rendered)
 
102. The representative of Saudi Arabia stated that Saudi Arabia did not impose or charge any fees 
or charges for port clearance, customs processing, customs inspection or import or export licenses.  
He said that there was a small fee of SAR 20, which corresponds to the costs of the customs 
declaration form and use of Customs' computers to complete the declaration form.  He said that fees 
for loading, unloading and handling of import a nd export cargoes were charged by private-sector 
operators.  These fees were not imposed by the government. 
103. The representative of Saudi Arabia stated that if goods were left in the Customs sheds and 
were not cleared after a delay of 13 days from the date of unloading, storage charges at the following 
nominal rates were levied: 
i. SAR 10 per ton per day for the firs t month of delay (after 13 days). 
ii. SAR 20 per ton per day for the second month. iii. SAR 40 per ton per day for subsequent months. 
However, no charges were levied if the delay w as not caused by the importer, e.g., the delay in 
clearing the goods was due to:  WT/ACC/SPEC/SAU/4/Rev.3 
Page 38  
 
 i. The Customs Department. 
ii. A natural disaster. iii. An official holiday. 
104. In response to questions from members of the Wo rking Party, the representative noted that the 
fees described in the section on Other Customs Fo rmalities also reflected the costs of services 
rendered and that, in accordance with Article V III:3 of the GATT 1994, Saudi Arabia would not 
impose substantial penalties for minor Customs breaches. 
105. Members asked about fees imposed by Saudi Arabia for notarization or  consularization of 
documents.  In response, the representative of Saudi Ar abia stated that authentication of certificates of 
origin and of invoices by Saudi consulates or by Chambers of Commerce was a general requirement 
imposed pursuant to Council of Ministers Order No . 5 dated 3.01.1406H (18.09.1985).  He noted that 
the requirement applied to various types of docum ents, not merely to trade documents.  The fee 
collected by the Ministry of Foreign Affairs for c onsularization was nominal, at US$ 8 per document.  
The practice was necessary, he said, to combat commercial fraud and to ensure that products 
prohibited for health reasons were  not exported to Saudi Arabia. 
106. A member of the Working Party asked Saudi Arabia to explain requirements that are applied 
to imports of non-unitized cargo such as rice, in partic ular the port levy fee that is applied to such 
cargo.  In response, the representative of Saudi Arabia  stated that this levy was applied to compensate 
for the labour costs involved in unloading containers  for customs inspection.  The Member further 
asked whether such inspection was necessary given mo re modern methods of inspection, and asked 
Saudi Arabia to review these requirements.  Th e representative of Saudi Arabia stated that 
Saudi Arabia would review its inspection system in the context of its ongoing process of modernization. 
107. The representative of Saudi Arabia confirmed th at any fees or charges on imports for services 
rendered would be in accordance with Article V III of the GATT 1994.  The Working Party took note 
of this commitment. 
Import Licensing Systems
 
108. In addition to information contained in th e Memorandum on the Foreign Trade Regime, the 
representative of Saudi Arabia provided a detaile d description of the import licensing procedures 
prevailing in Saudi Arabia in document WT/ACC/S AU/30, together with the justification for the 
measures in document WT/ACC/SAU/29/Add.3.  He al so noted that additional information could be 
obtained from the concerned department or division of the respective Ministry or from the  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 39 
 
 
 Information Centre of the Ministry.  The information could also be obtained from the Chamber of 
Commerce and Industry.  He also noted that any person with a Commercial Registration 
(i.e., registration to do business), whether an indivi dual or an entity, could apply for import license. 
109. Some members of the Working Party requested information on the proportion of Saudi 
imports subject to licensing.  In response, the repr esentative of Saudi Arabia stated that no statistics 
were available to answer that question.   
110. The representative of Saudi Arabia confirmed that  in addition to the Ministry of Agriculture, 
Ministry of Commerce and Industry, Ministry of  Health, Ministry of Information and Culture, 
Ministry of Interior, and Ministry of Petroleum and Natural Resources, the Ministry of Education 
(Department of Museums and Archaeology), the Ministry of Telecommunication and Information Technology, and the National Commission for Wild Life Conservation and Development (NCWCD) 
and the Chivalry Club all had responsibilities concer ning the approval of import licenses.  He also 
confirmed that there were no substantive requirement s to register with the Ministry of Commerce and 
Industry in order to import, although there was a requirement to obtain Commercial Registration for 
the carrying on of business, whether manufacturing, retailing, trading, or professional.  Any company, 
whether Saudi or foreign, which was commercially re gistered in the field of import trade could import 
goods without the need to get any further permission or authorization, except for items which required 
an import license. 
111. In response to further questions, he noted th at the Chivalry Club would grant an import 
license for the importation of non-Arabian horses, after clearance by the Department of Animal and 
Plant Quarantine at the Ministry of Agriculture and Water, within 30 days of receipt of a complete 
application.  In this connection, some members of  the Working Party requested additional information 
on the time limits for grant of other import licenses.  These members noted, in particular, that Article 3.5(f) of the  Agreement on Import Licensing provided that ordinarily an import license must 
be granted within 30 days of receipt of a complete  application.  These members noted that for some 
categories of goods, import licenses took longer than  30 days, in particular, radio communication 
apparatus (one to two months) a nd network equipment (six to twelve months).  These members noted 
that the importation of such products was also subject  to approval by the Frequency Department of the 
Department of Post, Telegraph a nd Telephone.  In response, the representative of Saudi Arabia stated 
that the Frequency Department ordinarily comple ted its review in one week.  If a product met the 
frequency and necessary technical specifications, the Licensing Committee would ordinarily decide whether to grant an import license within 30 days. WT/ACC/SPEC/SAU/4/Rev.3 
Page 40  
 
 112. In response to further questions from a member of the Working Party regarding import 
licensing for telecommunication equipment, the representative of Saudi Arabia furnished the 
following information: 
(i) In accordance with Article 39 of the Telecommunication Act and Article 3 of the 
Rules and Procedures of Pleading before the Bureau of Grievances, the procedure of 
appeal for a license applicant would be 90 days, starting from the day the appeal was 
submitted to the Minister of Telecommunication and Information Technology.  The 
appeal must be submitted within 60 days of the applicant's notification of the rejection of his/her application.  If the 90 days expired with no response, the appeal 
would have been rejected. A case may be filed before the Bureau of Grievances to invalidate the Minister's 
decision within 60 days of the applicant's notification of the rejection of his/her 
appeal, or of the expiration of the 90 day period with no response.  The time for the Bureau of Grievances to issue a deci sion depends on the nature of each case. 
(ii) ITU standards are generic and cover a wi de range of specifications.  Saudi Standards 
are in line with the ITU Standards, and cover local requirements.   
(iii) If an allocated frequency is not used in  two months' time, it will be recovered.  
However, if it is used within that peri od, the license of the radio communication set 
and frequency will be extended 12 months. 
113. Members of the Working Party also asked Sa udi Arabia to clarify the grounds for, and 
particulars of, its import licensing regime for Chiv alry Club.  The representative from Saudi Arabia 
clarified that the regime was necessary to preserve a policy of great importance to the Kingdom.  The 
regime allowed the Saudi authorities to closely monitor the importation of non-Arabian horses to 
ensure the preservation of the blood lines of the Arab ian horse stock in Saudi Arabia.  He explained 
that, only by closely monitoring imports of live horses, could this be ensured. 
114. In response to requests for information concerning the fees payable for obtaining an import 
license, the representative of Saudi Arabia stated th at there were no fees payable for the obtaining of 
an import license; Saudi ministries, including the Ministries of Agriculture, of Health and of Commerce and Industry, did not charge fees for import licensing procedures, including the application process.  Companies or persons wishing to import me rchandise for display at a trade fair were granted 
import licenses that permitted the importation of all necessary samples, subject to the condition that 
the samples not be offered for direct sale. 
115. Some members of the Working Party requested information on the precise laws and 
regulations governing the time limits for issuing an import license.  In response, the representative of 
Saudi Arabia stated that there were no laws or administrative orders governing the issuing of import 
licenses.  Average time periods for the issuing of import licenses were around 30 days.  In the event of 
an unsuccessful application for an import license, the person requesting the license could appeal the 
refusal to the Board of Grievances.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 41 
 
 
 116. A member of the Working Party asked about the timing of appeals of decisions by particular 
ministries to reject an application.  The Saudi representative confirmed that the entire procedure for 
appeal (including re-appeal) to the Ministry of Hea lth generally would take thirty working days to 
complete.  He further stated that the process of appeal at the Ministry of Commerce and Industry 
depended upon the completion of the licensing requirement s by the importer, i.e., if the importer were 
to complete the requirements, the license would be issued upon completion.  In the case of chemicals, 
he reported, the issuance process would take one day; for distillation equipment, the process would 
require from two to three days.  With regard to app eals to the Ministry of Agriculture, he stated that 
the process for the procedure of a ppeal, when the documents are correct and complete, requires only 
one day in most instances. 
117. In response to further requests for information,  the representative of Saudi Arabia noted that 
decisions to not grant an import license could first be appealed to the Minister of the concerned 
Ministry or to the head of the Agency concerned.  Any subsequent appeal would be to the Board of 
Grievances.  (See paragraphs 69 and 70 regarding the composition and workings of the Board of 
Grievances.) 
118. Some members of the Working Party asked whether petroleum and natural asphalt were 
subject to import licensing and requested that Saudi Arabia provide the justification pursuant to the 
relevant provisions of the WTO  Agreement for the maintenance of import licensing on those products.  
In response, the representative of Saudi Arabia stat ed that petroleum products, including asphalt, were 
previously subject to import licensing, but now th ere was no WTO-inconsistent restriction on such 
imports. 
119. In response to questions from some members of the Working Party, the representative of 
Saudi Arabia stated that the import of fire ex tinguishers required a license from the Ministry of 
Interior.  He also noted that high-quality photocopiers required an import license from the Public 
Security Department of Forgery.  This was because such photocopiers could produce extremely high-
quality reproductions of documents, making it hard to differentiate between the original and the 
photocopies of paper currency and official documents , certificates, passports, maps and stamps.  He 
also noted that burglar or fire alarms required an import license to prevent misuse by criminals or 
terrorists.  For this reason import licenses were  only issued to government enterprises, public 
enterprises and firms or individuals who had a cont ract with the government to supply such security 
devices from inside the Kingdom or abroad.  So me members of the Working Party requested 
additional information on the justification for the import licensing requirements for security reasons.  
The representative of Saudi Arabia stated that those measures were necessary in order to prevent WT/ACC/SPEC/SAU/4/Rev.3 
Page 42  
 
 import and the misuse of the items by persons who could pose a security risk.  The Ministry of the 
Interior was the agency that determined whether th e importer posed a security risk or not.  The list of 
items subject to import licensing was under review, and in this context he noted that the requirement 
for import licensing of fire fighting equipment had r ecently been lifted.  Fire-fighting equipment could 
now be imported without a license, following a cust oms examination to determine compliance with 
Saudi or international standards. 
120. Some members of the Working Party requested  information on the system for licensing the 
importation of agricultural machinery.  The represen tative of Saudi Arabia stated that the import 
licensing system for import of agricultural equipment was operated in order to administer a system of 
subsidies paid to importers of such equipment.  The import license was required even if the importer 
did not intend to apply for a subsidy payment. 
121. One member of the Working Party inquired as to the procedures for medical products, 
including pharmaceuticals.  In response, the represen tative of Saudi Arabia stated that no import 
license is required for approved pharmaceutical and medical products.  He reported that 
pharmaceutical or medical products not previously  approved are subject to an approval process 
designed to evaluate the product and ensure that the manufacturer follows good manufacturing 
practices (GMP).  The representative reported th at this process may take up to 18 months. 
122. One member of the Working Party inquired as to the procedures for medical products, 
including pharmaceuticals.  In response, the represen tative of Saudi Arabia stated that no import 
license is required for approved pharmaceutical and medical products.  He reported that 
pharmaceutical or medical products not previously  approved are subject to an approval process 
designed to evaluate the product and ensure that the manufacturer follows good manufacturing 
practices (GMP).  The representative reported th at this process may take up to 18 months. 
123. A member of the Working Party observed that commercial importers of chemicals required a 
license from the Ministry of Commerce whereas impor tation of chemicals for factories required a 
license from the Ministry of Industry and Electricity .  The member observed that the same chemicals 
were imported for both commercial and factory purpo ses and that the treatment for the two should not 
be different.  The representative of Saudi Arabia  explained that the procedures had now been 
streamlined and that now the Ministry of Comme rce and Industry was responsible for licenses for 
import of chemicals for company and factory use. 
124. A member of the Working Party asked Saudi Arabia to explain its reasons for requiring 
import licenses for certain "distillation equipment."  In response, the representative of Saudi Arabia  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 43 
 
 
 stated that, in the past, imported distillation equipmen t had been used to produce alcoholic beverages.  
He explained that, as the production of alcoholic be verages was prohibited under Saudi law (Shariah), 
the Kingdom of Saudi Arabia had decided to regulat e imports of distillation equipment to address the 
problem. 
125. A member of the Working Party inquired as to procedures regarding pesticides.  The 
representative of Saudi Arabia replied that import licenses for pesticides are valid for six months (or 
for the remainder of the registration period) because th is assists the Ministry of Agriculture in tracking 
the quantities of imports of potentially harmful substa nces, and for statistical tracking purposes.  Also, 
he reported, the system helps ensure that importers ' registration documents are valid during the period.  
He further stated that, if an application is rejected  for any reason, the applicant can appeal the decision 
to the Ministry, which will issue a license as soon as the applicant had satisfactorily completed the 
necessary documentation. 
126. A member of the Working Party asked for de tails regarding the licensing procedures for 
veterinary drugs, vaccines, feeds and domestic animals.  In response the representative of 
Saudi Arabia reported that, if the documents are correct and complete, the process for appeal and 
issuance of the license by the Ministry of Agriculture  would take one day.  He further explained that 
the use of the term "feed additives" indicated th at the provision in question applied only to feed 
additives and did not apply to feeds, and that a license was required to import other domestic animal 
related products. 
127. A member of the Working Party asked Saudi Arab ia to clarify its regime as it applies to seeds 
and fertilizers.  In response, the representative of Saudi Arabia noted the process of the Ministry of 
Health's examination and approval of an applicati on for import license, or of an appeal (re-appeal), 
would take only one day where the documentation w as complete.  He reported that organizations 
permitted to provide a health certificate for seeds and fertilizers included the governmental authorities 
in the country of origin, as well as official laboratori es in the country of origin that had been approved 
by the Ministry of Agriculture.  Also, he reported, such certificates are issued by the Saudi Ministry of 
Health and are easily obtained where the products are free of pests and diseases.  Regarding the specifications used by SASO to determine whethe r to approve an application for import license for 
seeds, the representative confirmed that the list of  requirements had been submitted to the Working 
Party ("SASO Seed Specifications," attached to the Working Party Report at Annex D).  The time 
limits for import licenses were based on the need to ensure that the Ministry of Agriculture could 
ensure the validity of importers' registration documen ts and to allow Saudi authorities to track import 
levels of seeds and fertilizers for statistical purposes. WT/ACC/SPEC/SAU/4/Rev.3 
Page 44  
 
 128. In response to questions from some members of the Working Party, the representative of 
Saudi Arabia provided an Action Plan for the Implementation of the Import Licensing  Agreement in 
document WT/ACC/SAU/40.  At a later stage, he stated that the Action Plan had been fully 
implemented and that the Council of Ministers issued Decision No. 84 in July 2000 and Decision No. 88 in July 2002 to implement the WTO  Agreement on Import Licensing Procedures.  The Import 
Licensing Law issued vide Council of Ministers Decision No. 88 of 6.4.1432H (July 2002) 
incorporated into Saudi law the provisions of the WTO  Agreement on Import Licensing Procedures.  
The salient features of the new Law were:  
i. Persons, firms and institutions eligible to  make applications for import licenses are:  
(a) Saudi, foreign or joint venture compani es registered under Saudi laws; (b) natural 
persons registered in the Commercial Re gister; and (c) Saudi nationals and non-
Saudis holding residence permits, without commercial registration, provided they 
apply to import goods for their personal use. 
ii. Imports by categories (a) and (b) will be  limited to goods related to the scope of 
business inscribed in their commercial registration. 
iii. Applications for automatic import li censing may be submitted on any working day 
prior to the customs clearance of goods.  Li cense will be issued within a maximum of 
10 days form the date of application. 
iv. Applications for non-automatic import licences may be submitted within 21 days 
prior to the closing date of applications.  Licenses will be issued within a period of 
30 days from the date of application. 
v. Applications would not be rejected for minor variations in value or minor 
documentation errors. 
vi. License applicants have to approach onl y one administrative body.  If necessary, that 
body would coordinate with other administrative bodies. 
vii. Non-automatic licensing is required fo r imports subject to quantitative or other 
restrictions (Saudi Arabia applies no quotas). 
viii. Article 9 of the Law contains detailed provisions on allocation of quotas in line with 
the provisions of Article 3 of the  Agreement on Import Licensing Procedures 
(Saudi Arabia applies no quotas). 
ix. The Law requires publication in the Official Gazette of the amount of quotas and any 
changes thereto at least 30 days prior to the date of application (Saudi Arabia applies 
no quotas). 
x. In case of refusal of applications, th e reasons for refusal will be provided upon 
request of the applicant. 
xi. Right of appeal to the Head of the administrative body is provided for, within a 
period of 15 days from the date of refusal.  A further right of appeal to the Board of Grievances against the decision of the Head of the administrative body is provided for, within 30 days from the date of the decision. 
129. Members of the Working Party asked Saudi Arab ia to provide a list of products subject to 
automatic and non-automatic import licensing require ments.  The representative of Saudi Arabia 
stated that Saudi Arabia did not subject any imports to automatic licensing; a list of imports subject to non-automatic licensing requirements was attached at  Annex E.  In addition, he confirmed that  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 45 
 
 
 Saudi Arabia had appended to the Working Pa rty Report its response to the questionnaire 
"Information on Import Licensing Procedures." 
130. The representative of Saudi Arabia confirmed th at Saudi Arabia would, from the date of 
accession, eliminate and not introduce, re-introduce or apply non-tariff measures such as licensing, 
permits, prior authorization requirements, licen sing requirements and other restrictions having 
equivalent effect that cannot be ju stified under the provisions of the WTO  Agreement.  Any further 
amendments to the import licensing regime afte r accession would be fully in accordance with all 
relevant provisions of the WTO, including the  Agreement on Import Licensing Procedures.  The 
representative added that Saudi Arabia no longer requi red licensing for "milk for industrial use."  He 
further confirmed that any discretionary authority permitting officials of the Kingdom of Saudi Arabia 
to suspend imports and expor ts or licensing requirements that could suspend, ban, or otherwise restrict 
the quantity of trade would be applied from the da te of accession in conformity with the requirements 
of the WTO, in particular Articles XI, XII, XIII, XVIII, XIX, XX and XXI of the GATT 1994, and the Agreements on Agriculture, Application of Sa nitary and Phytosanitary Measures, Import 
Licensing Procedures, Safeguards and Technical Barriers to Trade.  The Working Party took note of 
these commitments. 
Quantitative Import Restrictions, Including Prohibitions and Quotas
 
131. In response to questions from members of the Working Party, the representative of 
Saudi Arabia supplied details rega rding quantitative restrictions maintained in Saudi Arabia.  In 
addition to information contained in the Memorandum on the Foreign Trade Regime, the 
representative of Saudi Arabia provided a list of restricted (banned and controlled) items in 
Saudi Arabia, together with the justification fo r the measures in document WT/ACC/SAU/29/Add.3.  
This list was later updated by the lis t of banned imports attached at Annex F.  He also noted that 
additional information could be obtained from the c oncerned department or division of the respective 
Ministry or from the Information Centre of the Ministry.  The information could also be obtained 
from the Chamber of Commerce and Industry. 
132. Certain members of the Working Party requested further details of quantitative import 
restrictions, including those on certain imports of the following products:  long-life pasteurized milk 
in packing exceeding 1 litre (tariff item 0401.00.00); dates; rice; poultry, beef and lamb; offal; 
therapeutic medicines used in animal feed; le ntils; and certain tires.  The representative of 
Saudi Arabia noted that Saudi Arabia had taken a series of actions to comply with WTO provisions.  
He provided the following responses: WT/ACC/SPEC/SAU/4/Rev.3 
Page 46  
 
 i. Long-Life Pasteurized Milk - Saudi Arab ia had removed the import ban and replaced 
it with a tariff. 
ii. Dates - Saudi Arabia had removed the import ban and replaced it with a tariff. 
iii. Rice from the United States - Saudi Arabia did not ban imports of rice from the 
United States. 
iv. Poultry, Beef and Lamb from the United St ates - Saudi Arabia did not ban imports of 
poultry, beef or lamb from the United States. 
v. Offal - Ministry of Commerce and Industry Decision No. 1308, dated 27.5.1424H 
(27.7.2003), permitted imports of offal from countries with livestock free of infectious diseases. 
vi. Therapeutic Medicines Used in Animal Feed - The Ministry of Agriculture was 
studying this issue to ensure the protection of domestic livestock. 
vii. Lentils from Australia - The ban on le ntils from Australia had been lifted after 
the Agreement between Saudi Arabia and Au stralia had been signed.  The ban, and 
the problem that occasioned it, had been th e subject of successful bilateral discussions 
between Saudi Arabia and Australia.  Saudi Arabia and Australia had agreed that the 
ban would be lifted and that Austra lia would certify future shipments. 
viii. Tires - The Ministry of Commerce and Industry had banned imports of certain tires 
following a series of fatal accidents in the United States caused by design and/or manufacturing issues.  The action had been ta ken due to public safet y concerns and in 
light of the fact that, given the climate of Saudi Arabia, similar accidents would be 
even more likely to occur ther e than in the United States.  The Ministry requested the 
investigation results from the concerned U.S. authorities and, in the meantime, took the prudential action of banning imports of t hose tires, pending review of the results.  
The ban was limited to those tire models, produced at specific facilities, which were most similar to the tires involved in the accidents.  The ban, therefore, applied only to 
the certain tire models and sizes, produced at  certain facilities.  The representative of 
Saudi Arabia noted that specific information was available on request. 
133. The representative of Saudi Arabia confirmed th at Saudi Arabia would, from the date of 
accession, eliminate and not introduce, re-introduce or  apply quantitative restrictions on imports or 
other non-tariff measures such as licensing, quotas, bans, permits, prior authorization requirements, 
licensing requirements and other restrictions having equivalent effect that cannot be justified under 
the provisions of the WTO  Agreement.  Any further changes to Saudi law after accession would be 
fully in accordance with all relevant provisions of the WTO.  He further confirmed that any 
discretionary authority permitting officials of the Kingdom of Saudi Arabia to suspend imports and 
exports or otherwise restrict the quantity of tr ade would be applied from the date of accession in 
conformity with the requirements of the WTO, in particular Articles XI, XII, XIII, XVIII, XIX, XX and XXI of the GATT 1994, and the  Agreements on Agriculture, Application of Sanitary and 
Phytosanitary Measures, Import Licensing Procedures,  Safeguards and Technical Barriers to Trade.  
The Working Party took note of these commitments. 
Customs Valuation
 
134. Some members of the Working Party stated that  the system of valuation described in the 
Memorandum on the Foreign Trade Regime, in Annex 4 to document WT/ACC/SAU/4 and in  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 47 
 
 
 document WT/ACC/SAU/18 did not appear to fully comply with certain requirements of the Customs 
Valuation  Agreement.  Some members requested that a number of areas of the customs valuation 
regime receive further elaboration so that they were in conformity with the WTO  Agreement on 
Implementation of Article VII of the GATT 1994, its Interpretative Notes, and relevant decisions and 
declarations.  In particular, members noted that in  addition to problems related to transparency or 
predictability, Saudi Arabia's valuation system relied on the "nearest equivalent value" as an 
alternative to transaction value.  This could give customs officials excessively wide discretion in their 
determination of customs value of the impor ted goods.  In response, the representative of 
Saudi Arabia stated that from the date of accession to the WTO, Saudi Arabia's system of Customs 
Valuation would be in full conformity with the provisions of the WTO  Agreement on Customs 
Valuation. 
135. Concerning Article 11 of the Customs Valuation  Agreement and the right of appeal to a 
judicial authority, the representative of Saudi Arabia  stated that appeal rights for a relevant person 
before an independent judicial body (i.e. the Bo ard of Grievances) was guaranteed by Royal Decree 
No. 190 dated 16 Dhu Al-Hujah 1409H (19 July 1989).  This applied to the Customs Department.  
The requirements of Article 12 concerning publica tion of laws, regulations, and decisions were 
satisfied by provision 65 of Royal Decree No . 425 dated 5/3/1372H (22 November 1952), which 
required that such information be published in the official gazette Umm Al-Qura  along with all other 
government notices such as changes in rates of duty.   The representative of Saudi Arabia noted that 
Article 26 of the Customs Valuation Law and Artic le 1.3 of the Rules of Implementation of the 
Customs Valuation Law implemented Article 11 of the Customs Valuation  Agreement.  He confirmed 
that Decisions 3.1 and 4.1 of the Customs Va luation Committee would be implemented through 
executive order not later than the date of accession. 
136. Concerning the use of minimum values fo r customs purposes, the representative of 
Saudi Arabia stated that Saudi Arabia would wish  to make a reservation unde r paragraph 2 of Annex 
III to the  Agreement on Customs Valuation to continue the use of minimum values for a handful of 
products now under this system.  This would be necessary, because although Saudi Arabia would 
ultimately discontinue the system, it would need a transitional time for this purpose as it would have 
to study carefully the implications of the cha nge, and to devise procedures for checking practices 
which necessitate the use of minimum values.  The flexibility required would be needed for two years 
from the date of accession to the WTO.  In the inte rim, Saudi Arabia would undertake a careful study 
in the first year of implementation to devise pr ocedures for discontinuing the minimum values.  In 
response to questions from members of the Working Party, the representative of Saudi Arabia stated WT/ACC/SPEC/SAU/4/Rev.3 
Page 48  
 
 that Saudi Arabia was using and wished to continue using minimum values for the following 
products: 
HS 21.02 - Yeast 
HS 40.11 - Tires 
HS 57.01 - Carpets 
HS 57.02 - Carpets HS 60.01 - Blankets HS 85.25 - Mobile phones 
137. Members asked the reason why Saudi Arabia was seeking a reservation to allow it to maintain 
minimum values for these products.  In response, the representative of Saudi Arabia cited the massive 
under-valuation of imports of these items.  Saudi Customs authorities have found it exceedingly difficult to check the undervaluation, despite the provisions of Article 17 of the Customs 
Valuation  Agreement and paragraph 6 of Annex III to this  Agreement.  Therefore, the reservation was 
necessary to assist Saudi authorities in this effort. 
138. The representative of Saudi Arabia also noted  that Saudi Arabia would seek a reservation 
under paragraphs 3 and 4 of Annex III to the Customs Valuation  Agreement.  The justification for that 
request was that, because the Customs Administration of Saudi Arabia had not reached the level of 
sophistication and expertise of developed countries, it would not be possible for it to apply the 
relevant provisions of the Customs Valuation  Agreement before that date.  The reservation would 
continue to be applicable for an indefinite period.  Following accession to the WTO, Saudi Arabia 
would undertake studies to determine if it was feasible to lift the reservations. 
139. At a later stage, the representative of Saudi  Arabia stated that the Action Plan on 
Implementation of the Customs Valuation  Agreement circulated in document 
WT/ACC/SAU/38/Rev.1 had been completed, that Cu stoms officials and brokers had been trained 
and necessary laws and regulations on Customs Valuati on had been promulgated.  He confirmed that 
Saudi Arabia was able to implement the Customs Valuation  Agreement from the date of its accession 
to the WTO.  The representative of Saudi Arab ia submitted the Common Customs Law of the GCC 
States and the Rules of Implementation, which contained the new WTO-consistent system of valuation.  Articles 26, 27 and 28 of the Law and Ar ticle 1 of the Rules of Implementation deal with 
customs valuation.  These were consistent with the provision of the Customs Valuation  Agreement.  
The representative said that Saudi Arabia had a pplied the new Common Customs Law and the Rules 
of Implementation with effect from 1 January 2003.  Saudi Arabia thus already had implemented the 
WTO Customs Valuation  Agreement, except in regard to the minimum values for the products noted 
above.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 49 
 
 
 140. The representative of Saudi Arabia stated that , with regard to Article 20 of the Customs 
Valuation  Agreement, the Kingdom of Saudi Arabia would implement the provisions of the 
WTO  Agreement on Implementation of Article VII of GATT 1994 (concerning customs valuation) in 
full from the date of accession to the WTO, without recourse to any transition period.  (Saudi Arabia would avail itself of a transition period for use of minimum values and would seek a reservation with regard to paragraphs 3 and 4 of Annex III of the Customs Valuation  Agreement, as noted above.)  In 
this regard, the Customs Law and implementing regul ations fully reflected the requirements of Annex 
1 of the Interpretative Notes of the  Agreement on the Implementation of Article VII of the 
GATT 1994 and Decision 4.1 on the Valuation of Carrier Media Bearing Software for Data 
Processing Equipment.  He stated that all methods of  valuation used would be in strict conformity 
with those provided for in the WTO  Agreement on the Implementation of Article VII of the 
GATT 1994.  The Working Party took note of this commitment. 
Rules of Origin
 
141. The representative of Saudi Arabia stated that Sa udi Arabia did not have rules of origin for 
non-preferential trade but any future rules w ould be implemented in accordance with the 
WTO  Agreement on Rules of Origin.  In response to requests for information, the representative of 
the Kingdom of Saudi Arabia stated that certificates of origin attested by the Saudi Embassy or Consulate were necessary for importation of preferential trade items.  Where no Saudi Embassy or Consulate existed, such certificate would be attest ed by the Chambers of Commerce in the exporting 
country.  Other requirements included minimum content from within the preferential system.  From 
1996 all imports of expensive tex tile products had been required to  have the origin of the goods 
printed or stamped thereon with indelible print.   This requirement was introduced to protect 
consumers against misleading or deceptive practices.  A textile product was deemed to be "expensive" 
depending on an analysis of factors such as the qua lity the brand name, texture, design and the price 
relative to other fabrics. 
142. The representative of Saudi Arabia stated th at, from the date of accession, Saudi Arabia's 
preferential and non-preferential rules of origin would comply fully with the WTO  Agreement on 
Rules of Origin.  The requirements of Article  2(h) and Annex II, Pa ragraph 3(d) of the  Agreement 
would also be fully implemented prior to accession.  He also stated that in any event, from the date of 
accession, the Customs authorities would provide an  assessment of the origin of the import upon the 
request of an exporter, importer or any person with  a justifiable cause.  An y request for such an 
assessment would be accepted even before trade in the goods concerned began.  Any such assessment 
would be binding for three years.  The Working Party took note of these commitments. WT/ACC/SPEC/SAU/4/Rev.3 
Page 50  
 
 Other Customs Formalities
 
143. Some members of the Working Party stated that consular authentication of customs 
documents in the country of export was a common practice in Saudi Arabia's region.  Such 
requirements were often unnecessary burdens placed on exports and used to collect additional 
consular fees.  They requested Saudi Arabia to c onfirm that authentication of customs documents by 
its consulates or Chambers of Commerce was not  required in the exporting country and that no 
additional fees were charged.  In response, th e representative of Saudi Arabia stated that 
authentication of certificates of origin and of invoices by Saudi consulates or by Chambers of Commerce was a general requirement imposed pursu ant to Council of Ministers Order No. 5 dated 
3.01.1406H (18.09.1985), that applied to various types of documents, not merely to trade documents.  
The fee collected by the Ministry of Foreign Affairs for consularization was nominal, at US$ 8 per 
document.  The practice was necessary, he said, to  combat commercial fraud and to ensure that 
products prohibited for health reasons were not exported to Saudi Arabia.   
Other Border Measures
 
144. Members of the Working Party asked Saudi Arab ia to describe the new customs procedures, 
following the establishment of the GCC Customs Uni on, particularly as they related to goods first 
imported through other GCC member states.  One member of the Working Party observed that in some cases Saudi Arabia had turned back imports des tined for its market that first entered through and 
paid duties in other GCC member states.  The repr esentative of Saudi Arabia stated that all customs 
procedures (i.e., lodgment of the customs declaration, inspection of the goods, assessment and 
collection of customs duties) were conducted in th e first GCC member state where the goods entered 
from outside the GCC.  Goods destined for anothe r GCC member state, after completion of customs 
formalities in the first GCC state, were allowed to leave after affixing customs seals and accompanied 
by a copy of the customs import declaration show ing the value of the goods and payment of duty.  
There was no further assessment and collection of duty in the country of final destination.  The 
representative said that in the absen ce of specifics and details it was difficult to say if and why the 
imports were turned back.  It might be that th e seals were not intact or the consignment was not 
accompanied by the customs declaration or, for example, the import of goods were banned in 
Saudi Arabia but not in the GCC state of first importation ( e.g., alcoholic beverages). 
145. Members of the Working Party asked Saudi Ar abia to describe how duties collected were 
apportioned to various GCC member states.  The repr esentative of Saudi Arabia explained that for the 
first three years following the establishment of the GCC Customs Union, the duties would be  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 51 
 
 
 apportioned according to the final destination of th e goods.  The arrangement would be reviewed after 
the transitional period of three years. 
Application of Internal Taxes  
146. A member of the Working Party asked whether Saudi Arabia would abide by the non-
discrimination provisions of Articles I and III of GATT 1994 in relation to internal taxation from the 
date of accession.  In response, the representative of Saudi Arabia stated that Saudi Arabia did not 
impose a value added tax (VAT) or an excise ta x on either domestically produced or imported 
products.  
147. The representative of Saudi Arabia confirmed that in case internal taxes were introduced, 
Saudi Arabia would apply these taxes in complian ce with Articles I and III of the GATT 1994.  The 
Working Party took note of this commitment. 
Anti-Dumping, Countervailing and Safeguard regimes  
148. Some members of the Working Party raised concerns regarding the law for the Protection and 
Encouragement of National Industry.  The representativ e of Saudi Arabia stated that the law would be 
reviewed to ensure consistency with WTO re quirements by the date of accession at the latest .   
149. Members also noted that Saudi Arabia did not currently have any trade remedies legislation 
permitting the imposition either of anti-dumping or c ountervailing duties or of safeguard measures.  
Those members requested that Saudi Arabia undert ake to not impose such measures until appropriate 
WTO-consistent legislation had been enacted.  The representative of Saudi Arabia informed the 
Working Party that a trade remedies law, which includes provisions on Anti-Dumping, Countervailing 
and Safeguard Measures, had already been passed by the Shoura Council and had been submitted to 
the Council of Ministers.  The draft trade remedi es law was consistent with WTO provisions.  After 
the enactment of the Law through a Royal Decree, the Implementing Regulations would be issued.  
The Implementing Regulations also would be cons istent with the provisions of the relevant 
WTO  Agreements.  In response to questions from memb ers of the Working Party regarding to what 
imports the law would be applied, the representativ e of Saudi Arabia stated that the law was not 
adopted to target specific imports and would provi de remedies only in situations foreseen by the 
WTO  Agreements on Anti-Dumping, Countervailing Measures and Safeguards.  Copies of the Law 
and the Implementing Regulations would be made available after their issuance.  
150. The representative of Saudi Arabia said that Saudi Arabia would not apply any anti-dumping, 
countervailing or safeguard measures to impor ts from WTO Members until it had notified and WT/ACC/SPEC/SAU/4/Rev.3 
Page 52  
 
 implemented appropriate laws in confor mity with the provisions of the WTO  Agreements on the 
Implementation of Article VI, on Subsidies and Countervailing Measures and on Safeguards.  He 
confirmed that Saudi Arabia would ensure that such  legislation would be in full conformity with the 
relevant WTO provisions, including Articles VI and XIX of the GATT 1994 and the  Agreement on 
the Implementation of Article VI, the  Agreement on Subsidies and Countervailing Measures and 
the Agreement on Safeguards.  After such legisla tion was implemented, Saudi Arabia would only 
apply any antidumping duties, countervailing duties a nd safeguard measures in full conformity with 
the relevant WTO provisions.  The Working Party took note of these commitments. 
EXPORT REGULATIONS
 
Export Restrictions  
151. Some members of the Working Party enquired whether the Kingdom of Saudi Arabia 
maintained any export controls.  In response, the representative of Saudi Arabia stated that 
Saudi Arabia maintained no export bans, except on some items such as date seedlings, breeding 
horses, wheat and wheat flour.  Some members of the Working Party asked whether Saudi Arabia 
intended to remove those bans prior to its accession to the WTO.  In response, the representative of 
Saudi Arabia stated that there were no bans on the export of wheat and wheat flour, unless the wheat 
and wheat flour had been subsidized.  He further added that Saudi Arabia banned the export of date 
seedlings and breeding horses because the local breeds and varieties of these two items were pure and rare.  The representative indicated that a list of banned exports was attached to the Working Party 
Report at Annex G; a list of exports subject to aut horization/licensing was attached at Annex H.  He 
added that upon accession to the WTO, Saudi Arabia would do whatever was required under applicable WTO rules. 
152. A member of the Working Party commented that food imported into Saudi Arabia could not 
be re-exported without approval,  and receiving approval involved a time-consuming process.  The 
member requested that all prior approval require ments for the re-exportation of imported food be 
abolished by the date of accession.  The representativ e of Saudi Arabia said that the requirement of 
approval to re-export food would be abolished as from the date of accession.  The re-export of 
subsidized food items would be subject to repaymen t of the amount of subsidy.  The Working Party 
took note of this commitment. 
153. The representative of Saudi Arabia confirmed that from the date of accession Saudi Arabia 
would ensure that its laws, regula tions and requirements relating to the right to export and all fees, 
charges or taxes levied on such rights would be in  full conformity with its WTO obligations, including  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 53 
 
 
 Articles VIII:1(a), XI:1 and III:2 and 4 of the GATT 1994 and that it would also implement such laws 
and regulations in full conformity with these ob ligations.  The Working Party took note of this 
commitment. 
154. The representative of Saudi Arabia also confirmed that any export control requirements 
remaining in place on the date of accession would be fully consistent with WTO provisions, including 
those contained in Articles XI, XVII, XX and XXI of the GATT 1994.  The Working Party took note 
of this commitment. 
Export Duties  
155. Some members of the Working Party requested information on export duties applied by 
Saudi Arabia.  Those members noted that the export duties applied by Saudi Arabia appeared to be 
imposed only for revenue purposes and would have trade distorting effects.  In response, the 
representative of Saudi Arabia stated that Article XI of the GATT 1994 expressly permitted the 
imposition of export duties, and did not restrict the right to impose such duties.  Export duties applied only to un-tanned hides and skins, falling under HS  No. 4101, 4102 and 4103.  The rate of export duty 
was Saudi Riyals 2000 per ton. 
Export Subsidies
 
156. Members of the Working Party asked for information regarding export incentives and 
subsidies.  In response, the representative of Saudi Ar abia stated that Saudi Arabia neither maintained 
nor had any intention to provide any pr ohibited incentives or export subsidies. 
157. The representative of Saudi Arabia confirmed th at Saudi Arabia did not maintain subsidies 
including export subsidies that met the definition of  a prohibited subsidy, within the meaning of 
Article 3 of the  Agreement on Subsidies and Countervailing Measures and that it would not introduce 
such prohibited subsidies in the future.  Th e Working Party took note of this commitment. 
INTERNAL POLICIES AFFECTING TRADE IN GOODS  
Industrial Policy, Including Subsidies  
158. In response to requests for information concer ning interest free loans provided by the Saudi 
Industrial Development Fund, the representative of Sa udi Arabia stated that wholly-owned foreign 
companies, like Saudi owned companies, were also eligible for a loan of up to 50 per cent of the 
project cost.  The representative of Saudi Arabia stated that the loan programme conducted by the WT/ACC/SPEC/SAU/4/Rev.3 
Page 54  
 
 Saudi Industrial Development Fund was entir ely consistent with the GATT 1994 and the 
WTO  Agreement on Subsidies and Countervailing Measures.  The loans were not contingent upon 
export performance nor were they contingent upon the use of domestic over imported goods.  The 
decision to provide a loan was made on the basis of the facts appropriate to that particular case within 
the parameters of the Saudi Industrial Development Fund Law.  Article 2 of the Law provided that the 
Fund could provide medium or long term loans to (1) new industrial enterprises established in 
Saudi Arabia, and (2) existing private industrial ente rprises for the extension of their activities or the 
replacement of their equipment and introduction of m odern methods thereto.  Article 4 of the Law 
stated that the Fund should carry out a full evaluation of the economic benefits of the enterprise required to be financed, taking into considera tion the soundness of its management in order to 
ascertain the benefit of the industrial enterprise fro m economic, financial and technical aspects.  In 
addition, the Fund was required to examine whethe r the financing required for the whole of the 
enterprise had been reasonably obtained and whether the volume of the Fund's aid represented a reasonable percentage of the total financing need s of the enterprise, and the Fund was required to 
obtain sufficient financial guarantees for the financing given by the Fund.   
159. In response to questions from members of the Working Party, the representative of 
Saudi Arabia stated that no WTO-inconsistent s upport or subsidies had been  approved or sanctioned 
for projects involving the creation of production cap acity for refined petroleum and petrochemical 
products. 
160. The representative of Saudi Arabia confirme d that any subsidy programmes would be 
administered in conformity with the  Agreement on Subsidies and Countervailing Measures and that 
all necessary information on programmes would be notified to the Committee on Subsidies and Countervailing Measures in accordance with Article 25 of the  Agreement upon entry into force of 
Saudi Arabia's Protocol of Accession.  The Working Party took note of this commitment. 
Technical Barriers to Trade
 
161. The representative of Saudi Arabia provide d the Working Party with information on 
standards, technical standards and its Internati onal Conformity Certification Programme (ICCP) in 
documents WT/ACC/SAU/21, 26, 29, 34, 36, 37 (Rev ised Comprehensive Procedures and Guidelines 
concerning the ICCP) and 41 (Action Plan for the Implementation of the TBT  Agreement).  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 55 
 
 
 - Description of Saudi Regime  
162. The representative of Saudi Arabia further in formed members of the Working Party that 
Saudi Arabia had established and was implementing a TBT regime consistent with the provisions of 
the TBT  Agreement.  This had been done by issuing and implementing the SASO Technical Directive 
(having the force of law) on 18 July 2000.  The major features of the system were: 
i. All SASO standards, technical regul ations and conformity assessment procedures 
were and would remain fully compatible with the TBT Agreement. 
ii. SASO had established a single contact point for information (Enquiry Point) vide Part 
Four of the Technical Directive.  It al so would  provide re levant documents upon 
request. 
iii. The Ministry of Commerce and Industry was the authority responsible for making 
notifications to the WTO. 
iv. Item 2 of Part Four of the Technical Directive required a non-discriminatory and cost-
based fee structure. 
v. Items 4/5/1 of Part Two of the Technical Directive required publication of notices of 
proposed technical regulations, standards and conformity assessment procedures in 
the journal issued by SASO. 
vi. Items 3/3/1 and 4/5/4 of Part Two of the Technical Directive provided for a 60-day 
comment period and non-discriminatory consideration of comments in the preparation of final regulations. 
vii. Item 4/8 of Part Two of the Technical Directive provided for a reasonable period of 
time between the final publication and entry into force of a technical regulation. 
viii. Item 2/1 of Part Two of the Technical Directive stated that SASO would follow the 
Code of Good Practice for the preparation,  adoption and application of standards 
issued by ISO.   
ix. Item 2/3 of Part Two of the Technical Directive and Item 2 of Part Three of the 
Technical Directive provided for national treatment and non-discrimination with 
respect to products in the context of de velopment and application of technical 
regulations and conformity assessment procedures. 
x. Item 2/4 of Part Two of the Technical Directive states "Saudi voluntary and 
mandatory standards shall not create unnecessary barriers to international trade except what violates the Islamic legislation, national security requirements, 
prevention of deceptive practices, and the protection of human health or safety, 
animal or plant life or health or the protection of environment".   
xi. Item 4/9 of Part Two of the Technical Directive provided for on-going review of 
technical regulations to ensure they are a ppropriate to achieve the desired legitimate 
objectives. 
xii. Items 3/1 and 4/1 of Part Two of the T echnical Directive required SASO to consider 
relevant international standards as a basis for preparing Saudi technical regulations 
and standards unless these international standa rds or their parts are ineffective or 
inappropriate means for achieving the inte nded, legitimate objectives.  This, for 
example, could be due to their inconsiste ncy with Islamic law or due to climatic, 
geographical factors or basic technical problems. 
xiii. Items 3/2 and 4/4 of Part Two of the Technical Directive declared that, whenever 
possible, technical regulations and standards should be prepared on the basis of product performance requirements rather th an in terms of design or descriptive 
characteristics. WT/ACC/SPEC/SAU/4/Rev.3 
Page 56  
 
 xiv. Item 4/3 of Part Two of the Techni cal Directive required SASO to consider 
equivalent technical regulations of othe r Members unless they were ineffective or 
inappropriate for achieving the intended legitimate objectives. 
xv. Item 2 of Part Three of the Technical Directive required SASO to accept the results of 
conformity assessment procedures conducted by bodies in exporting Member 
countries provided that relevant Saudi Arab ian national deviations  were taken into 
account. 
163. In response to questions from some members of the Working Party, the representative of 
Saudi Arabia stated that importers in Saudi Arabia  had been required to comply with Saudi law which 
required all products, imported as well as domestic, to be  in conformity with Saudi standards.  Unless 
specified otherwise, compliance with Saudi sta ndards was an implied condition of any contract 
between buyer and seller.  Saudi Arabia's standa rds were internationally harmonized to the most 
feasible degree possible, and Saudi-specific st andards were only adopted in cases where the 
international standards would be an ineffective or inappropriate means for the fulfilment of the 
legitimate objectives pursued (Islamic legislation,  national security requirements, fundamental 
climatic, geographical or technological problems), because of Saudi Arabia's fundamental climatic, 
geographical or technological problems, as allowed under TBT  Agreement Article 2.4.  Consequently, 
Saudi Arabia considered that the use of a pre-sh ipment inspection scheme to verify conformity to 
Saudi standards met the criteria of the PSI  Agreement Article 2.4 and footnote 2. 
164. In response to questions concerning the conf ormity of Saudi technical standards with 
international norms, the representative of Saudi Arab ia stated that deviation of Saudi requirements 
from other national standards due to Saudi Arabia 's fundamental climatic, cultural and national 
security specific conditions rendered ISO 9001 alone in adequate to provide sufficient confidence in 
the quality, safety and conformity of goods.  In this  connection, he noted that Saudi Arabia was a 
member of ISO, IEC, OIML and CAC.  All Saudi standards were notified to all other members of 
those international organizations.  A high percentage  of Saudi standards used international standards 
and other widely accepted national standards as refe rences.  He provided members of the Working 
Party with a list of SASO standards that had b een based upon CODEX standards, together with a 
complete list of the 1,323 Saudi standards including a cross-reference to the international standards 
adopted in their entirety as SASO standards (in document WT/ACC/SAU/34).   
165. Some members of the Working Party requested a lis t of the standards deemed to be equivalent 
to Saudi standards.  In response, the representativ e of Saudi Arabia stated that the Saudi Arabian 
Standards Organization had published the list of sta ndards, and in this connection referred to the 
information in document WT/ACC/SAU/15.  He further recalled his earlier statement that Saudi Arabia's standards were internationally harm onized as far as possible.  Certain Saudi standards 
had a corresponding ISO or IEC equivalent which was indicated in the published list of SASO  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 57 
 
 
 standards.  Other Saudi standards used internati onal standards or other recognized national standards 
as a reference.  He noted that a predeterminati on of the equivalency of such standards was not 
feasible, due to the diversity and incorporation of the national requirements a nd deviations of various 
countries.  The registration process under ICCP provided a mechanism for the case by case evaluation and determination of equi valency of the standards to which comp liance was declared by exporters, or 
recognition of the relevant elements in the standa rds that partially satisfy the requirements of the 
Saudi standards.  As additional standards were evaluated progressively, a data base was established 
and referred to in any successive assessment of equivalency. 
166. In response to questions from members of the Working Party, the Saudi representative noted 
that type testing was the ideal additional assuring factor, particularly when it was the most widely used and accepted method to verify the conformity of the design as required under Module H.  
Nevertheless, in lieu of type testing, the ICCP  would accept Module H plus additional documentation 
which demonstrated that the Saudi requirements were typically known, unde rstood and taken into 
account by the manufacturer in all phases within th is system, from contract review through design, 
production, inspection, testing and acceptance. 
167. Some members of the Working Party stated th at the recent exemption of GCC members from 
the ICCP and its implied recognition of equivalenc y of all GCC members' inspection, enforcement, 
and compliance to relevant elements of GCC and/or  SASO standards raised questions under Article 4 
of the SPS  Agreement and the transparency provisions of  the WTO.  Those members asked whether 
GCC member states were obliged to adopt the GCC standards in full or in pArt. In response, the 
representative of Saudi Arabia stated that GCC Members were not exempted from the ICCP.  He 
added that Article 5.4 of the Regulations of th e "Standardization and Metrology Organization for 
GCC Countries" stipulated that mandatory Gulf Sta ndards were adopted by consensus of all members, 
while voluntary or guideline standards were adopted by majority.  Some members of the Working 
Party also requested a list of GCC member countries that had officially adopted and incorporated 
SASO developed standards, by produc t category, (in full or in part) into their national standards.  In 
response, the representative of Saudi Arabia provi ded a list of SASO standards which had been 
adopted as GCC Standards and thereby incorporated  as national standards in other GCC Countries in 
Annex III to WT/ACC/SAU/29. 
168. Some members requested further informati on on the manner in which SASO developed 
technical standards.  In response, the representative of Saudi Arabia stated that standards considered 
vital for achieving legitimate objectives, such as safet y and health, and of concern to a wide spectrum 
of interested parties and economic sectors were re ferred to "technical committees".  However, recent WT/ACC/SPEC/SAU/4/Rev.3 
Page 58  
 
 policy within SASO had been to refer most sta ndards to technical committees irrespectively.  All 
parties concerned with the subject matter of th e draft standard were normally represented on the 
relevant "technical committees" as active members;  they included pertinent governmental, academic, 
industry and trade sectors.  For this reason, only one draft circulation period was necessary to provide 
adequate opportunity for comments by other interested parties.  In case of development of draft standards by the SASO technical staff, the first draft circulation period provided the opportunity for 
comments raised by all concerned parties to be ta ken into consideration in the preparation of the 
second draft.  He also provided the Working Party w ith a copy of the procedures for the development 
of SASO standards in Annex IV to document WT/ACC/SAU/29. 
169. Following further comments on the draft Co mprehensive Guidelines and Procedures 
concerning the ICCP, some members of the Worki ng Party asked whether Saudi Arabia envisaged 
making further changes to the ICCP prior to WTO accession.  In response, the representative of 
Saudi Arabia stated that after careful analysis and consideration of the comments made by WTO Members, further revisions were made, as set  out in documents WT/ACC/SAU/34, 36 and 37 .  
Saudi Arabia did not foresee the need for any exemp tion or transition periods in relation to any WTO 
provisions in connection with the ICCP.  Neverthel ess, Saudi Arabia reserved the right to seek such 
exception at any time during its accession negotiations, should the need arise.   
170. In response to further questions, the representa tive of Saudi Arabia stated that customs 
valuation was not assessed under the ICCP.  He noted also that appeals procedures were included as 
an Appendix to the ICCP Guidelines and followi ng the suggestions of WTO Members had been 
revised to included recourse to independent review  procedures in accordance with Article 4 of the 
PSI Agreement.   
171. In response to comments of various members of the Working Party regarding the ICCP, the 
representative of Saudi Arabia reported that the ICCP will be phased out pursuant to Council of 
Ministers Decision No. 213, dated 3.8.1424H (30.9. 2003), and gradually as we have introduced the 
law on the accreditation of the private laboratories.  Applications have already been received from a 
number of business community wishing to participate in this scheme.  Moreover, the procedure for 
operating private laboratories has already been established and approved in April 2002, by the 
appropriate authority.  The objective of this sch eme is to perform testing on both domestically 
produced as well as imported products.   
172. Some members of the Working Party asked whether testing laboratories and conformity 
assessment bodies could be accredited by the authorities administering the ICCP.  In response, the 
representative of Saudi Arabia stated that Saudi  Arabia recognized conformity assessment bodies in  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 59 
 
 
 other countries via acceptance of accreditation as an i ndication of adequate competence, and hence as 
an eligibility criteria for approval.  In othe r countries that did not have accreditation bodies, 
recognition of conformity assessment bodies was achie ved by extending invitations to all trading 
partner countries to nominate their own labor atories for approval under their governments' 
responsibility.  Any required formalities were kept  to the minimum level necessary to achieve the 
objectives of the Programme.  In fact, the proce dures were fully streamlined as evidenced by the 
virtual non-existence of delays or  complaints by exporters.   
173. He later added that the approval procedure was very simple and straight forward.  
Laboratories seeking SASO approval were require d to complete the "SASO/ICCP Laboratory 
Application Form" (which was supplied to members of the Working Party in document WT/ACC/SAU/34).  He noted that the form provided SASO with information about the accreditation 
that the laboratory already had and the type of I CCP Regulated Products that it had the capabilities to 
test in whole or in pArt. The information was ev aluated and verified and the laboratory was approved 
accordingly.  In countries that did not have Na tionally Recognized Laboratory Accreditation Bodies 
that accredited laboratories in accordance with IS O Guide 25, a higher degree of scrutinizing was 
conducted in order to gain assurance of the laborat ory's competence.  There were no costs involved 
for laboratories seeking SASO approval. 
174. Members of the Working Party asked Saudi Arabia to clarify the process by which a 
Certificate of Conformity could be obtained.  Th e representative from Saudi Arabia clarified that an 
exporter of regulated products to Saudi Arabia c ould obtain a Certificate of Conformity via three 
ways:  (i) Pre-shipment Compliance Verification (for non-registered/non-verified products); (ii) Registration and Pre-shipment Inspection; or (iii) Type-Approval Licensing.  He noted that the last 
option allows manufacturers that have achieved full compliance with the relevant standards to export 
their products with minimum intervention by the program.  Full compliance should be proven through 
type testing of the product(s) at a SASO-approved laboratory, in addition to assessment, approval and 
surveillance of the manufacturer's quality-control syst em to ensure continuous compliance.  Once the 
manufacturer's quality-control system is licensed and approved by SASO, there would be no pre-
shipment inspection requirement for each consignmen t.  Once a manufacturer had been issued a Type-
Approval License, pre-shipment inspection for each consignment was no longer required.  He stated 
that the compliance procedure for Certificates of  Conformity was incorporated in the ICCP 
Comprehensive Procedures and Guidelines Attachment  to Appendix D, Request for Certification. 
175. Some members of the Working Party requested additional information on the possible 
cancellation of certificates of conformity in the even t that products enjoying the benefit of a certificate WT/ACC/SPEC/SAU/4/Rev.3 
Page 60  
 
 of compliance were found to be non-compliant.  The re presentative of Saudi Arabia stated that in such 
a case Saudi Customs would withhold the certificate of compliance number, and suspend the 
certificate of compliance.  Thereafter, Customs would notify SASO and the manufacturer.  An 
expedient investigation was then carried out and a ppropriate action taken on the basis of the findings.  
Depending on the severity, frequency, and cause of th e discrepancy, appropriate action could include 
suspension or withdrawal of the Type Approval Li cense.  The action taken was always proportionate 
to the seriousness of the facts at hand on a case-by- case basis.  Suspension (which may be temporary) 
or withdrawal of the License was only a possib ility in extreme cases, such as fraud or material 
inaccuracy. 
176. Some members of the Working Party asked whether certificates granted by other national or 
international certification bodies were taken into  consideration by the ICCP Regional Licensing 
Centres.  In response, the representative of Saudi Arab ia stated that test reports or certificates issued 
by accredited bodies for the regulated product under a nother national or international conformity 
assessment or certification scheme could be submitted by exporters as documents substantiating their 
compliance.  Full recognition was duly given to those reports/certificates in so far as they satisfy the 
Saudi requirements.  Where the full Saudi requireme nts were met, the role of the ICCP Regional 
Licensing Centre would be limited to evaluation, ve rification, administration, issuance and validation 
of the confirming Statement of Registration or Type Approval License.  The SASO Country Office would still carry out the required PSI associated with  Registration and issue the final Certificates of 
Conformity.  For products holding a SASO Type A pproval License, certificates of conformity could 
be issued by the manufacturers themselves, i.e., pr e-shipment inspection of each consignment is not 
required.  This applied to  all products and countries. 
177. In response to questions from some members of the Working Party, the representative of 
Saudi Arabia stated that SASO was the sole sta ndardization body in Saudi Arabia.  Its Board of 
Directors consists of all concerned Ministries, G overnment Agencies and the Private Sector.  There 
was coordination between SASO and other Saudi aut horities on issuing any regulations that may have 
an effect on international trade of Saudi Arabia  with other countries.  He said that technical 
committees made recommendations to SASO whether a standard should be voluntary or mandatory.  
The criteria for adopting a standard as mandatory would be based on the fulfilment of legitimate 
objectives as provided in the TBT  Agreement, such as protection of health, safety, national security, 
public morals, the environment and prevention of d eceptive practices.  In reply to a question whether 
guidelines and/or criteria would be developed to assi st in determining whether an existing standard 
should remain mandatory when it was reviewed, the representative of Saudi Arabia stated that the 
criteria for adopting mandatory standard would also  apply to a review of the existing standards.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 61 
 
 
 178. Some members of the Working Party requested  Saudi Arabia to confirm that access to the 
SASO Quality Mark would be on a non-discriminatory basis and without distinction to the origin of 
the product.  In response, the representative of Saudi  Arabia stated that access to Saudi Quality Mark, 
a voluntary program, would be on a non-discriminative basis, without distinction as to the origin of the products.  In response to an additional questi on, the representative confirmed that domestic and 
foreign suppliers could apply to obtain the Quality  Mark for imported products.  Use of the Quality 
Mark would be granted in a non-discriminatory fash ion to those domestic and foreign suppliers that 
met the requirements of the program. 
179. A member of the Working Party requested Saudi Arabia to explain its rice labelling 
requirement that information be printed on at least 50 per cent of the surface of the rice package.  In 
response, the representative of Saudi Arabia stated  that this requirement no longer existed, as the 
Kingdom had withdrawn it. 
180. Members of the Working Party asked Saudi Arabia to confirm that the Saudi Conformity 
Assessment Program (SCAP) that Saudi Arabia was developing would comply with WTO rules and that any fees charged for assessing the conformity of th e products originating in the territories of other 
Members were equitable in relation to any f ees chargeable for assessing the conformity of like 
products of national origin or originating in any other country, as foreseen in the TBT  Agreement.  
The representative from Saudi Arabia stated that Sa udi Arabia would ensure the compliance of SCAP 
with all the relevant WTO requirements relating to  national treatment, including fees charged.  The 
representative of Saudi Arabia stated that SCAP would be implemented to ensure compliance of 
domestically produced products with the national st andard.  He stated that the ICCP ensured 
compliance of regulated imported products with rele vant standards.  Thus, the two programs, SCAP 
and ICCP, would continue in paralle l, and would ensure the concept of equivalency of procedures for 
imported and domestically produced products. 
181. In response to a question from members of the Working Party, the representative of 
Saudi Arabia noted that a list of items subject to  mandatory certification had been attached to the 
Working Party Report at Annex I. 
Transparency
 
182. Some members of the Working Party requested that the Government of Saudi Arabia publish 
draft standards in a single official journal or othe r publication that was available to the general public, 
and other interested parties.  In response, the repr esentative of Saudi Arabia stated that this would be 
done.  He noted that SASO would start publishing all dr aft standards in a single official journal issued WT/ACC/SPEC/SAU/4/Rev.3 
Page 62  
 
 during the first half of 2004.  He also confirme d that, until this goal was reached, all Saudi draft 
standards would continue to be announced in all Saudi newspapers and circulated to all foreign 
embassies in Saudi Arabia.  The Working Party took note of these commitments. 
Implementation of TBT  Agreement Obligations
 
183. In response to the above explanations and cl arifications provided by the representative of 
Saudi Arabia, members of the Working Party requested  that Saudi Arabia provide a description of the 
steps being taken to ensure full implementation of the  Agreement on Technical Barriers to Trade.  In 
response, in document WT/ACC/SAU/41, the represen tative of Saudi Arabia provided the Working 
Party with a comprehensive Action Plan for the Implementation of the TBT  Agreement.  The 
representative of Saudi Arabia noted that the Action Plan cross-referenced the various requirements of 
the TBT  Agreement, and described the existing provisi ons or practices in Saudi Arabia and also 
described any planned improvements, including the enactment of implementing legislation.  The 
Action Plan had been fully implemented and necessary legislation to implement the TBT  Agreement 
had been issued under the SASO Comprehensive Di rective of July 2000, copies of which had been 
circulated to Working Party members in October 2000. 
184. The representative of Saudi Arabia stated that Saudi Arabia would comply with all 
obligations under the WTO  Agreement on Technical Barriers to Trade from the date of accession 
without recourse to any transition period.  The Working Party took note of this commitment. 
Preshipment Inspection  
185. Some members of the Working Party stated that the ICCP program mentioned above operated 
as a PSI scheme.  They noted that although most of the requirements of the  Agreement on Pre-
shipment Inspection appeared to have been complie d with, some elements of the ICCP continued to 
raise concerns.  Some members of the Working Party expressed concern that the ad valorem  fee 
charged for conformity assessment was not consistent  with the requirements of Article VIII of the 
GATT 1994.  In response, the representative of Saudi  Arabia stated that Article VIII of GATT 1994 
aimed to ensure that fees did not include incremen tal charges imposed by Governments on top of the 
cost of services rendered.  The ICCP fees were paid  in their entirety by exporters directly to the 
entities contracted by SASO to cover actual inspec tion, registration licensing and certification services 
rendered only.  No part of the fees was paid or a llocated to SASO or any other Government Body, and 
thus no protection to domestic industry was afforded  nor taxation levied.  He added that the fees 
charged were not required to equate exactly with  the exact cost of services rendered; a degree of 
reasonable approximation was allowed.  Global PSI  Programmes were utilized by 33 WTO Members,  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 63 
 
 
 and ad valorem  was the consistently predominant fee scheme prior to the PSI  Agreement.  Since the 
PSI Agreement did not specifically address the issue of  fees, this implied the acceptance, versatility 
and legitimacy of the prevailing ad valorem  method, and affirmed its consistency with the original 
GATT 1994 Article.  Otherwise, the 33 WTO Members would be in direct violation of the WTO  Agreement.   
186. He further added that the application of ad valorem  PSI fees by WTO user Members of PSI 
Programmes had not been raised as the subject of dispute at the WTO to date.  He added that the 
PSI Agreement further acknowledged that Governments normally contracted PSI Programmes to PSI 
Entities as Saudi Arabia had.  Fees required by all reputable PSI Entities (IFIA members) for delivering professional global PSI services were based on the ad valorem  scheme.  Saudi Arabia was 
not operating in a vacuum and could not unilate rally impose on the PSI industry an entirely odd 
scheme contrary to the practice prevailing throughout that industry.  Nevertheless, Saudi Arabia had 
succeeded in introducing reasonable modifications to the fixed ad valorem  method by adopting a cost 
responsive graduated percentage of FOB fee stru cture which was amongst the lowest in the world 
coupled with shipment aggregation, resulting in a much higher degree of approximation of the cost of 
services as well as higher equitability.  Saudi Arabia ha d further made adjustments to situations where 
a disparity existed between the cost of PSI services and the percentage of FOB value of the product, 
e.g., the fees for inspection of cars had a maximum ceiling of US$48.00 per car. 
187. He further added that if a consensus of WTO Members determined that the ad valorem  
scheme was not appropriate, and if an amendment was made to the existing PSI  Agreement 
prescribing an alternative fee scheme, Saudi Arabia would be ready to follow the course of prevailing 
international practice and comply accordingly.  He also noted that any unfavourable consideration of 
its ICCP Regime on grounds of its inspection fee stru cture would be discriminatory in nature, in light 
of the WTO's acceptance of some Members' application of the fixed ad valorem scheme.  There was 
consensus that Saudi Arabia would continue to apply ad valorem  fees under the ICCP, while WTO 
Members reserved their right to settle this issue through the WTO dispute settlement provisions.   
188. In response to comments of various members of the Working Party regarding the role of the 
ICCP and pre-shipment inspection, the representativ e of Saudi Arabia reported that the ICCP was 
being phased out pursuant to Council of Minister s Decision No. 213, dated 3.8.1424 H (30.9.2003).  
The representative of Saudi Arabia confirmed that  its pre-shipment inspection regime would be 
temporary and would only operate until such time as th e Saudi Customs authorities were able to carry 
out the functions presently performed by pre-sh ipment inspection service providers, which would 
occur when the term of the existing contracts expired. WT/ACC/SPEC/SAU/4/Rev.3 
Page 64  
 
 189. In response to a request by members of the Wo rking Party, the representative of Saudi Arabia 
stated that a list of items subject to pre-shipment  inspection had been attached to the Working Party 
Report at Annex J. 
190. The representative of Saudi Arabia stated that from the date of accession to the WTO 
Saudi Arabia would ensure that the requirements of the  Agreement on Pre-shipment Inspection were 
met in full.  He further confirmed that Saudi Ar abia would ensure that the operations of any pre-
shipment inspection companies retained by Saudi Arabia met the requirements of the 
WTO  Agreement, including the establishment of charges and fees consistent with Article VIII of the 
GATT 1994, and would comply with the due process and transparency requirements of the WTO  Agreements, in particular Article X of the GATT 1994, and the  Agreement on the 
Implementation of Article VII of the GATT 1994.  The Working Party took note of these 
commitments. 
Sanitary and phytosanitary measures
 
191. In response to requests for information, the representative of Saudi Arabia supplied detailed 
information on the Saudi Arabian Sanitary a nd Phytosanitary (SPS) regime in document 
WT/ACC/SAU/17.  In addition, he also submitted information on the shelf life of food products in 
document WT/ACC/SAU/27.   
192. The representative of Saudi Arabia stated that  one of the legal bases for SPS requirements in 
Saudi Arabia was the Royal Decree number M/10 on 3/3/1392 H (16 April 1972) developed by the 
competent standardization body (i.e. Saudi Arabian Standards Organization, SASO).  Saudi standards 
covered sanitary requirements for food products by means of the following measures:  
i. Measures following the standards and guidelines of Codex Alimentarius. 
ii. Measures not covered by the standards and guidelines of Codex Alimentarius were 
based upon scientific studies or the most appropriate measures of other WTO 
Members. 
193. In addition, the representative of Saudi Arabia stated that the veterinary quarantine bylaw 
issued vide Council of Ministers Decision Nu mber 109, dated 34/4/1424H  (30.06.2003), covered 
sanitary and veterinary requirements and measur es pertaining to animals and animal products 
conforming to the ruling of the International Zoosanitary Code specifying the regulations 
recommended for international trade with regard to animals and animal products issued by the Office 
International des Epizootics.  He noted also that  the agricultural quarantine bylaw issued by the 
Decree of the Council of Ministers Number 207, dated 26/1/1396 H (28 January 1976), set out 
requirements and phytosanitary measures conforming to  the rules issued from IPPC initially based on  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 65 
 
 
 FAO publications.  Periodic preventive health circular s issued by the Ministry of Health pursuant to 
the weekly epidemiological circular issued by the WHO were also concerned with sanitary and 
phytosanitary measures. 
194. In response to further requests for informati on regarding the role of the GCC and risk 
assessment, the representative of Saudi Arabia stated that, in regard to Saudi Arabia's quarantine 
system and associated risk assessment, the Council of  Ministers had issued Decision No. 109, dated 
30.04.1424H (30 June 2003).  Through Decision No. 109,  Saudi Arabia had adopted the veterinary 
quarantine system applicable to GCC countries.  (H e reported that a revised plant quarantine system 
was still under consideration.)  The representative not ed that the Customs Union of the GCC countries 
had adopted a system of one port of entry for all goods imported to GCC countries.  According to the 
system, any item that was allowed to enter any G CC port was allowed to enter all GCC countries and 
customs procedures such as inspection, laboratory anal ysis and customs fees were handled in the first 
port of entry.  Thus, this system of risk assessment in all GCC countries was unified.   
195. A member of the Working Party asked how Saudi  Arabia would ensure that measures applied 
in each GCC country would meet the requirements of Article 5 of the SPS  Agreement (i.e., that the 
measures applied in each member were not more rest rictive than is necessary to  deal with the risks 
faced by that particular member).  The representa tive of Saudi Arabia explained that, because there 
was free movement of goods between GCC countries due  to the establishment of the customs union, it 
was not feasible to restrict imports in one GCC count ry and to allow imports in other GCC countries.   
196. The representative of Saudi Arabia further re ported that Saudi Arabia earlier had issued 
sanitary and quarantine measures for animal hea lth, living plants and seeds, measures for the 
prevention of epidemic diseases spread and the c ontrol on the use of veterinary medicines and 
pesticides were administered by the Ministry of Agriculture, as well as the Ministry of Commerce and 
Industry and the Ministry of Municipalities.  San itary measures for fresh vegetables and fruits were 
governed by SASO standards and applied by th e Ministry of Agriculture.  When no approved 
international standards applied to these produc ts, the Kingdom of Saudi Arabia approved the 
standards applied in EU member States and Memb ers of the WTO.  Standards concerning sanitary 
measures for food commodities (meat, meat products and processed foods) are approved by SASO but 
applied by the Ministries of Industry and Commerce on locally made products, and by the Ministry of 
Commerce and Industry on imported products.  The Minist ry of Municipalities participated in internal 
control of products in the markets which were mainly controlled by the Ministry of Commerce.  Measures relating to effects on the human health  and its relation with animal sanitary and WT/ACC/SPEC/SAU/4/Rev.3 
Page 66  
 
 phytosanitary and food safety were imposed by the Ministry of Health through the issuing of periodic 
preventative circulars to inform and caution other concerned bodies about relevant risks. 
197. He further noted that sanitary measures of Saudi Arabia were consistent with the 
SPS Agreement and also with the recommendations and guidelines issued by international and 
regional organizations.  Saudi Arabia was a perm anent and active member in the international 
organizations on plant and animal regulations, including FAO, the Codex Alimentarius Commission 
(CAC) and the International Office of Epizootics (IOE).  Saudi Arabia's SPS measures did not 
arbitrarily or unjustifiably discriminate between different countries where identical or similar conditions prevail.  Such measures also did not discr iminate between the territory of Saudi Arabia and 
other countries where identical or similar conditions prevailed.  Saudi Arabia's SPS measures were not applied in a manner which constitutes a di sguised restriction on international trade. 
198. In response to requests for information on the transparency of Saudi Arabia's SPS measures, 
the representative of Saudi Arabia stated that Sa udi Arabia's SPS measures were published in advance 
of their application.  The Kingdom of Saudi Arabia had an established system for informing governments and other standards organizations of changes, and full sets of guidelines detailing all 
requirements were freely available to any inter ested parties.  Saudi Arabia's SPS measures and 
requirements were notified to the Embassies in the Kingdom and to Saudi Chambers of Commerce.   In addition, the representative noted that, as with TB T standards, SASO currently is in the process of 
publishing Saudi food draft standards in a single journa l issued by SASO.  (Until this goal is reached, 
all Saudi SPS measures would continue to be disseminated as described above.)   
199. Members of the Working Party asked Saudi Arab ia to identify any additional steps taken to 
implement obligations in the SPS  Agreement regarding transparen cy and risk assessment.  The 
representative of Saudi Arabia stated that SPS oblig ations had been implemented by recent decisions 
by the Council of Ministers.  In particular, he not ed that Council of Ministers Decision No. 85, dated 
01.04.1421H (4 July 2000), included a number of provisions implementing obligations of the 
SPS Agreement.  First, Decision No. 85 required the Ministry of Commerce and Industry to notify the 
WTO and all WTO Members of all actions relati ng to SPS issues and to respond to any inquiries 
regarding the same.  Second, under the Decision, a Technical Standing Committee was established to 
monitor Saudi SPS measures and ensure that they ar e implemented in accordance with Saudi Arabia's 
WTO obligations.  The Technical Standing Comm ittee comprised representatives from the Ministry 
of Commerce and Industry, the Ministry of Agriculture, the Ministry of Health, SASO and the Customs Department.  Third, Decision No. 85 required the Ministry of Commerce and Industry to prepare a list of all Saudi SPS measures; this list is attached as Annex K.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 67 
 
 
 200. Some members of the Working Party stated that the information on Saudi Arabia's SPS 
measures gave a good overview of the regime.  They sought confirmation that measures were based 
on risk assessments carried out in acco rdance with Article 5 of the SPS  Agreement.  In response, the 
representative of Saudi Arabia confirmed that Saudi Arabia's SPS measures conformed to all 
standards, guidelines or recommendations issued by  the international bodies specifically designated 
by the SPS  Agreement, i.e., the Codex Alimentarius Commission, the International Office of 
Epizootics and the International Plant Protection C onventions.  Saudi Arabia was a member of all 
three organizations.  In accordance with Article 3.2 of the SPS  Agreement, these SPS measures were 
fully consistent with the SPS  Agreement.  For SPS measures related to risk assessment not covered by 
the above three organizations (such as microbiol ogical risks and shelf life of food products), 
Saudi Arabia relied on scientific studies, guidelin es and recommendations either carried out by 
specialized internationally accepted research institu tes, universities or scientific references or, in 
limited cases, by itself.  The appropriate level of pr otection adopted by Saudi Arabia was consistent 
with the guidelines and recommendations issued by these internationally recognized bodies and 
Saudi Arabia had thus taken into account the objec tive of minimizing negative trade effects.  He 
confirmed that Saudi Arabia's SPS measures we re based on risk assessmen t in accordance with 
Article 5 of the SPS  Agreement. 
201. Some members of the Working Party identified certain possible areas of inconsistency with 
the requirements of the SPS  Agreement, such as the Council of Ministers Resolution No. 207 
(26.1.1396H) (28 January 1976) "Agricultural Quarantin e Regulations" requirement in Article 6 that 
products be free of all weed seeds, regardless of wh ether such weed seeds were  quarantine significant, 
in accordance with relevant international guidelines.   Some members also noted that the Council of 
Ministers Decision No. 109 dated 30.04.1424H (30 J une 2003), "The Statutory Instrument of the 
Veterinary Quarantine", Article 3 stated that "no animal may be admitted ... from any country that was 
infected with any epidemic disease ...".  These member s were of the view that this requirement was 
inconsistent with Article 6 of the SPS  Agreement.  In response the representative of Saudi Arabia 
stated that upon accession, the Kingdom of Saudi Arabia would comply with the relevant WTO obligations.  In response for further information concerning the importation of seeds, he noted that 
there was no fee charged for the inspection of seed s.  The seeds were first subject to a visual 
examination to check for impurities and to ensure that the phytosanitary information in the import 
documents was correct.  Thereafter samples of th e seeds were sent to laboratories to check for 
aflatoxins. 
202. One member of the Working Party asked for a clarification of Saudi Arabia's treatment of 
meat in sealed containers, where the meat had fi rst entered another GCC country.  The representative WT/ACC/SPEC/SAU/4/Rev.3 
Page 68  
 
 from Saudi Arabia noted that Saudi Arabia understood the importance of this issue and that the issue 
had been taken up by the Ministry of Commerce and Industry.  The Ministry was studying the issue 
and was expected soon to take a decision.   
203. Some members of the Working Party stated that certain laws, such as the "Approval of 
Importing Alfalfa and Vegetable Seeds from N on-Arab Countries", and "Approval of Importing 
Flower and Forage Crop Seeds from Non-Arab C ountries" appeared to only apply to "non-Arab" 
countries, which suggested problems in relation to  the consistency of these regulations with the 
principle of most-favoured-nation treatment.  In r esponse to further questions, the representative of 
Saudi Arabia stated that upon accession, the Kingdom of Saudi Arabia would comply with the relevant WTO obligations.  Some members of the Working Party stated that position appeared inconsistent with the SPS  Agreement's requirement that, in applying SPS measures, WTO Members 
recognize "regional conditions" affecting human, animal and plant health risks.  In response, to these 
and further concerns expressed by Working Party me mbers about particular regulations and practices 
in the Saudi Arabian SPS regime, the representative of  Saudi Arabia stated that those regulations 
would be reviewed.   
204. Some members of the Working Party noted that the time limits relating to shelf life in 
Saudi Arabia appeared to be unduly short.  In res ponse, the representative of Saudi Arabia stated that 
Saudi Arabia was revising its shelf-life requirements to  ensure they comply with the provisions of the 
SPS and TBT  Agreements. 
205. He further stated that Saudi Arabia's shelf-lif e standards originally had been adopted in the 
light of Saudi Arabia' extreme climate and other c onditions specific to Saudi Arabia.  Saudi Arabia' 
shelf-life determinations were based on scientific  investigations and on international and other 
countries' national standards, scientific studies and reports conducted/issued by specialized 
internationally reputable research institutes and unive rsities, and international scientific references.  
The final determination of shelf life was based on studies for which "the stated storage conditions" 
most closely resembled Saudi Arabian conditions.  These conditions had been thoroughly investigated and surveyed by Saudi Arabia in the report entitled "Proceedings of Symposium on the Transportation, Handling and Storing of Food Products in the Kingdom, Part I and II dated 
26-28 February 1989".  In this connection, he noted  that Codex defined "Use-by-Date" as "the date 
which signifies the end of the estimated period under any stated storage condition after which the product probably would not have th e quality attributes normally expected by the consumers.  After 
this date, the food should not be regarded as ma rketable".  He further added that the term 
"unacceptable to the consumer" and "unfit for human  consumption" respectively corresponded to, and  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 69 
 
 
 were self evident from the above definition.  He further added that Saudi Arabia relied for the 
determination of the shelf life of food products on available scientific studies by specialized, 
internationally recognized bodies and on referen ces, based on research conducted for academic or 
industrial/commercial purposes.  The fact that part  of this research was conducted by manufacturers 
demonstrated that Saudi Arabia took into consid eration differences in manufacturing and packaging 
processes.  This wide spectrum of scientific basis did not  affect Saudi Arabia's right to engage in shelf 
life determination as an SPS measure for perishable  food products and as a TBT technical regulation 
appropriate to Saudi Arabia's climatic c onditions for shelf stable food products.   
206. In response to further questions he noted that manufacturer determined shelf life practices that 
were followed in other countries were neither uni form nor could be considered as official SPS 
measures by governments.  Nevertheless, shelf lif e periods of perishable food products were not 
imposed unilaterally, but rather adopted in acco rdance with the same open process applicable to 
standards, i.e., through technical committees entruste d with the preparation of the standard whose 
diversified membership included representatives of  the industrial and commercial sectors.  He 
considered that those members had the opport unity to influence the decision on shelf life 
determination and insure its responsiveness to the needs of the industry, not to mention the period 
afforded for consultation and comment by any inter ested parties.  In addition, SASO administrative 
procedures and directives provided the opportunities for manufacturers to submit at any time the scientific basis for their own determined shelf to SASO for evaluation.  If those manufacturers could 
demonstrate objectively that their shelf life periods were appropriate to Saudi Arabia's level of SPS 
protection as well as the food quality criteria, Saudi Arabia would revise its shelf life standards accordingly. 
207. In response to further questions, the representativ e of Saudi Arabia noted that the same shelf-
life periods were applied to domes tic and imported food products alike.  In the case of shelf-stable 
products, the TBT  Agreement granted Saudi Arabia the right to take into account the effect of the 
country's specific climatic and infrastructural c onditions (i.e., transportation, storage and handling 
conditions).  However, climatic c onditions were the major factor cons idered by SASO in determining 
shelf life.  In rare cases covering particular produc ts where non-concurrence or differences were found 
between the internationally recognized studies and re ferences, the tendency had been to rely more 
heavily on the shorter shelf life periods determined  by these studies as an indirect compensation for 
not specifically accounting for infrastructural factors.   With the improvement of the infrastructural 
factors, a less-stringent system would be adopted. WT/ACC/SPEC/SAU/4/Rev.3 
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 208. In response to additional inquiries by members of the Working Party, the representative of 
Saudi Arabia confirmed that Saudi Arabia was in th e process of revisiting the shelf-life requirements.  
There is a technical committee from different Government Ministries (Ministry of Commerce and 
Industry, Ministry of Health, Ministry of Agriculture, Ministry of Municipality, Universities and SASO) to revise the Saudi mandatory standards of  the shelf-life of food products according to SPS, 
TBT, Codex Alimentarius Commission, Internati onal Scientific References, Research and Field 
Scientific Studies carried out in the Kingdom of Sa udi Arabia or abroad.  We will send the revised 
draft to the concerned bodies for comments for a period of two months, any comments will be studied by the technical committee to prepare the final draf t, which will be approved by the SASO Board of 
Directors.  The Technical Committee will study also the deletion of the statement of not allowing any food product which overpasses more than half of its sh elf-life from the Saudi standard "Shelf-life for 
food products".  We hope to conc lude all mentioned steps in the first half of year 2004. 
209. Some members of the Working Party noted that the SPS  Agreement required that WTO 
Members accept the SPS measures of other members, subject to confirming objectively that those measures were adequate to achieve the importing count ry's level of SPS protection.  In response, the 
representative of Saudi Arabia stated that upon accession, Saudi Arabia would accept the certification 
of exporting countries in accordance with the requirements of the SPS  Agreement.   
210. Some members of the Working Party requested  that Saudi Arabia identify all areas of 
inconsistency and provide a timetable for bringing th e Saudi Arabian regime into conformity with the 
requirements of the SPS  Agreement.  In response, the representa tive of Saudi Arabia stated that an 
internal review had already been commenced into  Saudi Arabia's SPS regime guided by the comments 
of the WTO Working Party in this respect.  At a later stage, the representative of Saudi Arabia 
provided members of the Working Party with a comprehensive Action Plan for the Implementation of the SPS  Agreement in document WT/ACC/SAU/42.  Later,  he informed the Working Party that the 
Action Plan had been fully implemented by issuance of the Council of Ministers' Decision No. 85 
of July 2000 and the Council of Ministers' Decision No. 943 of 1 July 2003 on SPS law titled "Sanitary and Phytosanitary Unified Procedures" wh ich was in compliance with the provisions of the 
WTO SPS  Agreement.  In reply to questions from so me Working Party members, the representative 
of Saudi Arabia stated that the new SPS law al so incorporates revisions of the "Agricultural 
Quarantine Regulations" and the "Statutory Inst ruments of Veterinary Quarantine" ensuring 
conformity with the requirements of the SPS  Agreement.  He reported that the salient features of the 
new Saudi Law include the following: 
i) Saudi Arabia shall apply SPS measures c onsistently with the provisions of the 
WTO Agreement on SPS Measures (Article 2.1 of Saudi Law).  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 71 
 
 
 ii) SPS measures shall be limited to the exte nt necessary to protect human, animal or 
plant life or health.  (Article 2.2 of Saudi Law). 
iii) SPS measures shall be based on scientific rules and principles and shall not be 
maintained without sufficient scientific evidence (Art. 2.2). 
iv) There will be no unjustified discrimin ation between WTO Members and between 
Saudi Arabia where identical or similar conditions prevail (Art. 2.3).   
v) SPS measures shall not be applied in a way that constitutes a disguised restriction on 
international trade (Art. 2.).   
vi) SPS measures taken by Saudi Arabia sha ll be based on international standards, 
guidelines or recommendations, except where th ere is a scientific justification for a 
measure resulting in a higher level of protection (Art. 3.1 of Saudi Law). 
vii) Saudi Arabia shall accept the SPS measures of other WTO Members as equivalent 
where those measures achieve the protection level of Saudi Arabia (Art. 4.1). 
viii) Article 5 of Saudi Arabia's SPS Law follo ws the provisions of Article 5 of the WTO 
SPS Agreement. 
ix) Article 6 of Saudi Arabia's law follo ws the provisions of Article 6 of the 
SPS Agreement. 
x) Articles 7 and 8 of Saudi Law follow the provisions of Articles 7 and 8 of the 
SPS Agreement. 
211. The representative of Saudi Arabia stated th at Saudi Arabia's sanitary and phytosanitary 
standards system would be in compliance with WTO provisions under the  Agreement on the 
Application of Sanitary and Phytosanitary Measur es as of the date of accession to the WTO, and that 
Saudi Arabia would apply all measures of the  Agreement on the Application of Sanitary and 
Phytosanitary Measures in the least trade-di storting manner from the date of accession without 
recourse to any transition period.  The Working Party took note of these commitments. 
Trade Related Investment Measures  
212. Some members of the Working Party congratulated  Saudi Arabia on its generally very liberal 
investment regime and asked whether there were any measures in place in Saudi Arabia that were 
inconsistent with the requirements of the  Agreement on Trade Related Investment Measures (TRIMs).  
In response, the representative of Saudi Arabia stated that there were no measures in place in 
Saudi Arabia that were inconsiste nt with the requirements of the  Agreement on Trade Related 
Investment Measures (TRIMs).  He noted that in  particular, there were no measures in place in 
Saudi Arabia that were of the kind described in the "Illustrative List" in the Annex to the  Agreement 
on TRIMs.  Some members of the Working Party enquired whether Saudi Arabia imposed any transfer requirements in relation to technical or management know-how or upon foreign investors.  In 
response, the representative of Saudi Arabia stated  that no precise requirements on such transfers had 
been specified. 
213. The representative of Saudi Arabia stated that Saudi Arabia would not maintain any measures 
inconsistent with the TRIMs  Agreement and would apply the TRIMs  Agreement from the date of WT/ACC/SPEC/SAU/4/Rev.3 
Page 72  
 
 accession without recourse to any transition period.  The Working Party took note of this 
commitment. 
State Trading
 
214. Some members of the Working Party asked the representative of Saudi Arabia whether there 
were any enterprises operating within the Kingdom of  Saudi Arabia that enjoyed any exclusive or 
special privileges within the terms of the defi nition set down in Article XVII of GATT 1994.  In 
response, the representative of Saudi Arabia stated that the Grain Silos and Flour Mills Organization 
(GSFMO) was established by a Royal Decree in 1973 in order to support the development of the domestic agricultural sector, particularly wheat pr oduction for national security reasons, by forming a 
grain storage and flour production conglomerate, as well as by creating a stable market for grains in order to safeguard farmers from price fluctuations .  It was the only organization allowed to import 
grains, flour and animal feed.  GSFMO used to be the only organization to import wheat and barley.  
The import regime for these products had now been lib eralized.  Importers in the private sector could 
import wheat and barley.  GSFMO no longer imports these products.  It was no longer a state-trading import enterprise.  In response to a question, the re presentative of Saudi Arabia stated that 18 private 
firms were importing wheat and barley following the termination of GSFMO monopoly.  
Saudi Arabia confirmed that GSFMO was no longer a state-trading import enterprise. 
215. The representative of Saudi Arabia confirmed that after accession to the WTO, Saudi Arabia 
would observe WTO provisions, in particul ar, Article XVII of the GATT 1994, the WTO 
Understanding on that Article, and Ar ticle VIII of the GATS regarding state trading, with respect to 
the State-owned enterprises and other enterprises a nd entities with special or exclusive privileges 
identified above, in particular abiding by the provi sions for notification, non-discrimination, and the 
application of commercial considerations for tr ade transactions.  The Working Party took note of 
these commitments. 
Free Zones
 
216. The representative of Saudi Arabia stated that Saudi Arabia had no free zones or free 
economic zones.  He further stated that, if any we re established, Saudi Arabia would administer them 
in compliance with WTO provisions, including tho se addressing subsidies, TRIMs and TRIPS, and 
that goods produced in these zones under tax and tari ff provisions that exempt imports and imported 
inputs from tariff and certain taxes and charges woul d be subject to normal customs formalities when 
entering the rest of Saudi Arabia, including the appli cation of tariffs and any taxes and charges.  The 
Working Party took note of these commitments.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 73 
 
 
 Trade in Transit 
217. The representative of Saudi Arabia informed th e Working Party that goods in transit through 
Saudi Arabia received duty free treatment under Articles 69-73 of the Common Customs Law of the 
GCC member states which was applicable in Saudi  Arabia.  The Kingdom's policy regarding goods in 
transit was to allow them to be transported thr ough Saudi Arabia without any discrimination as to the 
kind of goods or their origin or destination.  He said that goods transiting Saudi Arabia bound for 
other countries were subject to the following conditions: 
i. Banned goods were prohibited to tran sit Saudi Arabia, according to the GCC 
Common Customs Law. 
ii. The types and marks of the goods should be specified in the accompanying manifest.   
iii. The goods should be transported in m odular containers having only one access and 
duly equipped with a lock to allow e ffective placement of Customs seals; the 
Customs seal should not be broken. 
iv. Transit of the consignment across Saudi Ar abia must be covered by the guarantee of a 
customs broker at the port of entry. 
v. The consignment must exit within the period specified by the port of entry. 
218. In response to a question from a member of  the Working Party, the representative from 
Saudi Arabia confirmed that Saudi Arabia's law and practice governing trade in transit would be 
applied in full conformity with the provisions of the WTO  Agreement, in particular Article V of 
GATT 1994.  The Working Party took note of this commitment.   
Agricultural Policy  
219. The representative of Saudi Arabia provided in formation on its agriculture sector, including 
tables on domestic support and e xport subsidies in documents WT/ACC/SAU/19 and 28, and 
WT/ACC/SPEC/SAU/1/Rev.6 and Corr.1. 
220. Some members of the Working Party requested that Saudi Arabia provide detailed 
information on the role of the Saudi Agricultural Bank,  in particular in the area of its mandate with 
regard to providing agricultural loans and subsidies.   In response, the representative of Saudi Arabia 
stated that the Saudi Arabian Agricultural Ba nk (SAAB) was founded by the Royal Decree No. 58 
issued on 3/12/1382.  It was a government financia l institution specializing in providing funding to 
the agricultural sector in order to assist in the de velopment of agriculture, and improve agricultural 
productivity through the deployment of state of th e art scientific and technical methods.  The Bank 
granted loans through 13 branches, with 57 offices throughout the Kingdom in order to facilitate 
provision of services to farmers in their regions.  The Bank grants farmers, agricultural projects, 
fishermen, bee keepers and farm cooperatives two types of agricultural loans free of interest.  WT/ACC/SPEC/SAU/4/Rev.3 
Page 74  
 
 However, there were unseen costs borne by agricu ltural investors in order to acquire a loan from 
SAAB.  These costs were reflected in the number and amount of loans shown in the table below.  The 
time needed to process the application and approve th e loan was long due to bureaucratic formalities.  
Therefore, the opportunity costs for agricultural loans were very low. 
Year No. Total 
Amounts (thousands SARs) 
1992 4374 775,150 
1993 4429 930,561 
1994 3822 670,556 
1995 2642 412,589 
1996 3065 431,708 
1997 3942 626,956 
1998 5607 897,310 
1999 6628 903,010 
2000 6147 1,112,221 
2001 8037 1,444,925 
Source:  Saudi Arabian Agricultural Bank, Annual Report No. 38, 1421/1422 (2001). 
221. He added that the Bank had also been respons ible for the disbursement of a package of 
agricultural subsidies incurred by the government towards reduction of agricultural expenditures in 
order to increase the average retu rn on agricultural production.  These subsidies included: engines, 
irrigation pumps, agricultural machinery, poultry e quipments, dairy production equipment, in addition 
transport costs from the country of origin of high breed cows imported to the Kingdom were also 
paid.  The following table shows total agricultura l subsidies disbursed through the bank during the 
period 1992-2001: 
Year Total subsidies (Thousands SAR1s) 
(US$1 = SARs 3.75) 
1992 677,902 
1993 248,624 
1994 355,434 
1995 0 (no subsidies) 
1996 296,937 
1997 229,376 
1998 225,492 
1999 197,358 
2000 228,960 
2001 249,880 
Source:  Saudi Arabian Agricultural Bank, The Annual Report, No: 38, 1421/1422 (2001. 
222. In response to further questions, the representative of Saudi Arabia stated that in pursuance of 
the current Development Plan, Saudi Arabia woul d distribute land in areas where suitable quantities 
of water resources were available.  Investment woul d be encouraged in large agricultural projects that 
depend on renewable water resources,  using modern irrigation systems that consume low quantities of  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 75 
 
 
 water.  Domestic production of vegetables and fru its grown in green-houses would be encouraged, as 
would the fishing industry using advanced technol ogy.  As planned, wheat production was gradually 
reduced from more than 4 million tons before 1994 to 2.8 million tons in 1994, 2 million tons in 1998 
and 1.8 million tons in 2001.  The production of ba rley was also reduced from 2 million tons in 
1994-1995 to 1 million tons in 1998, and to less than  200,000 tons in 2001.  Domestically produced 
barley was purchased by the GSFMO, and then so ld to livestock producers at the fixed price of 
US$ 133 per ton.  The representative of Saudi Arabia stated that GSFMO stopped receiving domestic 
barley according to Royal Decree No. 4/B/49434, da ted 8.12.1423H (10 February 2003).  The farmers 
were advised to convert to other products that consume less water. 
223. Some members of the Working Party asked whet her there was any support to the dairy sector.  
In response, the representative of Saudi Arabia stat ed that there was no specific support for the dairy 
sector, except for transportation cost of the imported cows under special conditions. 
224. In response to questions concerning the provisi on of irrigation water for crop production, the 
representative of Saudi Arabia stated that irriga tion water for crop production was provided by private 
farmers, and not by the Government.  He noted that there were no subsidies associated with the 
running of irrigation equipment. 
225. Some members of the Working Party requested th at the representative of Saudi Arabia clarify 
the role of the GSFMO in the export and subsidiza tion of wheat.  In response, the representative of 
Saudi Arabia stated that since 1995 the GSFMO had not exported wheat or barley.  Export controls 
were maintained for subsidized wheat and barley  through export licenses.  In response to further 
questions, he added that the expor tation of date palm seedlings, barley, corn maize and soy beans was 
conditional upon the repayment of subsidies in tended for the support of domestic production. 
226. Saudi Arabia's commitments on [agricultural ta riffs on] domestic support and export subsidies 
for agricultural products are contained in the Schedule of Concessions and Commitments on Goods 
(document WT/ACC/   ) annexed to Saudi  Arabia's draft Protocol of Accession. 
Trade in Civil Aircraft  
227. Some members of the Working Party asked th at Saudi Arabia enter a commitment to accede 
to the  Agreement on Civil Aircraft from the date of entr y into force of its Protocol of Accession.  In 
response, the representative of Saudi Arabia stated  that Saudi Arabia had no present intention to 
accede to the  Agreement on Civil Aircraft. WT/ACC/SPEC/SAU/4/Rev.3 
Page 76  
 
 Trade Related Intellectual Property Regime
 
General  
Industrial Property Protection  
228. The representative of Saudi Arabia confirme d that the policy objective in the area of 
intellectual property was to provide effective and ad equate protection to all categories of intellectual 
property in conformity with the provisions of the  Agreement on Trade-Related Aspects of Intellectual 
Property Rights.  In addition to the Memorandum on the Foreign Trade Regime, the representative of 
Saudi Arabia provided the Working Party with  a Supplementary Memorandum on Trade Related 
Intellectual Property Rights (WT/ACC/SAU/5).  The representative of Saudi Arabia provided the Working Party with the texts of the Trademarks  Regulations, Patents Law and the Law for the 
Protection of Copyrights (L/7645/Add.1). 
229. Some members of the Working Party congratulat ed Saudi Arabia on its generally high level 
of protection of intellectual property rights.  They noted that Saudi Arabia had taken significant steps 
towards making its trade regime fully consistent with the  Agreement on Trade Related Aspects of 
Intellectual Property Rights (TRIPS), but that some  problems remained.  Some members asked that 
Saudi Arabia take immediate steps to address probl ems in its intellectual property regime, and asked 
also that Saudi Arabia commit itself to full implementation of the TRIPS  Agreement without a 
transitional period.  In particular, some members of the Working Party expressed concerns in relation 
to the protection of copyrights; the duration of pate nt protection; protection of plant varieties; length 
of time before compulsory licensing and working requirements were applied; protection for sound 
recordings and audiovisual works; protection fo r broadcasts and satellite transmission; explicit 
protection for computer software programs; implem entation of Articles 1-21 of the Berne Convention; 
and the protection of well-known marks.  In respon se, the Representative of Saudi Arabia reaffirmed 
Saudi Arabia's commitment to meeting the obligations of the TRIPS  Agreement and provided 
additional relevant information as set forth below. 
Agencies Responsible for Policy Formulation and Implementation
 
230. In response to questions from members of the Working Party, the representative of 
Saudi Arabia confirmed that different Saudi ag encies were responsible for different aspects of 
intellectual property formulation and implementati on, depending on the precise nature of the issue 
involved.  For example, the Ministry of Commer ce and Industry was responsible for implementing the 
Trade Marks Law and for formulating and impl ementing policy regarding the protection of  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 77 
 
 
 undisclosed information, pursuant to the Compani es Law, the Labour Law, the Banking Control Law 
and the new Unfair Competition Law, currently under consideration, that would deal comprehensively 
with this issue.  He further stated that the King Abdulaziz City for Science and Technology (KACST) 
was responsible for implementing policy regarding Pa tents, the Protection of Industrial Designs, Plant 
Varieties and Layout of Integrated Circuits.  He added that the Ministry of Culture and Information 
was responsible for implementing the Copyright Law. 
Membership in International Intellectual Property Conventions  
231. In response to questions from the members of  the Working Party, The representative of 
Saudi Arabia confirmed that Saudi Arabia was a member of a number of intellectual property 
conventions, including: 
i. The Convention Establishing the WIPO. 
ii. The Berne Convention. iii. The Paris Convention. iv. The Universal Copyright Convention. v. The Arab Regional Copyright and Related Rights Agreement. 
Application of MFN and National Treatment to Foreign Nationals Error! Bookmark not defined.
 
232. In response to a question from the members of  the Working Party, the representative of 
Saudi Arabia stated that the Kingdom provided MF N and National Treatment in accordance with the 
provisions of Articles 3 and 4 of the TRIPS  Agreement. 
Fees and Taxes  
233. In response to a question from members of the Working Party, the representative of 
Saudi Arabia gave the following information on fees and charges: 
Copyrights:  No fees or charges 
Trade Marks, Including Service Marks  
-  Application Fee:     SAR 1,000 
-  Registration Fee:     SAR 3,000 
-  Renewal of Registration:    SAR 3,000 
-  Changes or Modifications to Registration:  SAR 1,000 
-  Late Fee for Delayed Renewal:    SAR 3,000 WT/ACC/SPEC/SAU/4/Rev.3 
Page 78  
 
 Substantive Standards of Protection, Incl uding Procedures for the Acquisition and 
Maintenance of Intellectual Property Rights  
Copyright  
234. With reference to copyright, some member s of the Working Party considered that 
Saudi Arabia's laws did not fully reflect its obliga tions under the Universal Copyright Convention.  In 
addition, the provisions of the Saudi laws di d not provide protection for sound recordings.  
Saudi Arabia had not yet joined the Berne, Pari s, or Geneva Phonograms Conventions.  Membership 
in such multilateral intellectual property  Agreements demonstrated a strong commitment to protection 
and supports local enforcement.  Other apparent defi ciencies included the fact that there were no laws 
that protect broadcasts and satellite transmissions, and that the term of protection for audiovisual works was 25 years, not 50 years as called for in the TRIPS  Agreement.  Saudi Arabia's laws also 
appeared to lack sufficient legal penalties to deter pi racy, e.g., substantial fines or prison sentences.  In 
response, the representative of Saudi Arabia stated that Saudi Arabia's intellectual property regime 
would be brought into full conformity with the requirements of the  Agreement on TRIPS, from the 
date of Saudi Arabia's accession to the WTO.  In document WT/ACC/SAU/39, the representative of 
Saudi Arabia provided members of the Working Party with a detailed plan on the steps being taken to 
ensure full implementation of the TRIPS  Agreement according to the Ac tion Plan.  The representative 
stated that Saudi Arabia had joined the Bern and Paris Conventions. 
235. In response to questions from members of the Working Party, the representative of 
Saudi Arabia stated that ongoing reviews of the WT O conformity of Saudi law had so far revealed 
that there were some areas of incompatibility th at would need to be rectified either through 
amendment of existing legislation or enactment of new laws.  It would also be necessary to introduce 
the administrative machinery to ensu re the enforcement of TRIPS sta ndards.  Later, the representative 
of Saudi Arabia informed Working Party members that Saudi Arabia had enacted a new Copyright 
Law, which was in full conformity with the provisions of the TRIPS  Agreement.  The new Copyright 
Law was issued vide Council of Ministers' Decision of 9 June 2003.  The main features of the new Law were: (1) more explicit protection for comput er software and data bases; (2) more specific 
protection to audio-visual works and sound recordi ngs, including protection for 50 years; (3) legal use 
of foreign works such as translations and copying would be clarified according to the 
TRIPS  Agreement; (4) duration of protection of all artistic and literary works would be provided 
according to the requirements of the Berne Conventi on.  In the area of enforcement, the new Law 
provided in detail for all types of infringements and piracies and strengthened penalties (including 
provisions for imprisonment) to meet the requirements of the TRIPS  Agreement.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 79 
 
 
 Patents  
236. Concerning patents, the representative of Saudi Arabia noted that in general, patentable 
subject matter in Saudi Arabia was consistent  with the requirements of Section 5 of the 
TRIPS  Agreement.  Processes (methods of manufacturing) were patentable, and were protected from 
infringing use.  Plant varieties were not currently patentable, even though the TRIPS  Agreement 
required the protection of plant varieties (Article 27(3)).  The representative of Saudi Arabia stated 
that the protection of plant varieties would be provided in accordance with the provisions of 
Article 27(3)(b) of the TRIPS  Agreement.  Patent holders in Saudi Arabia would be accorded the 
rights mentioned in Article 28 of TRIPS.  A patent  holder was required to make full industrial use of 
the patent in Saudi Arabia within two years.  Although the current Patent Law conferred a term of 
protection of 15 years with the possibility of a five year extension, the representative of Saudi Arabia 
stated that it was foreseen that the period of protection for nationals of WTO Members, could be 
automatically granted a five year extension after the elapse of the initial 15-year protection period.  The representative of Saudi Arabia confirmed that amendments of the Patent Law would include a 
term of protection of 20 years. 
237. As to compulsory licensing, the representative of  Saudi Arabia stated that the amendment of 
the Patent Law would conform national law and pr actice to the requirements of Article 31 of the 
TRIPS  Agreement.  The review of the Patent Law had revealed that, in comparison with Article 27(3) 
of the TRIPS  Agreement, the exclusion of patentability contained in paragraphs (a) and (b) of 
Article (8) was in accordance with Article 27 (1) of the TRIPS  Agreement which limits the patentable 
inventions to those which were related to products  or processes; paragraph (c) of Article (8) was in 
full compliance with subparagraph (b ) of Article 27(3) of the TRIPS  Agreement except that paragraph 
(c) did not exclude "micro-organisms" from "plants and animals" and did not include "non-biological 
processes" as processes excluded from "biological processes for the production of plants and 
animals"; and that paragraph (d) of the Patent La w was in full compliance with sub-paragraph (a) of 
Article 27(3) of the TRIPS  Agreement.  The representative of Sa udi Arabia informed Working Party 
members that the draft Law was at an advanced stage in the legislative process.  He said that the draft 
Law was in full conformity with the provisions of the TRIPS  Agreement and included provisions not 
only on Patents, but also on Industrial Designs, Plan t Varieties and Layout Designs of Integrated 
Circuits. 
Individuals Companies  
SAR SAR 
Application Fee 400 800 
Patent Grant and Publication 500 1,000 
Annual Fees 400 800 WT/ACC/SPEC/SAU/4/Rev.3 
Page 80  
 
 Individuals Companies  
SAR SAR 
Amendments/Additions to 
Patent Applications  
100  
200 
Change of Ownership 200 400 
Certified Copies from Register 50 100 
Grant of Compulsory Licence 4,000 8,000 
Registering Licence Agreement 400 800 
 
Trademarks  
238. In response to requests for information c oncerning the protection of trademarks in 
Saudi Arabia, the representative of Saudi Arabia gave a description of various provisions of the 
existing Trade Marks Law and their relationship to the respective provisions of the TRIPS  Agreement.  
In response to questions from Working Party member s, he stated that geographical names could not 
be registered as a trademark under Saudi Arabia's  Trademarks Regulations if their use caused a 
misunderstanding as to the source of products or services, or their origin.  Since the production, sale, consumption and import of alcoholic  beverages were prohibited in the Kingdom for religious reasons, 
geographical indications of origin of wines and sp irits were not protected in Saudi Arabia.  Some 
members of the Working Party noted that the period of protection for a trademark when the requirement of use was not fulfilled was five year s, two years more than the period required by 
Article 19 of the  Agreement on TRIPS.  These members noted also that the initial and renewable 
period of period of protection for trademarks where the requirement of use was fulfilled was ten years, 
three years more than the period required by Article 18 of the  Agreement on TRIPS.  Later, the 
representative of Saudi Arabia stated that a new WTO-consistent Trade Marks Law was issued vide 
Council of Ministers' Decision No. 140 of 5 August 2002,  to bring Saudi Arabia's trademarks regime 
into compliance with the provisions of the TRIPS  Agreement.   
Geographical Indications, Including Appellations of Origin
 
239. Members of the Working Party asked for details regarding Saudi Arabia treatment of 
geographical indications.  In response, the represen tative of Saudi Arabia stated that the new WTO-
consistent Trade Marks Law, which also containe d provisions regarding geographic indications, was 
issued vide Council of Ministers' Decision No. 140 of 5 August 2002.  The new Trade Marks Law, he 
said, was consistent with WTO TRIPS  Agreement and contained provisions on protection of 
geographical indications.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 81 
 
 
 Industrial Designs  
240. In response to requests for information con cerning the protection available for industrial 
designs, the representative of Saudi Arabia responded that industrial designs would be protected by 
the industrial designs provisions in the draft Law on Patents, Industrial Designs, Plant Varieties and 
Layout Designs of Integrated Circuits, to be implemented by The King Abdulaziz City for Science 
and Technology (KACST).   
Layout Designs of Integrated Circuits  
241. In response to requests for information concerni ng the protection available for layout designs, 
the representative of Saudi Arabia noted that protecti on of layout designs of integrated circuits was 
covered by the draft Law on Patents, Industrial Designs, Plant Varieties and Layout Designs of 
Integrated Circuits, consis tent with WTO obligations. 
Plant Variety Protection  
242. In response to questions from members of the Working Party, the representative of 
Saudi Arabia stated that protection of plant va rieties was provided by the draft Law on Patents, 
Industrial Designs, Plant Varieties and La yout Designs of Integrated Circuits. 
Undisclosed Information  
243. Some members of the Working Party requested  information on the protection available for 
undisclosed information.  The representative of Saudi Arabia stated that although undisclosed 
information was currently protected by the Comp anies Law, Labour Law and Banks Control Law, 
work was underway to prepare an Unfair Competition Law that would deal comprehensively with this 
issue.  That law would be implemented by the Ministry of Commerce and Industry.  He added that anti-competitive practices would be covered by the law as well. 
Enforcement 
 
244. Some members of the Working Party noted the steps being taken by Saudi Arabia to eliminate 
some problems in the area of enforcement, in partic ular the piracy of intellectual property.  It was 
clear that much of the necessary legislation was in place, but that was experiencing difficulty in fully 
implementing and enforcing the new laws.  These members of the Working Party urged Saudi Arabia to work towards full conformity with the  Agreement on TRIPS from the date of Saudi Arabia's 
accession to the WTO.  In response to comments con cerning the enforcement of border measures, the WT/ACC/SPEC/SAU/4/Rev.3 
Page 82  
 
 representative of Saudi Arabia stated that border m easures in Saudi Arabia were broadly consistent 
with the provisions of the TRIPS  Agreement which authorized judicial or administrative bodies to 
issue a provisional seizure decision pursuant to Artic le 22.7 of the Copyright Law and Article 49 of 
the Trade Marks Law.  Moreover, Customs authorities, in coordination with the Ministry of Commerce and Industry and the Ministry of Culture  and Information, seized consignments infringing 
intellectual property rights, according to the applicable  laws in Saudi Arabia.  In connection with the 
enforcement of border measures, Saudi Customs was in the process of establishing an IPR Unit, 
which would serve as a database on forged and counterfeit goods. 
245. The representative of Saudi Arabia stated that it was the intention of Saudi Arabia to fully 
comply with the requirements of the  Agreement on TRIPS as soon as possible.  Much of the required 
legislation was already in place.  In addition, Sh ariah provided significant protection of intellectual 
property rights.  Saudi Arabia was working to wards codification of all laws required by 
the Agreements on TRIPS. 
246. In response to requests from members of the Working Party, the representative of 
Saudi Arabia stated that the Action Pl an for the Implementation of the TRIPS  Agreement presented in 
document WT/ACC/SAU/43, was being implemented.  Some TRIPS laws, for example, Trade Marks 
Law, including Geographical Indications, Copyright  Law and the GCC Patent Law (applicable to 
Saudi Arabia also) had already been enacted, while other IP laws, including the draft Law on Patents, 
Industrial Designs, Plant Varieties and Layout Designs  of Integrated Circuits, were at an advanced 
stage in the legislative process and would soon be enacted. 
247. The representative of Saudi Arabia stated that Saudi Arabia would apply fully all the 
provisions of the  Agreement on Trade-Related Aspects of Intellectual Property Rights from the date 
of accession to the WTO, without recourse to any transition period.  The Working Party took note of this commitment. 
POLICIES AFFECTING TRADE IN SERVICES
 
248. In addition to the Memorandum on the Foreign Trade Regime, the representative of 
Saudi Arabia provided the Working Party with info rmation on the services regime in Saudi Arabia in 
a Supplementary Memorandum on the Foreign Trade Regime, (WT/ACC/SAU/5); as well as 
supplementary background notes and informa tion in documents WT/ACC/SAU/23 and 24.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 83 
 
 
 249. Some members of the Working Party congratulated Saudi Arabia on its very liberal services 
regime.  They noted, in particular, the high numbe r of foreign workers and service providers already 
resident within Saudi Arabia. 
250. Some members of the Working Party requested clarification of the roles of various 
government agencies in the approval of new investme nts of foreign capital in the services sector.  In 
response, the representative of Saudi Arabia stated th at all foreign investment was to be approved by 
the newly created Saudi Arabian General Investment Authority (SAGIA) as a one-stop shop, except 
those activities listed in the negative list or wher e the power to license was assigned to an agency 
other than SAGIA. 
251. Some members of the Working Party requested information on the regulation of the financial 
services sector and in particular requested inform ation on the conditions under which a foreign bank 
could obtain a licence to establish a branch within Saudi Arabia.  In response, the representative of 
Saudi Arabia stated that banking firms' activities we re regulated by the Banking Control Law.  Under 
Article 2 of the Banking Control Law, a natural or  legal person was required to have a license to 
engage in a banking business.  Under Article 3 of the Law,  the licensing requirements for a Saudi 
national bank stipulated, inter alia , that it must be a Saudi joint stock company.  This included joint 
venture banks.  A foreign bank coul d be granted a licence to establish branches in Saudi Arabia if it 
satisfied the conditions determined by the C ouncil of Ministers upon the recommendation of the 
Minister of Finance.  The representative of Saudi  Arabia added that the Saudi Arabian Monetary 
Agency (SAMA) always acted consistently with the requirements of Articles XVI and XVII of the 
GATS when considering an application for a new licence.  Upon the recommendation of the 
Saudi Arabian Monetary Agency, the Minister of Finance and the Council of Ministers would evaluate the recommendation taking into account  the following objective considerations: the 
macroeconomic needs of the financial and banki ng system; the development of new products and 
services; the level of existing competition in the mark et; the benefits to the consumer; the introduction 
of new technologies; the impact on the financial stability and soundness of the banking system; the professional and business standing of the founders and members of the Board of Directors; and the 
capital adequacy of the proposed enterprise. 
252. He further added that Saudi Arabia provided for a wide range of judicial, arbitral and 
administrative procedures with respect to trade in services.  Saudi Arabia had administrative 
procedures for the review of administrative decisions affecting trade in services.  Such decisions could 
be appealed to the Board of Grievances under the Council of Ministers Resolution No. 190 of 16.11.1409 H Concerning Rules and Procedures to be Followed by the Board of Grievances and the WT/ACC/SPEC/SAU/4/Rev.3 
Page 84  
 
 Board of Grievances Law.  Commercial disputes were  generally covered by the Board of Grievances 
and some other standing and ad hoc committees.  Some members of the Working Party asked the 
representative of Saudi Arabia to provide inform ation on the review of decisions concerning the 
licensing of service providers in Saudi Arabia.  In response, the representative of Saudi Arabia stated 
that a number of Ministries and Agencies were involved in approval of the right to provide a service in Saudi Arabia; for example: the Ministry of Commerce and Industry for engineers, legal 
practitioners, accountants and insurers; the Ministry  of Defence and Aviation for civil aviation, 
tourism and travel agents; the General Organi zation for Technical Education and Occupational 
Training for technical institutes and national occupational centres; the Ministry of Health for medical practitioners, pharmacists, hospitals; the Ministry of Communications for maritime transport; and the 
Saudi Arabian Monetary Agency for banks and c ooperative insurance compan ies.  In all cases, the 
Ministries and Agencies involved had internal standi ng committees of senior officials to review initial 
administrative decisions pertaining to licensing.  Decisions of standing committees could be appealed to the responsible Minister or Agency head.  Ad ministrative Decisions involving potential civil suits 
against the government could be brought  before the Board of Grievances. 
253. In response to requests for information on the na ture and extent of incentives, tax exemptions 
and subsidies available to service providers in Saudi Arabia, on a national treatment basis, the 
representative of Saudi Arabia stated that no tax ho lidays were now available within the new Foreign 
Investment Regulations of April 2000 
254. In response to requests for information concerning restrictions on the provision of 
professional services, the representative of Saudi Ar abia stated that all professional services were 
treated in the same manner.  A licence was required to provide professional services.  To be eligible 
for a licence the company was required to be: reput able and well recognized in the field of its 
profession; to have been registered and successfully prac tising in the field for at least ten years; and to 
be prepared to participate in the training a nd the building of Saudi nationals' experience and 
introducing relevant technology.  In addition, the fo reign company should employ or have at least one 
representative in Saudi Arabia.  That representative should stay in Saudi Arabia for a period not less 
than nine months per year; have at least a university  degree in the field of the company specialization; 
and have not less than ten years experience su ccessfully.  In response to requests for further 
information concerning the conditions required to be fulfilled in order to be eligible for grant of a 
licence, the representative of Saudi Arabia stated that a foreign company would be considered as 
reputable, well recognized and practising in the field successfully if it was registered under the companies law of its home country, was certified as fi nancially viable by its bankers, produced copies 
of audited balance sheets for the last two years,  produced a list of previous contracts/assignments,  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 85 
 
 
 outside Saudi Arabia, certified by the Chamber of Commerce and Industry in the company's home 
country, and also produced certificates of satisfactory completion of assignments from former clients.  
Concerning the participation in training and the introduction of technology, the applicant company 
should give an undertaking that it would trai n Saudi nationals and would introduce the new 
technologies and know-how that it employed in its home country.  He also added that the foreign 
existing companies already licensed to operate in Saudi  Arabia had a period of one year to fulfil those 
conditions.  If they do not do that, the licence may be cancelled.  New companies had to fulfil the 
conditions from the beginning of their business activities. 
255. Some members of the Working Party asked whet her Saudi Arabia planned to liberalise the 
limitations placed on the participation of foreigne rs in security underwriting, commodity brokerage 
services and currency exchange operations, as well as the limitations placed on the participation of 
foreigners in land transportation and professiona l services.  In response, the representative of 
Saudi Arabia stated that although there were lim itations on the participa tion of both foreign and 
domestic individuals in providing security underwr iting, commodity brokerage services and currency 
exchange operations, there were no such limita tions on domestic and foreign banks, except the 
requirements to be licensed.  There were no plans to liberalise those conditions. 
256. Some members of the Working Party asked wh ether there were any instances of less than 
national treatment for foreign service providers.  The representative of Saudi Arabia stated that only Saudi Arabian nationals were a llowed to participate in commerc ial agencies, customs clearance 
agencies, real estate agency, transportation (land based transport and coastal shipping services) and 
civilian security.  Postal services, basic telecommunications services, radio and television transmission services were reserved to the State.  He  further added that under Article 8 of the Unified 
Economic  Agreement of the Gulf Cooperation Council, national treatment was provided for 
Gulf Cooperation Council nationals  in, among other things, freedom of movement, work and 
residence, right of ownership and freedom of exercising economic activity, including service activities 
and free movement of capital.  Saudi Arabia, t ogether with the other Gulf Cooperation Council 
members, was in the process of implementing this  Agreement.  In addition, some 
bilateral  Agreements signed by Saudi Arabia conferred preferred or reciprocal supplier status on 
companies from signatory countries w ith regard to certain services.   Agreements with Egypt and 
Jordan conferred reciprocal supplier status for cross-border truck and public transportation 
vehicles;  Agreements with Egypt and Tunisia granted preference to national shipping and transport 
modes in bilateral trade;  Agreements with Lebanon, Syria and Turkey provided for reciprocal 
treatment with regard to transpor tation and transport vehicles; and an  Agreement with Morocco 
included reciprocal airline privileges. WT/ACC/SPEC/SAU/4/Rev.3 
Page 86  
 
 257. In response to requests for information concer ning the rules governing temporary residence in 
Saudi Arabia by foreigners, the representative of Sa udi Arabia stated that the Law of Residency was 
enforced by the Ministry of Interior.  In addition,  the Ministry of Labour approved applications for the 
presence of foreigners who work or were given licen ce to practice work in the private sector.  Some 
members of the Working Party requested information on the system followed for employment of foreign employees and investors.  The representativ e of Saudi Arabia stated that once a foreign 
employee was offered a contract, a visa would be gran ted.  Business visitors would, however, require 
a letter or invitation or a copy of the relationship or  Agreement with a Saudi party. 
258. In response to questions concerning the limita tions placed upon the total number of natural 
persons employed in particular sectors, the represen tative of Saudi Arabia stated that as a matter of 
principle, work was considered a Saudi citizen's  right.  Consequently, a foreigner would not be 
employed when to do so would displace a Saudi worker.  The Labour and Workers Regulations 
required that any enterprise, Saudi or foreign owned,  would ensure that the percentage of the Saudi 
workers engaged by the employer should not be less than 75 per cent of the total workforce.  
However, the Regulations also permitted the Minister  of Labour to reduce the required percentage in 
circumstances where qualified Saudi workers were not available.  Foreign workers were required to 
obtain work permits from the Ministry of Labour, a nd an application for a permit was required to be 
accompanied by a submission from the proposed employer confirming the non-availability of qualified Saudis for the work.  All service providers activities, regardless of ownership were obliged 
to reserve certain positions for Saudis, including pe rsonnel officers, recruitment offers, receptionists, 
treasurers, civilian security guards, and transacti on follow-up clerks to government departments. 
259. Some members of the Working Party requested clarification of the qualification requirements 
and procedures for approval of foreign service pr oviders.  In response, the representative of 
Saudi Arabia stated that different categories of services required different types of approval.  For 
example, for medical services, the service provider should have a medical degree from a recognized 
institution.  For educational services, the ser vice provider should have adequate academic 
qualifications in the relevant disciplines from a university or a recognized institution.  For the 
provider of accounting and auditing service, the provider should be a certified accountant from a 
recognized institute.  In addition, all fore ign companies should possess the necessary technical 
expertise, financial capabilities, and occupational proficiency. 
260. In response to questions concerning restri ctions placed on foreign service providers 
procurement of business inputs, the representative of Saudi Arabia stated that all non-Saudi contractors must assign not less than 30 per cent of the works included in their contract to wholly- WT/ACC/SPEC/SAU/4/Rev.3 
 Page 87 
 
 
 owned Saudi companies.  All contractors were oblig ed to purchase the tools and equipment that they 
procure for performance of their contracts from Saudi agents for these tools and equipment in 
Saudi Arabia.  Contractors were required to obtain the following services from local Saudi 
establishments: transportation services for goods and ser vices within Saudi Arabia, (if the contractor 
did not perform this service by itself directly by  equipment owned by the business and with personnel 
directly employed by the business) banking services; services for the leasing and purchase of land and 
buildings; and catering services and supply of foodstuffs. 
261. Some members of the Working Party asked whether permission for a foreign owned service 
provider to own real property was automatic on ce the licence to engage in business activities as a 
foreign establishment in Saudi Arabia was obtained.  In response, the representative of Saudi Arabia 
stated that foreign establishments authorized to carry on their activities in the Kingdom under the 
Foreign Investment Law may own real estate only for a specific use related to the licensed project, in 
accordance with the rules on foreign ownership of real  estate.  The concerned Minister's approval of a 
request to own real estate is a prerequisite before its review by a Ministerial Committee headed by the 
Minister of Interior.  
262. In response to questions from members of the Working Party, the representative of 
Saudi Arabia provided the following information regarding the Kingdom's insurance regime.  He 
stated that Cooperative Insurance in the Kingdom  was undertaken through registered insurance 
companies operating in a cooperative manner as provided within the articles of the Law on 
Supervision of Cooperative Insurance Companies a nd in accordance with the principles of Islamic 
Shari'a.  Cooperative Insurance operated with the pur pose of maintaining an efficient, fair, safe and 
stable insurance market for the benefit and protec tion of policyholders and shareholders.  Cooperative 
insurance aimed to strengthen values like coopera tion and social solidarity (takaful) among the 
insured by indemnifying those among them who sustain losses insured against as well as sharing 
equitably the amount of such losses among themselves. 
263. The representative of Saudi Arabia further st ated that cooperative insurance companies 
offered both policyholders and shar eholders the opportunity to bene fit from their contributions and 
investments through the distribution of the surplus of insurance operations between the shareholders 
and policyholders.  To facilitate a clear accounting fo r the distribution of the surplus, the insurance 
and re-insurance operations accounts were kept separ ate from the shareholders investments accounts.  
Insurance operations accounts were maintained fro m the contributions paid to the company by 
policyholders and were reserved for payments of claims and expenses of the company's operation.  
Policyholders were entitled to a percentage of the surplus from the income generated from the WT/ACC/SPEC/SAU/4/Rev.3 
Page 88  
 
 operations and the return on investment from the policy holders' contributions at the end of the year in 
the form of reduction of premium or by monetary distribution.  Shareholders investments accounts 
were maintained from the investment of the share holders' capital and the insurance operations' fund.  
The net investment returns from the insurance operati ons fund were added as investment return to the 
insurance operations accounts and the rest  was available for the shareholders. 
264. The Implementing Regulations of this Law were to be issued by an order of the Minister of 
Finance and would specify the insurance activiti es covered in this Law.  The implementing 
regulations would provide transparency by maki ng public all rules and regulations affecting the 
insurance and reinsurance industry, would promote competition in the market place and would provide consumer and private-sector protection. 
265. Subject to the provisions of the Cooperativ e Health Insurance Law, promulgated by 
Royal Decree M/10, dated 1/5/1420H, the Cooperativ e Insurance Law granted the Saudi Arabian 
Monetary Agency (SAMA), through a clear, transpar ent and consistent regul atory and supervisory 
process, the powers to: 
Ii Review applications for licenses and issue recommendations for licensing to the 
Ministry of Commerce and Industry. 
ii. Authorize suspension and withdrawal of regulatory permission. iii. Approve board members of insurance a nd reinsurance companies, and external 
auditors. 
iv. Monitor solvency of insurance and re insurance companies through the establishment 
of general rules to ensure credit-worthi ness, capital adequacy, soundness of assets and 
technical provisions and ability to m eet obligations to policyholders. 
v. Inspect records directly or through auditors and request regulatory information. vi. Approve mergers and acquisitions of insurance and reinsurance companies. 
vii. Regulate and approve rules of investme nt in insurance and reinsurance operations. 
viii.. Establish minimum deposit limits and the amount of funds to be deposited in local 
banks to exercise each insurance activity. 
ix. Approve policy forms. x. Establish investment policy for in surance and reinsurance companies. 
xi. Intervene following violations of the rules, including requiring liquidations. 
xii. Establish the pre-conditions for gran ting licenses to provide insurance-related 
services, in particular:  insurance brokers, insurance consultants, inspectors and loss 
adjusters, experts in settling insurance claims and actuaries. 
266. The main object of the insurance and reinsuran ce companies was to engage in insurance and 
reinsurance activities, not to undertake any ot her activities unless they are complementary or 
necessary.  Insurance and reinsura nce companies could not directly own brokerage companies or 
establishments.  Reinsurance companies could not own reinsurance brokerage companies or 
establishments.  However, insura nce companies could, subject to obtaining the SAMA's approval, 
own companies or establishments engage d in reinsurance brokerage activities.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 89 
 
 
 267. The capital of the insurance company should not be less than SAR 100,000,000 and the paid-
up capital of a reinsurance company or an insuran ce company engaged at the same time in reinsurance 
activities should not be less than SAR 200,000,000.  The minimum capital should not be altered 
without the SAMA's approval and in accordance with the Companies Law. 
268. Following  the completion of bilateral negotiations with WTO Members, the schedule 
of specific commitments on services of Saudi Ar abia would be reproduced in Part II of the 
Annex to the Protocol of Accession of Saudi Arabia.   
Government Procurement  
269. Some members of the Working Party requested  that Saudi Arabia undertake to accede to 
the Agreement on Government Procurement upon accession to the WTO.  The representative of 
Saudi Arabia replied that the  Agreement on Government Procurement was a multilateral  Agreement, 
adherence to which was not a precondition for accession to the WTO.   
270. Members observed that government procurement accounted for a major part of Saudi Arabia's 
imports, and that Saudi participation in the  Agreement on Government Procurement was an important 
issue.  The benefits of joining the GPA included lower procurement costs and greater transparency.  
In particular, the transparency provisions of the  Agreement could be useful to Saudi Arabia in 
ensuring the least cost/best quality outcome for procurement in covered agencies.   
271. The representative of Saudi Arabia stated that, upon accession, his Government would seek 
observer status in the Government Procuremen t Committee and would follow the work of the 
Working Group on Transparency in Government Procurement Procedures.  The Working Party took note of this commitment. 
Transparency
 
272. Some members of the Working Party requested information on Saudi Arabia's 
implementation of the transparency requirements pr escribed in Article X of the GATT, Article III of 
the GATS and other WTO  Agreements.  They asked whethe r a legal obligation existed in 
Saudi Arabia to publish in an official journa l all laws, regulations, judicial decisions and 
administrative orders or rulings of general applica tion or other measures having similar effect relating 
to trade or economic policy "in such a manner as to enable governments and traders to become 
acquainted with them"; to what extent publication o ccurred prior to entry into force; and whether any 
such measures could enter into force without being published in the official journal. WT/ACC/SPEC/SAU/4/Rev.3 
Page 90  
 
 273. In response, the representative of Saudi Arabia  stated that Article 71 of the Basic Law 
requires that all laws be published in Umm Al-Qura , the Official Journal, before they entered into 
effect, and that laws become effective on the date of publication unless a later date was specified.  He 
added that the Umm Al-Qura  also is the official journal for publication of regulations, implementing 
regulations, decrees, decisions, Mi nisterial orders, international  Agreements and concessions, which 
also could not come into effect prior to publica tion there.  These rules, however, do not extend to 
administrative orders.  He further added that Artic le 47 of the Board of Grievances Law required the 
publication of judicial decisions.  There were no other requirements for publication or notification 
currently in effect.  He also confirmed that hi s government has set up operational enquiry points in 
conformity with the requirements of Article III of the General  Agreement on Trade in Services and 
the WTO  Agreements on TBT and SPS. 
274. A Member stated that timely review of legislation published in Umm Al-Qura  was difficult, as 
copies were not immediately available to the ge neral public and many private-sector entities were 
unable to obtain copies of laws and regulations with  sufficient time to become acquainted with their 
provisions prior to the date of implementation.  In addition, although all la ws and regulations were 
published in the Journal, the non-publication of  administrative orders presented problems of 
adjustment in cases of new import or export requirements.  This Member suggested that Saudi Arabia consider posting the Umm Al-Qura  on the internet to improve access by the public to laws, 
regulations, judicial decisions and administrative ru lings of general application, and welcomed any 
other practical steps taken by Saudi Arabia to en sure prompt and accessible publication of legislation 
and regulations in the Official Journal. 
275. The representative of Saudi Arabia confirmed that from the date of accession his government 
would fully implement Article X of the GATT 1994, Article III of the GATS and the other WTO transparency requirements, including those requiring notification and publication.  As such, all laws, 
regulations, decrees, judicial decisions and administ rative rulings of general application pertaining to 
or affecting customs issues, trade in goods, services,  intellectual property and the control of foreign 
exchange would be published promptly in the Umm Al-Qura  in a manner that fulfils the WTO 
requirements and no such law, regulation or other normative act or measure would become effective 
or be enforced prior to such publication.  He fu rther confirmed that the government also had decided 
to expand the transparency provided with regard to  legislation and measures having similar effect in 
the areas of trade and investment.  In this rega rd, Saudi Arabia would, from the date of accession, 
establish or designate an official website (and possi bly a supplemented official journal or an expanded 
Umm Al-Qura ), updated on a regular basis and readily available to WTO members, individuals and 
enterprises, dedicated to the publication of all regul ations, decisions, orders, administrative rulings of  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 91 
 
 
 general application, and other measures pertaining to or affecting trade in goods, services, and TRIPS 
prior to enactment.  The publication of such regulations and other measures would include, as 
appropriate, the names of the authorities (includi ng contact points) responsible for implementing a 
particular measure and the effective date of the measure.  Also, it would list the products and services 
affected by the particular measure, identified by appropriate tariff line and classification.  He added 
that Saudi Arabia intended to post the contents of current and past editions of the Official Journal on 
this website as well, and keep them current.  The Working Party took note of these commitments. 
Notifications  
276. The representative of Saudi Arabia said that, upon entry into force of the Protocol of 
Accession, Saudi Arabia would submit all notifications required by any  Agreement constituting part 
of the WTO  Agreements.  Any regulations subsequently enact ed by Saudi Arabia which gave effect to 
the laws enacted to implement any  Agreement constituting part of the WTO  Agreements would also 
conform to the requirements of that  Agreement.  The Working Party took note of these commitments. 
Trade  Agreements  
277. In response to questions the representative of Sa udi Arabia submitted the text of the Unified 
Economic  Agreement signed on 11 November 1981 under th e Gulf Cooperation Council.  He said 
that the free-trade  Agreement met all the requirements of Article XXIV of GATT  Agreement 1994, 
including in particular paragraphs 5 (b) and 8(b) thereof.  The free-trade area had eliminated duties 
and other restrictive regulations of commerce and al so all the trade between the members of the Gulf 
Cooperation Council in the products originating in the member states and work was proceeding to 
further harmonize trade and commercial policies.   He also submitted the programme for the 
implementation of the  Agreement Facilitating and Developing Trade Exchange among Arab States to 
create a Free Trade Area and the  Agreement Facilitating and Developing Trade Exchanges among 
Arab States.  Saudi Arabia would notify these  Agreements upon becoming a WTO Member. 
278. In response to further questions, the representa tive of Saudi Arabia stated that the GCC 
Customs Union had been established and was ope rative since the beginning of January 2003.  
Saudi Arabia and other GCC member states were applying the GCC common external tariff.  The rates of common external tariff for more than 85 per cent of the tariff lines were 5 per cent or 
0 per cent.  He said that future plans included the application of common external tariff to all items 
and steps towards a common market and a common currency. WT/ACC/SPEC/SAU/4/Rev.3 
Page 92  
 
 279. The representative of Saudi Arabia stated that  implementation of the Arab Free Trade Area 
was progressing with the aim of having a full-fledged free trade area from 2005.  Tariffs of member 
countries in the context of the Arab Free Trade Area had been reduced by 80 per cent.  Future plans 
included negotiations to create a customs union. 
280. Saudi Arabia and other GCC member states ha ve discussed with the European Communities 
the possibility of establishing a free trade area. 
281. The representative of Saudi Arabia stated that his Government would observe the provisions 
of the WTO including Article XXIV of the GATT 1994 and Article V of the GATS in its trade  Agreements, and would ensure that the provisions of these WTO  Agreements for notification, 
consultation and other requireme nts concerning free trade areas and customs unions of which 
Saudi Arabia was a member were met from the date of accession.  He confirmed that Saudi Arabia 
would, upon accession, submit notifications and copies of the GCC Customs Union and the Arab 
League Free Trade Area for review by the Committee on Regional Trade  Agreements (CRTA).  The 
Working Party took note of these commitments. 
CONCLUSIONS
 
282. [The Working Party took note of the explanations  and statements of Saudi Arabia concerning 
its foreign trade regime, as reflected in this re port.  The Working Party took note of the assurances 
given by Saudi Arabia in relation to certain specifi c matters which are reproduced in paragraphs [...] 
of this report.  The Working Party took note of the commitments given by Saudi Arabia in relation to 
certain specific matters which are reproduced in para graphs [...] of this report.  The Working Party 
took note that these commitments had been incorporated in paragraph 2 of the Draft Protocol of Accession of Saudi Arabia to the WTO.] 
283. [Having carried out the examination of the foreign trade regime of Saudi Arabia and in the 
light of the explanations, commitments and concessi ons made by the representative of Saudi Arabia, 
the Working Party reached the conclusion that  Saudi Arabia be invited to accede to the 
Marrakech  Agreement Establishing the WTO under the provisi ons of Article XII.  For this purpose, 
the Working Party has prepared the draft Deci sion and Protocol of Accession reproduced in the 
Appendix to this report, and takes note of Saudi Arabia's Schedule of Concessions and Commitments 
on Goods [to be prepared] and its Schedule of Sp ecific Commitments on Services [to be prepared] 
that are annexed to the Protocol.  It is proposed  that these texts be adopted by the General Council 
when it adopts the report.  When the Decision is  adopted, the Protocol of Accession would be open 
for acceptance by Saudi Arabia which would become  a Member thirty days after it accepts the said  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 93 
 
 
 Protocol.  The Working Party agreed, therefore,  that it had completed its work concerning the 
negotiations for the accession of Saudi Arabia to the Marrakech  Agreement Establishing the WTO.] WT/ACC/SPEC/SAU/4/Rev.3 
Page 94  
 
 [TO BE COMPLETED.] 
ANNEXES 
Annex A: List of Items Subject to Price Controls Annex B: Comparison of the Old 1979 Forei gn Investment Law and the New 2000 Foreign 
Investment Law 
Annex C: Summary of the Provisions of the Capital Market Law 
Annex D: SASO Seed Specifications 
Annex E: List of Products Subject to Non-Automatic Import Licensing Requirements Annex F: List of Banned Imports Annex G: List of Banned Exports Annex H: List of Exports Subject to Authorization/Licensing 
Annex I: List of Items Subject to Mandatory Certification 
Annex J: List of Items Subject to Pre-shipment Inspection Annex K: List of SPS Measures Maintained by the Kingdom of Saudi Arabia (to be submitted)  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 95 
 
 
 ANNEX A 
List of Items Subject to Price Controls  
Controlled Price Item No. 
SAR 20/21 per 40 kg Wheat 1. 
6–12 Halalas/Litre Fuel oil 2. 
90 Halalas/Litre Gasoline 3. 
37 Halalas/Litre Diesel 4. 
43.5 Halalas/Litre Kerosene 5. 
72 Halalas/Litre Liquefied Petroleum Gas (LPG) 6. 
300 SAR/Metric Ton Asphalt 7. 
(1 SAR = 100 halalas) 
The Council of Ministers is the responsible legal authority. WT/ACC/SPEC/SAU/4/Rev.3 
Page 96  
 
 ANNEX B 
Comparison of the Provisions of the Old and New 
 
Foreign Investment Laws In Saudi Arabia  
The old Foreign Investment Law was enacted in 19 79.  The new Foreign Investment Law was enacted 
vide Royal Decree No. M/1 dated 9 April 2000 to  replace the 1979 law.  Under the old Law, the 
licensing authority for foreign investment was the Fo reign Investment Secretariat of the Ministry of 
Industry and Electricity.  Under the new law, the licensing authority is the Saudi Arabian General 
Investment Authority (SAGIA).  The primary other differences between the ol d and the new laws are 
as follows: 
Authorities Providing Services to and Regulating Investors  
Old Law:  Several Ministries and Government Agencies. 
New Law:  Saudi Arabian General Investment Authority (SAGIA) Investor Service Centres 
(One-Stop-Shop).  (SAGIA comprises representatives from nine investment-
related ministries.) 
Investment Fields Open to Foreign Investors  
Old Law:  The Old Law required that the pr oject be a development project approved under 
the National Development Plan and that the project be accompanied by foreign 
technical skills and expertise to facilitate  technology transfer and be approved as 
viable by the Foreign Investment Bureau. 
New Law:  All fields are open for investment, except those included in the negative list. 
Period for Taking a Decision on the Investment Application  
Old Law:  Not specified. 
New Law:  Maximum 30 days. Possibility of Obtaining More Than One License
 
Old Law:  Restricted, had to be in the same activity. 
New Law:  The foreign investor may obtain more than one license in diverse activities. Type of Foreign Investment
 
Old Law:  Law favoured joint ventures over 100 per cent foreign-owned projects. 
New Law:  100 per cent foreign-owned projects are allowed by the new law, in addition to 
joint ventures.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 97 
 
 
 Incentives  
Old Law:  Foreign capital enjoyed the in centives offered to national capital only in 
manufacturing industries.  The Saudi share in ownership had to be 25 per cent or 
greater. 
New Law:   The foreign investment project en joys all of the incentives and privileges offered 
to local projects. 
Investment Guarantees  
Old Law:  None were specified.  No expropriation cases since 1957. 
New Law:  The foreign investor has the right to transfer his share derived from selling his 
equity or profits out of the Kingdom, as well as any amounts required for the 
settlement of contractual obligations pertai ning to the project.  Investment related 
to the foreign investor shall not be confiscated without a court order.  They may not be subject to expropriation except for th e public interest and in exchange for an 
equitable compensation according to regulations. 
Real Estate Ownership
 
Old Law:  Foreign ownership of real-estate by foreign investors was prohibited. 
New Law:  The foreign facility licensed under th e Foreign Investment Act is entitled to any 
real-estate for practicing the licensed activit y and for the housing of staff.  Also the 
Real-Estate Regulation allows foreign i nvestment in real-estate worth SAR 30 
million or more. 
Penalties for Violations  
Old Law:  Kingdom could cancel of license or deny of incentives, after investor received 
warning from the Ministry of Industry a nd Electricity to correct the violation 
within a certain period.  Investors could appeal to the Board of Grievances within 
30 days. 
New Law:  A petition against any penalty may be brought by the investor before the Board of 
Grievances.  Possible penalties include: 
- Withholding incentives offered to the foreign investor. 
- Imposing a fine not exceeding SAR 500.000. 
- Cancellation of license in case of continuity of violation after a written 
notification to rectify the violation within a certain period specified by 
SAGIA. 
Tax Exemption  
Old Law:  Industrial and agricultural projects we re offered a ten year tax holiday and other 
projects a five year holiday, provided that the local share forms 25 per cent of the 
project capital.  The tax on profits was up to 45 per cent. WT/ACC/SPEC/SAU/4/Rev.3 
Page 98  
 
 New Law:  Taxes on profits were reduced to 30 per cent and losses may be transferred to 
coming years.  A further tax reduction is under discussion. 
Sponsorship
 
Old Law: Foreign investors had to be sponsored by a Saudi citizen. 
New Law:  The requirement of the old law was removed.  The foreign investor and his non-
Saudi staff shall be sponsored by the licensed investment project.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 99 
 
 
 ANNEX C  
Summary of Provisions of the Capital Market Law  
Chapter 1 sets out the definitions of the terms used in the law.  The Capital Market Authority (CMA) 
has rule-making authority to further define what is or will not be deemed a security.  This assures 
necessary flexibility and certainty.  The CMA is forma lly created in Chapter 2, which also sets forth 
the CMA's extensive rule-making powers, organizati onal structure and duty to report annually to the 
President of the Council of Ministers.  Chapter 3 creates the Saudi Arabian Securities Exchange as a 
joint stock company and empowers it to adopt by-laws for the purpose of establishing and enforcing high professional and ethical standards for brokers .  The CMA is also required to establish and 
maintain a Securities Violation Tribunal with jurisdiction over all disputes. 
Chapter 4 requires the Exchange to establish th e Securities Deposit Centre, which will be the 
exclusive organization for clearing, settling and re gistering ownership of securities traded on the 
Exchange.  Chapter 4 provides that the records of the centre are conclusive evidence of ownership for 
securities traded on the Exchange and authorizes the Exchange to adopt rules necessary to assure 
efficient and reliable clearance, settlement and regi stration.  Under Chapter 5, brokers must be 
licensed.  Licensing requirements are established and administered by the Exchange but the actual 
issuance of license is by the CMA based on a reco mmendation by the Exchange.  Chapter 6 provides 
that, commencing in 2005, the CMA has the authority to adopt rules regulating enumerated aspects of 
the activities of investment funds, collective trusts, investment managers and investment advisers.  
Until 2005, the regulation of these entities (Bank Investment Funds) and parties will remain with the 
present regulators. 
The disclosure procedures for public offers of securities and the on-going disclosure requirements for 
the issues of publicly traded securities are set forth in Chapter 7.  No sales through a public offer of a 
security can occur until a prospectus is published and the CMA has approved the prospectus.  Such 
approval is granted upon the CMA being satisfied that the prospectus fulfils the disclosure 
requirements as set forth in the CMA's regulations .  Chapter 8 authorizes the CMA to issue rules 
defining what constitutes manipulation, as well as insi der trading and tipping of inside information. 
Advance notice of a possible takeover is the s ubject of Chapter 9; anyone who increases his 
ownership of a class of equity security listed on the Exchange so that he will own 10 per cent or more 
of a company must file certain information about  himself and such other information as the CMA's 
regulations require.  These provisions are similar to early-warning disclosures in other countries.  
Chapter 9 authorizes the CMA to adopt a range of s ubstantive protections for the shareholders of the 
firm that is the target of a takeover.  Chapter 10 is the final chapter of the Capital Market Law.  It sets 
forth the CMA and private investor action that can be  brought for violations of any provision, rule or 
regulation of the Capital Market Law.  WT/ACC/SPEC/SAU/4/Rev.3 
Page 100  
 
 ANNEX D 
 
SASO Seed Specifications
 
 
1. Seed must be true to type, from the first generation certified and produced directly from 
registered seed and the product of the preceding growing season.   
 2. Each consignment must include a certificate indicating the following: 
 
- Date and place of production (name of country, state or province and city) 
- Purity percentage 
- Germination percentage 
- Vitality of the seeds 
- Inert matter percentage 
- Weed seeds (including number of seeds and varieties in a sample of 2 kg) 
- Barley seeds (include number of seeds in a sample of 2 kg wheat seeds) 
- Moisture percentage 
 
The certificate must be from a national lab or an authorized government lab (including a state lab if the seeds are imported from the US). 
For seeds imported from Canada or Europe, the I STA (International Seed Testing Association) 
Orange Certificate must be presented. 
 3. The seeds must be treated with either
:  
- fungicide Triadimenol (commercially known as Baytan) (15 - 30 per cent); or 
- a mixture of Triadimenol 7.5 per cent and Imazalil 3 per cent at the rate recommended by 
the US EPA; or   
- fungicide Brochlora 10 per cent and Carb endazim 40 per cent (commercially knows as 
Prelude) at the rate of 2 kg/ton of seed; or 
- fungicide Carboxin 17 per cent and Thiram 17 per cent (commercially known as Vitavax 
200) at the rate of 2.5 kg/ton of seed. 
 
4. All growing seeds must be red in colour and homogeneously treated in order to differentiate 
them from consumption seeds. 
 5. The consignment must follow all the rules and international regulations of ISTA concerning 
seed testing and seed bag markings.  The information on the bags must be clear in the English 
and Arabic languages and must specify that th e seed was treated with poisonous chemicals 
and is not fit for human or animal consumpti on.  The skull and cross-bones danger sign must 
be printed on the bags. 
 Conditions and Requirements
 
 
1. The release of any consignment or shipment depends on the result of the analysis of a random 
sample taken by the technician of MOA at the arrival port.  The MOA technician will determine the fitness of the seeds. 
 2. Each consignee must submit the following documents: 
a) Complete name and address of the importer 
b) Name and address of the seed exporter  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 101 
 
 
 c) Name of the seed variety(ies) 
d) Quantity imported (net weight) e) Price CIF arrival port 
 
3. The consignee also must submit the following certificates: 
a) Field inspection certificate from the authoriti es in the country of origin indicating that 
the fields were inspected and determined to be fit for seed production. 
b) Certificate of origin issued by the government authorities in the exporter's country. c) Legalized certificate from the authorities indi cating the name of the fungicide used for 
the treatment of the seeds and the rate, method and date of application. 
d) If the seeds are imported from Europe, a certificate stating that they are free from 
radiation.  This certificate must be legalized by the Saudi Embassy in the exporter's country. 
 
4. The importer may not use or sell the seeds unl ess it receives a letter from MOA's Director of 
Research including the results of the analys is performed pursuant to paragraph 1, above. 
5. A seed consignment must be inspected befo re shipment to confirm that it fulfils the 
specifications and conditions for importation.  This can be done by sending a representative 
from the importing company or through an independent lab.   
6. A letter of credit must be opened at a bank in Saudi Arabia. 7. The last date for the arrival of a seed shipment  to Saudi ports is within the time frame of the 
importing license.   
8. No seed consignment shall be  released without a letter issued by the Director of Plant 
Quarantine stating that the above conditions have been satisfied. 
Conditions for Rejection of a Shipment
 
 
1. Any shipment imported without prior permission from MOA, or not fulfilling the 
specifications and conditions set out in the previ ous section, will be rejected.  The importer of 
the seeds will be fully responsible for all necessary actions, including the re-export of the 
seeds to his country. 
2. Any consignment will be rejected if the percentage of the following is less than 
recommended. 
a) Purity percentage less than 98 per cent 
b) Germination percentage less than 92 per cent c) Inert matter percentage not more than 1 per cent d) Moisture percentage not more than 12 per cent e) Barley seeds percentage (in shipments of wheat seed) – not more than five kernels of 
barley in a 2 kg sample. 
 3. Any shipment that contains weed seeds that  are especially difficult to control, such as 
Avenaspp – lollium, phalaris spp, or parasitic  herbs such as cuscuta spp obanche spp, striga 
spp, or bromus spp, shall be rejected. 
4. Any shipment in which the total weed seeds (o ther than those mentioned above) is more than 
five seeds per kg of wheat or barley will be rejected. WT/ACC/SPEC/SAU/4/Rev.3 
Page 102  
 
  
5. Any shipment will be rejected unless the la b test shows it is free from the following diseases: 
a) Ergot attack of wheat and barley caused by fungus claviceps puprpurea. 
b) Karnal bunt attack of wheat and caused by fungus neovossia indica. c) Southern blight attack of wheat caused by sclerotium rolfsii. 
d) Loose smut attack of wheat caused by ustilago tritici, and of barley caused by ustilage 
nuda. 
e) Semi-loose smut attack of barley caused by ustilago nigra. f) Flag smut attack of wheat caused by urocystis agropyri. g) Cover smut attack of wheat caused by tilletia spp and in barley caused by ustilago 
hordia. 
h) eptoria leaf and glume blotch attack of wheat and barley caused by septoria spp. i) Helminthosporium spot blotch attack of wheat and barley caused by 
helminthosporium satirium. 
j) Barley scald attack of barley caused by rhynihosporium secalis. 
k) Net blotch attack of wheat caused by helminthosporium teres. 
l) Barley stripe attack of barley caused by helmunthosporium granineum. m) Scab or head blight attack of wheat and barley caused by Fusarium spp. n) Take all attack of wheat and barley caused by gacumannomyces graninis vartriaci. o) Snow mold attack of wheat caused by fusarium nivale. p) Black point attack of wheat caused by alternaria, helminthosporium and fusarium spp. 
 
Bacterial Diseases
 
 1. Bacterial leafstreak or black chaff attack of  wheat and barley caused by bacteria xanthomonas 
translucens. 
 
2. Bacterials leaf blight attack of wheat a nd barley caused by bacteria pseudomonas syrinag. 
 3. Bacterial spike blight attack of wheat and ba rley caused by bacteria corynebacteriaum tritici. 
 4. Bacterial basal glume rot attack of wheat and barley caused by pseudomonas atrofaciens. 
 
Viral Diseases
 
 1. Barley stripe mosaic virus.  
Nematodes Diseases
 
 2. Ear cockle caused by Anguina tritici.  3. In addition, a shipment can be rejected if  there is evidence of a ttack by any other seed 
transmission diseases where the number of attack seeds is at least 5 seeds/kg. 
 
4. A shipment or consignment can be rejected if there is evidence of attack by any kind of 
insects at any stage.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 103 
 
 
 ANNEX E 
List of Imports Subject to Non-Automatic Licensing  
S. No. HS Code Description WTO Justification 
1. 01 01 10 10 Horses GATT Art. XI:2(b) 
2. 01 01 90 10 Horses  
3. 01 01 90 20 Horses  
4. Chapters 28 and 29 Chemicals GATT Art. XXI 
5. 30.03 Medicines GATT Art. XX(b) 
6. 30.04 Medicines  
7. 31 02 30 00 Explosives, GATT Art. XXI 
8. 31 02 50 00 fireworks,  
9. 36 01 00 00 gunpowder,  
10. 36 02 00 00 potassium chlorate,  
11. 36 03 00 10 gelatin, radiating  
12. 36 03 00 20 element, sodium  
13. 25 01 00 30 chloride, paraffin,  
14. 35 03 00 10 sodium nitrate, and  
15. 90 22 19 10 ammonium nitrate  
16. 90 22 19 90   
17. 27.12, except 
27 12 10 00   
18. 31.02 Chemical fertilizers GATT Art. XXI 
19. 31.03 Chemical fertilizers  
20. 31.04 Chemical fertilizers  
21. 31.05, except 
31 02 30 00 and 31 02 50 00 Chemical fertilizers  
22. 36 04 10 00 Lighting fireworks for GATT Art. XXI 
23. 36 04 90 00 Occasions  
24. 38 08 30 00 Herbicides, anti-sprouting products, 
plant-growth regulators GATT Art. XX(b) 
25. 58 07 10 00 Military uniforms, badges of  GATT Art. XXI 
26. 85 07 90 00 ranks, chevrons and military   
27. 85 08 90 00 accessories such as clichés,   
28. 73 26 90 99 protective suits, electric batons,   
29. 93 04 00 90 night vision binoculars,  
30. 90 05 10 00 and helmets etc., for  
31. 65 06 10 30 any of the military sectors  
32. 83 01 40 90 Security e quipment such as security 
surveillance  GATT Art. XXI 
33. 85 25 40 00 cameras, CT V systems, anti-theft alarm 
systems,  
34. 85 31 10 00 magnetic card or thumb impression 
operated  
35. 90 22 19 90 access/exit door s and equipments, metal   
36. 90 22 19 10 detecting doors and equipments, 
baggage   
  screening equipments  
37. 84 19 40 00 Distillation equipment GATT Art. XX(a) 
38. 84 59 61 00 Key cutting, copying and repairing 
machines GATT Art. XX(d) 
39. 84 59 69 00 and instruments of any type  
40. 84 72 30 00 Postage franking machines GATT Art. XX(d) 
41. 85 25 20 11 Transmission apparatus GATT Art. XXI WT/ACC/SPEC/SAU/4/Rev.3 
Page 104  
 
 S. No. HS Code Description WTO Justification 
42. 85 25 20 19   
43. 85 25 20 20   
44. 85 25 20 30   
45. 85 25 20 40   
46. 85 25 20 50   
47. 85 25 20 60   
48. 85 25 20 90   
49. 85.26 in addition to 
any other relevant 
heading   
50. 87.03 Armored vehicles GATT Art. XXI 
51. 89 02 00 00 Fishing vessels GATT Art. XXI 
52. Chapter 93 Arms and ammunitions GATT Art. XXI 
53. Different headings Wild animals and products thereof, 
according to CITES GATT Art. XX(b) 
54. Different headings Cultural and archeological property GATT Art. XX(f) 
55. Different headings Products containing currency pictures, 
models or wrappers in shape of currency 
or otherwise. GATT Art. XX(d) 
  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 105 
 
 
 ANNEX F 
List of Banned Imports  
S. No. HS Code Description WTO Justification 
1. 01.03  Live swine, meat, fat, hair, blood, guts, limbs  GATT Art. XX(a) 
2. 02 09 00 10 and all other products of swine  
3. 02 06 30 00   
4. 02 06 41 00   
5. 02 06 49 00   
6. 02.03    
7. 05 02 10 00   
8. 02 10 11 00   
9. 02 10 12 00   
10. 02 10 19 00   
11. 15 01 00 30   
12. 16 02 41 00   
13. 16 02 42 00   
14. 16 02 49 00   
15. 41 03 30 00   
16. 15 03 00 11   
17. 15 03 00 21   
18. 15 03 00 91   
19. 16 01 00 31   
20. 16 01 00 21   
21. 16 01 00 11, in 
addition to other relevant 
headings   
22. 01 06 19 40 Dogs, other than hunting dogs, guard dogs or 
guide dogs for the blind, accompanied with a 
certificate from a compet ent authority at the 
country of exportation duly qualified by the Saudi Arabian embassy stated therein that the 
dog to be admitted is a hunting dog, guard 
dog or guide dog for the blind, in addition to submitting to the veterinary quarantine. GATT Art. XX(a) 
23. 02 08 20 00 Frog meat GATT Art. XX(a) 
24. 09 08 10 00 Narcotics of all types, forms and descriptions GATT Art. XX(b) 
25. 09 08 20 00   
26. 12 07 91 00   
27. 12 07 99 10   
28. 12 07 99 20   
29. 12 11 30 00   
30. 12 11 40 00   
31. 12 11 90 20   
32. 12 11 90 60   
33. 13 02 11 00   
34. 13 02 19 10   
35. 29 39 91 10, in 
addition to other relevant 
headings   
36. 31.01 Animal or vegetable raw natural organic 
fertilizer GATT Art. XX(b) 
37. 12 11 90 90 Goro nut GATT Art. XXI WT/ACC/SPEC/SAU/4/Rev.3 
Page 106  
 
 S. No. HS Code Description WTO Justification 
38. 12 11 90 90 Betel GATT Art. XX(b) 
39. 22.03 Alcoholic beverages and intoxicants of all GATT Art. XX(a) 
40. 22.04 kinds, including those containing alcohol  
41. 22.05 in any intoxicating proportion;  
42. 22.06   
43. 22 07 20 90   
44. 22.08, except 22 
08 90 11 and  
22 08 90 19   
45. 24 03 99 20 Tobacco snuff – Tobacco "sawika" GATT Art. XX(b) 
46. 25 24 00 00 Asbestos and products thereof GATT Art. XX(b) 
47. 29.31 Sarin toxic gas GATT Art. XX(b) 
48. 36 04 10 00 Fireworks of the kind used by children such as 
snaps, rockets, sulfuric jitters and night stars, 
etc, falling within this scope GATT Art. XX(b) 
49. 40.12, except 
40 12 90 00 Used and treaded tyres GATT Art. XX(b) 
50. 49 01 99 10 The Holy Quran GATT Art. XX(a) 
51. 49 07 00 11 Saudi Arabian stamps GATT Art. XX(d) 
52. 49 09 00 20 Greeting Cards w ith electric circuit GATT Art. XXI 
53. 49 11 10 90 Coupons of Hadi (sacrificial animals) GATT Art. XX(d) 
54. 49 11 10 90 Blank invoices of foreign companies abroad GATT Art. XX(d) 
55. 85 12 30 00 Security car radar detection equipments GATT Art. XXI 
56. 85 25 20 90 Video Booster GATT Art. XXI 
57. 85.42 Mobile chips and prepaid mobile cards GATT Art. XX(d) 
58. 85 31 80 90 Apparatus releasing sounds of Police Car 
sirens or of some animals GATT Art. XXI 
59. 87.03 Damaged cars except if the damage occurred 
at the port of arrival GATT Art. XX(b) 
61. 88 02 11 00 Remote-controlled airplanes and parts thereof GATT Art. XXI 
62. 88 02 20 00   
63. 95 05 80 00   
64. 97 05 00 00 Mummified animals GATT Art. XX(a) 
65. Different 
Headings All foodstuff containing animal blood in their 
manufacturing GATT Art. XX(a) 
66. Different 
Headings Drink having description of Zamzam GATT Art. XX(a) 
67. Different 
Headings All types of machines, equipment and tools 
for gambling or games of chance GATT Art. XX(a) 
68. Different 
Headings Industrial waste and hazardo us refuse GATT Art. XX(b) 
69. Different 
Headings Kuwait and Iraq war leftover equipment and 
machinery GATT Art. XXI 
70. Different 
Headings Publicity material for cigarettes of any kind GATT Art. XX(b) 
71. Different 
Headings Satellite Internet r eceiver GATT Art. XXI 
72. Different 
Headings Mobile phone fitted with camera GATT Art. XXI 
73. Different 
Headings Products polluted by radiation or nuclear dust 
(e.g., watches of trademark Trophy) GATT Art. XX(b)  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 107 
 
 
 ANNEX G 
List of Banned Exports  
S. No. HS Code Description WTO Justification 
1. 01.01 Pure-bred horses GATT Art. XX (b) 
2. 01.02 Pure-bred bovine animals GATT Art. XX (b) 
3. 01.04 Pure-bred sheep and goats GATT Art. XX (b) 
4. 0602.2010 Date palm saplings of following types: Khalas, 
Nabut Saif, Munifi, Sa fri, Magfizi, Barhi, 
Sukkari, Shalabi, Safari, Barni, Ajwa, Ambara, 
Hulwa and Rothana GATT Art. XX (b) 
5. 12.14 Green fodder and hay GATT Art. XX (b) 
6. 22.01 Zamzam water GATT Art. XX (a) 
7. 44.01 Wood GATT Art. XX (j) 
8. 72.04 Scrap iron GATT Art. XX (d) 
9. 8407.2100 Boat engines GATT Art. XXI 
10. 97.06 Antiques, archaeological, and historical items Art. XX(f) of GATT 1994 
 WT/ACC/SPEC/SAU/4/Rev.3 
Page 108  
 
 ANNEX H 
List of Exports Subject to Authorization/Licensing
 
S. No. HS Code Description WTO Justification 
1. 01 01 10 10 Horses GATT Art. XI: 2(b) 
2. 01 01 90 10 Horses  
3. 01 01 90 20 Horses  
4. 10.01 Wheat GATT Art. XX (a) 
5. 11.01 Wheat  
6. Chapter 25 Sand, white rock (silica), base sand, crusher 
aggregates, limestone and marble stone GATT Art. XX (i) 
7. 25.23 Cement and clinker GATT Art. XX (i) 
8. 27.13 Asphalt, fuel oil, gasoline, diesel, kerosene,  GATT Art. XX (g) 
9. 27.14 Liquefied Petroleum Gas (LPG), and Natural 
Gas (Methane and Ethane)  
10. 27 10 11 41   
11. 27 10 11 42   
12. 27 10 11 49   
13. 27 10 11 14   
14. 27 10 11 31   
15. 27 10 11 32   
16. 27 10 11 33   
17. 27 10 11 39   
18. 27 11 13 00   
19. 27 11 12 00   
20. 27 11 11 00   
21. 27 14 90 10   
22. 27 10 11 29   
23. 27.15   
24. 28.45 Radioactive elements GATT Art. XX (b) 
25. 28.44 Radioactive elements  
26. 90 22 19 10 Radioactive elements  
27. 90 22 19 90 Radioactive elements  
28. 29 03 19 90  Ozone depleting materials GATT Art. XX (b) 
29. 29 03 42 00 Ozone depleting materials  
30. 29 03 43 00 Ozone depleting materials  
31. 29 03 44 00 Ozone depleting materials  
32. 29 03 45 20 Ozone depleting materials  
33. 29 03 69 00 Ozone depleting materials  
34. 29 03 19 90 Ozone depleting materials  
35. 29 03 19 10 Ozone depleting materials  
36. 29 03 14 00 Ozone depleting materials  
37. 29 03 47 00 Ozone depleting materials  
38. 29 03 46 00 Ozone depleting materials  
39. 29 03 30 00 Ozone depleting materials  
40. 85 48 10 00 Ozone depleting materials  
41. 30.03 Medicines GATT Art. XX (b) 
42. 30.04 Medicines  
43. 73 11 00 30 Filled gas cylinders GATT Art. XXI 
44. 84.32 Agricultural equipment GATT Art. XX (d) 
45. 84.33 Agricultural equipment  
46. 84 24 81 10 Agricultural equipment  
47. Different 
Headings Wild fauna and flora, and products thereof GATT Art. XX (g)  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 109 
 
 
 ANNEX I 
Items Subject to Mandatory Certification  
Item Harmonised System Commodity Codes 
Group I – Toys 
Toys, incl.  Video Games and other Electroni c Toys 8712.00 / 9501 / 9502 / 9503 / 9504.10 / 9504.90 / 9505 / 
From 9506.99 / 
Playground, Amusement and Fairground Equipment 9508 / From 3407 / 
Group II - Electrical and Electronics 
Air conditioning systems up to 60,000 btu (5 t ons)  8415.10.20 / 8415.81.20 / 8415.82.20 / 8415.83.20 
Combined function audio a nd/or video systems (non 
professional) 8518.30 / 8518.50 / 8520.30 /Combinations of II-03, II-04, II-
41, II-43 
Non professional stand-alone audio products (except 
radio receivers) 8518.21 / 8518.22 / 8518.29 / 8518.40 / 8519.21 / 8519.29 / 
8519.31 / 8519.39 / 8519.92 / 8519.93 / 8519.99 / 8520.20 / 
8520.90 
Video playing and recording systems (non professional)  8521.10 / 8521.90 / 8525.40 /  
Generator sets up to 12 kw  8502.11 / 8502.20  
Motors up to 12kw  8501.10 / 8501.31 / 8501.32 / 8501.40 / 8501.51 / 8501 
Fax and telex machines 8517.21 / 8517.22 
Household cooking appliances  8516.60 / 8516.72 
Clothes washing machines up to 10 kg and household 
dish-washing machines 8450.11 / 8450.12 / 8450.19 / 8422.1 
Clothes drying machines up to 10 kg 8451.21 
Electric irons, ironers and clot hes steamers 8451.30 / 8516.40 / 8516.32 
Domestic electromechanical kitchen appliances incl.  
Food processors, meat choppers and grinders 8509.40 / 8509.80 
Personal care/grooming appl iances (shavers, hair 
clippers, hair-removal de vices and massagers)  8510.10 / 8510.20 / 8510.30 / 9019.10  
Lift and elevator systems 8428.10 / 8431.31 
Household microwave ovens 8516.50 
Electric ovens up to 10 kw  8516.60 
Copy machines and accessories 9009.11 / 9009.12 / 9009.30 / 9009.21 / 9009.22 / 9009.90 
Personal computers (desktops/p ortables), storage units, 
peripherals and other input/output devices 8471.41 / 8471.49 / 8471.50 / 8471.60 / 8471.70 / 8473.30 
Power transformers and distribution transformers up to 
1000 kva 8504.21 / 8504.22 / 8504.31 / 8504.32 / 8504.33 / 8504.34 
Household refrigerators and freezers up to 40 cu ft incl. 
Household refrigerating display cabinets  8418.10 / 8418.21 / 8418.22 / 8418.29 / 8418.30 / 8418.40 / 
8418.50 
Telephone sets, incl.mobile, cordless telephones, and 
modems  8517.11 / 8517.19 / 8517.50 / 8525.20  
Electric wires and cables up to 1000v 8544.51 / 8544.59 
Non-industrial vacuum cleaners, water suction 
appliances and shampooers  8509.10 / 8509.80  
Household electric fires and heaters  8516.29 / 8516.21  
Drinking water coolers and fountains 8418.69.10 
Evaporative air coolers (desert coolers and humidifiers) 
up to 1.5 kw 8415.10.10 / 8415.82.10 / 8415.82.90 / 8415.83.10 / 
8415.83.90 
Domestic electric fans 8414.51 / 8414.60 
Compressors for cooling units up to 60,000 btu 8414.30 
Tea and coffee brewing appliances, and appliances for heating liquids 8516.71 
Incandescent, fluorescent and discharge luminaires, 
fixtures and lampholders 9405.10 / 9405.20 / 8536.61  
Manually operated household switches, circuit breakers 
and fuses up to 40a  8536.10 / 8536.20 / 8536.50 
Incandescent, fluorescent and discharge la mps  8539.21 / 8539.22 / 8539.29 / 8539.31 / 8539.32 
Ballasts for discharge type  lamps (including tubular 
fluorescent lamps) 8504.10 WT/ACC/SPEC/SAU/4/Rev.3 
Page 110  
 
 Item Harmonised System Commodity Codes 
Starters for discharge type  lamps (including tubular 
fluorescent lamps)  8532.10 
General use mains plugs, so cket outlets and mains 
configuration adapters  8536.69 
Luminaires for road and street lighting 9405.40 
Batteries, including rechargeable and automotiv e 8506.10 / 8506.30 / 8506.40 / 8506.50/ 8506.60 / 8506.80 / 
8507.10 / 8507.30 / 8507.40 
Immersed swimming pool luminaries 9405.40 
Hair care equipment (hand-held  hair dryers, hair curlers, 
waving apparatus and curling tong heaters)  8516.31, 8516.32 
Water pumps up to 12 kw 8413.70 
TV sets (colour/black and white) 8528.12 / 8528.13 
General use mains voltage converters, power supplies 
and battery chargers  8504.40  
Stand alone radio receivers 8527.12 / 8527.13 / 8527.19 / 8527.21 / 8527.29 
Storage and instant type water heaters up to 200 litres 8516.10 
Watt hour meters 9028.30 
Household sewing machines  8452.10  
Group III - Automotive  
Passenger automobiles, trucks, buses and multi-
purpose vehicles (new) 8701 / 8702 / 8703 / 8704 / 8705 
Passenger automobiles, trucks, buses and multi-
purpose vehicles (used) 8701 / 8702 / 8703 / 8704 / 8705 
Automotive glass (windshield, side and rear glass) 7007.21 
Vehicle spare parts (new),  including radiators and 
hoses, brakes and parts, lights, filters, silencers and 
exhaust pipes, clutches and parts, child restraints, 
spark plugs, wiper blades and motors, safety belts, fuel tanks, mirrors, bumpers, door locks and 
hinges, tire tubes, and v-belts, gauges, rims and 
steering rods. 40.09 / 4010.22 / 4013.10, 4013.90 / 70.09 / 8301.20 / 
8302.30 / 8421.23 / 8421.31 / 8501.10 / 8511.10 / 
8512.20 / 8512.40 / 8539.10 / 8708.10 / 8708.70 / 
8708.21 / 8708.29 / 8708.91/ 8708.92 / 8708.93 / 8708.94 / 8708.99 / 9026.20 / 9026.80 / 9401.20 
New tyres for passenger automobiles, trucks, buses and multi-purpose vehicles 4011.10 / 4011.20 
Group IV - Chemical 
Engine, transmission, hydraulic, turbine, and 
transformer oils, brake fluid and anti-freeze/ 
coolant 2710.00.52 / 2710.00.53 / 2710.00.54 / 2710.00.55 / 
2710.00.94 /2710.00.95 / 2710.00.96 / 38.19 / 38.20 
Paints All 3208 / All 3209 
Perfumes and cosmetics 3302.90 / All 3303  / All 3304 / All 3305 / All 3306 / 
3307.10 / 3307.20 / 3307.30 / 3307.49.10 / 3307.90.10 / 
3401.1 
Domestic use pesticides and insecticides  3808 
Group V - Others 
Aluminium and aluminium alloy products for architectural application 7604 / 7606 / 7608 / 7609 / 7610 / 7616 
Steel and iron alloy pipes 7304 / 7305 / 7306 / 7307 
Gold and silver jewellery (including gemstones) 7113.11 / 7113.19 / 7113.20 / 7114.11 / 7114.19 / 
7114.20 / 7116.10 / 7116.21 
Head dress for men - cotton shemagh and ghutras  6505.90.10 / 6505.90.30 
Fire extinguishers up to 24kg 8424.10 
Cement 2523.21 / 2523.29.10 / 2523.29.20 
Safety matches 3605.00 
Low pressure regulators and pressure cookers  8481.10 / 7323.93 / 7323.99 
Toilet paper and facial tissues, paper towels and 
serviettes 4818.10 / 4818.20 / 4818.30 
Cigarettes only 2402.20  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 111 
 
 
 Item Harmonised System Commodity Codes 
Household and camping gas appliances, including 
heaters, cookers, barbecues and lamps 7321.11 / 7321.81 / 9405.50 
 WT/ACC/SPEC/SAU/4/Rev.3 
Page 112  
 
 ANNEX J 
Items Subject to Pre-shipment Inspection
 
Item Harmonised System Commodity Codes 
Group I – Toys 
Toys incl.  Video Games and other Electroni c Toys 8712.00 / 9501 / 9502 / 9503 / 9504.10 / 9504.90 / 9505 / 
From 9506.99 / 
Playground, Amusement and Fairground Equipment 9508 / From 3407 / 
Group II - Electrical and Electronics 
Air conditioning systems up to 60,000 btu (5 t ons)  8415.10.20 / 8415.81.20 / 8415.82.20 / 8415.83.20 
Combined function audio and/or video systems (non 
professional) 8518.30 / 8518.50 / 8520.30 /Combinations of II-03, II-04, 
II-41, II-43 
Non professional stand-alone audio products(except radio 
receivers) 8518.21 / 8518.22 / 8518.29 / 8518.40 / 8519.21 / 8519.29 / 
8519.31 / 8519.39 / 8519.92 / 8519.93 / 8519.99 / 8520.20 / 
8520.90 
Video playing and recording systems (non professional)  8521.10 / 8521.90 / 8525.40 /  
Generator sets up to 12 kw  8502.11 / 8502.20  
Motors up to 12kw  8501.10 / 8501.31 / 8501.32 / 8501.40 / 8501.51 / 8501 
Fax and telex machines 8517.21 / 8517.22 
Household cooking appliances  8516.60 / 8516.72 
Clothes washing machines up to 10 kg and household 
dish-washing machines 8450.11 / 8450.12 / 8450.19 / 8422.1 
Clothes drying machines up to 10 kg 8451.21 
Electric irons, ironers and clot hes steamers 8451.30 / 8516.40 / 8516.32 
Domestic electromechanical kitchen appliances incl.  
Food processors, meat choppers and grinders 8509.40 / 8509.80 
Personal care/grooming appliances  (shavers, hair clippers, 
hair-removal devices  and massagers)  8510.10 / 8510.20 / 8510.30 / 9019.10  
Lift and elevator systems 8428.10 / 8431.31 
Household microwave ovens 8516.50 
Electric ovens up to 10 kw  8516.60 
Copy machines and accessories 9009.11 / 9009.12 / 9009.30 / 9009.21 / 9009.22 / 9009.90 
Personal computers (desktops/p ortables), storage units, 
peripherals and other input/output devices 8471.41 / 8471.49 / 8471.50 / 8471.60 / 8471.70 / 8473.30 
Power transformers and distribution transformers up to 
1000 kva 8504.21 / 8504.22 / 8504.31 / 8504.32 / 8504.33 / 8504.34 
Household refrigerators and freezers up to 40 cu ft incl.  
Household refrigerating display cabinets  8418.10 / 8418.21 / 8418.22 / 8418.29 / 8418.30 / 8418.40 / 
8418.50 
Telephone sets, incl. mobile , cordless telephones and 
modems  8517.11 / 8517.19 / 8517.50 / 8525.20  
Electric wires and cables up to 1000v 8544.51 / 8544.59 
Non-industrial vacuum cleaners , water suction appliances 
and shampooers  8509.10 / 8509.80  
Household electric fires and heaters  8516.29 / 8516.21  
Drinking water coolers and fountains 8418.69.10 
Evaporative air coolers (deser t coolers and humidifiers) 
up to 1.5 kw 8415.10.10 / 8415.82.10 / 8415.82.90 / 8415.83.10 / 
8415.83.90 
Domestic electric fans 8414.51 / 8414.60 
Compressors for cooling units up to 60,000 btu 8414.30 
Tea and coffee brewing appliances, and appliances for heating liquids 8516.71 
Incandescent, fluorescent and discharge luminaires, 
fixtures and lampholders 9405.10 / 9405.20 / 8536.61  
Manually operated household sw itches, circuit breakers 
and fuses up to 40a  8536.10 / 8536.20 / 8536.50 
Incandescent, fluorescent and discharge la mps  8539.21 / 8539.22 / 8539.29 / 8539.31 / 8539.32 
Ballasts for discharge type  lamps (including tubular 
fluorescent lamps) 8504.10  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 113 
 
 
 Item Harmonised System Commodity Codes 
Starters for discharge type  lamps (including tubular 
fluorescent lamps)  8532.10 
General use mains plugs, so cket outlets and mains 
configuration adapters  8536.69 
Luminaires for road and street lighting 9405.40 
Batteries, including rechargeable and automotiv e 8506.10 / 8506.30 / 8506.40 / 8506.50/ 8506.60 / 8506.80 / 
8507.10 / 8507.30 / 8507.40 
Immersed swimming pool luminaires 9405.40 8517.21 / 8517.22 
Hair care equipment (hand-held hair dryers, hair curlers, 
waving apparatus and curling tong heaters)  8516.31, 8516.32 
Water pumps up to 12 kw 8413.70 
TV sets (colour/black and white) 8528.12 / 8528.13 
General use mains voltage c onverters, power supplies and 
battery chargers  8504.40  
Stand alone radio receivers 8527.12 / 8527.13 / 8527.19 / 8527.21 / 8527.29 
Storage and instant type water heaters up to 200 litres 8516.10 
Watt hour meters 9028.30 
Household sewing machines  8452.10  
Group III - Automotive 
Passenger automobiles, truc ks, buses and multi-purpose 
vehicles (new) 8701 / 8702 / 8703 / 8704 / 8705 
Passenger automobiles, truc ks, buses and multi-purpose 
vehicles (used) 8701 / 8702 / 8703 / 8704 / 8705 
Automotive glass (windshield, side and rear glass) 7007.21 
Vehicle spare parts (new), in cluding radiators and hoses, 
brakes and parts, lights, filters, silencers and exhaust 
pipes, clutches and parts, child restraints, spark plugs, 
wiper blades and motors, safety belts, fuel tanks, mirrors, bumpers, door locks and hinges, tire tubes, and v-belts, 
gauges, rims and steering rods 40.09 / 4010.22 / 4013.10, 4013.90 / 70.09 / 8301.20 / 
8302.30 / 8421.23 / 8421.31 / 8501.10 / 8511.10 / 8512.20 / 
8512.40 / 8539.10 / 8708.10 / 8708.70 / 8708.21 / 8708.29 / 
8708.91/ 8708.92 / 8708.93 / 8708.94 / 8708.99 / 9026.20 / 9026.80 / 9401.20 
New tyres for passenger autom obiles, trucks, buses and 
multi-purpose vehicles 4011.10 / 4011.20 
Group IV - Chemical 
Engine, transmission, hydrauli c, turbine, and transformer 
oils, brake fluid and anti-freeze/ coolant 2710.00.52 / 2710.00.53 / 2710.00.54 / 2710.00.55 / 
2710.00.94 /2710.00.95 / 2710.00.96 / 38.19 / 38.20 
Paints All 3208 / All 3209 
Perfumes and cosmetics 3302.90 / All 3303 / All 3304 / All 3305 / All 3306 / 3307.10 
/ 3307.20 / 3307.30 / 3307.49.10 / 3307.90.10 / 3401.1 
Domestic use pesticides  and insecticides  3808 
Group V- Others 
Aluminium and aluminium alloy products for 
architectural application 7604 / 7606 / 7608 / 7609 / 7610 / 7616 
Steel and iron alloy pipes 7304 / 7305 / 7306 / 7307 
Gold and silver jewellery (including gemstone s) 7113.11 / 7113.19 / 7113.20 / 7114.11 / 7114.19 / 7114.20 / 
7116.10 / 7116.21 
Head dress for men - cotton shema gh and ghutras  6505.90.10 / 6505.90.30 
Fire extinguishers up to 24kg 8424.10 
Cement 2523.21 / 2523. 29.10 / 2523.29.20 
Safety matches 3605.00 
Low pressure regulators, and pressu re cookers  8481.10 / 7323.93 / 7323.99 
Toilet paper and facial tissues, paper towels, and 
serviettes 4818.10 / 4818.20 / 4818.30 
Cigarettes only 2402.20 
Household and camping gas appl iances, including heaters, 
cookers, barbecues, and lamps 7321.11 / 7321.81 / 9405.50 
 WT/ACC/SPEC/SAU/4/Rev.3 
Page 114  
 
 APPENDIX 
DRAFT DECISION 
ACCESSION OF THE KINGDOM OF SAUDI ARABIA 
Decision of [...] 
The General Council, 
 Having regard to paragraph 2 of Article XII a nd paragraph 1 of Article IX of the Marrakesh 
Agreement Establishing the World Trade Organiza tion (the "WTO Agreement"), and the Decision-
Making Procedures under Articles IX and XII of th e WTO Agreement agreed by the General Council 
(WT/L/93), 
 Conducting the functions of the General Council in  the interval between meetings pursuant to 
paragraph 2 of Article IV of the WTO Agreement, 
 Taking note of the application of the Kingdom of Saudi Arabia for accession to WTO 
Agreement dated "date", 
 Noting the results of the negotiations direct ed toward the establishment of the terms of 
accession of the Kingdom of Saudi Arabia to the WTO Agreement and having prepared a Protocol on the Accession of the Kingdom of Saudi Arabia, 
 Decides as follows: 1.  The Kingdom of Saudi Arabia may accede to the WTO Agreement on the terms and 
conditions set out in the Protoc ol annexed to this Decision. 
_______________  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 115 
 
 
 DRAFT PROTOCOL 
ON THE ACCESSION OF THE KINGDOM OF SAUDI ARABIA 
Preamble  
 The World Trade Organization (hereinafter referred to as the "WTO"), pursuant to the 
approval of the General Council of the WTO accorded under Article XII of  the Marrakesh Agreement 
Establishing the World Trade Organization (hereinaft er referred to as the "WTO Agreement"), and the 
Kingdom of Saudi Arabia,  
 Taking note of the Report of the Working Party on the Accession of the Kingdom of Saudi 
Arabia to the WTO Agreement reproduced in doc ument WT/ACC/SAU[...], dated [...] (hereinafter 
referred to as the "Working Party Report"), 
 Having regard to the results of the negotiations on the accession of the Kingdom of Saudi 
Arabia to the WTO Agreement,  
 Agree as follows: PART I - GENERAL 1.  Upon entry into force of this Protocol pursu ant to paragraph 8, the Kingdom of Saudi Arabia 
accedes to the WTO Agreement pursuan t to Article XII of that Agreement and thereby becomes a 
Member of the WTO.  
2.  The WTO Agreement to which the Kingdom  of Saudi Arabia accedes shall be the WTO 
Agreement, including the Explanatory Notes to that  Agreement, as rectified, amended or otherwise 
modified by such legal instruments as may have entere d into force before the date of entry into force 
of this Protocol. This Protocol, which shall include  the commitments referred to in paragraph [...] of 
the Working Party Report, shall be an integral part of the WTO Agreement. 
3.  Except as otherwise provided for in paragr aph [...] of the Working Party Report, those 
obligations in the Multilateral Trade Agreements annexed to the WTO Agreement that are to be 
implemented over a period of time starting with the entry into force of that Agreement shall be 
implemented by the Kingdom of Saudi Arabia as if it had accepted that Agreement on the date of its entry into force. 
4.  The Kingdom of Saudi Arabia may maintain a measure inconsistent with paragraph 1 of 
Article II of the GATS provided that such a measure was recorded in the list of Article II Exemptions 
annexed to this Protocol and meets the cond itions of the Annex to the GATS on Article II 
Exemptions. 
PART II - SCHEDULES 5.  The Schedules reproduced in Annex I to th is Protocol shall become the Schedule of 
Concessions and Commitments annexed to the General Agreement on Tariffs and Trade 1994 
(hereinafter referred to as the "GATT 1994") and th e Schedule of Specific Commitments annexed to 
the General Agreement on Trade in Services (herei nafter referred to as "GATS") relating to the 
Kingdom of Saudi Arabia. The staging of the c oncessions and commitments listed in the Schedules 
shall be implemented as specified in the re levant parts of the respective Schedules. WT/ACC/SPEC/SAU/4/Rev.3 
Page 116  
 
 6.  For the purpose of the reference in paragra ph 6(a) of Article II of the GATT 1994 to the date 
of that Agreement, the applicable date in resp ect of the Schedules of Concessions and Commitments 
annexed to this Protocol shall be the date  of entry into force of this Protocol. 
PART III - FINAL PROVISIONS 7.  This Protocol shall be open for acceptance, by signature or otherwise, by the Kingdom of 
Saudi Arabia until [...]. 
8.  This Protocol shall enter into force on th e thirtieth day following the day upon which it shall 
have been accepted by the Kingdom of Saudi Arabia.  
9.  This Protocol shall be deposited with the Di rector-General of the WTO. The Director-General 
of the WTO shall promptly furnish a certified copy of this Protocol and a notification of acceptance 
by the Kingdom of Saudi Arabia thereto pursuant to  paragraph 9 to each Member of the WTO and to 
the Kingdom of Saudi Arabia.  
  This Protocol shall be registered in accord ance with the provisions of Article 102 of the 
Charter of the United Nations.  
 Done at [place] this [date of month in full] day of [month and year in full] in a single copy in 
the English, French and Spanish languages, each te xt being authentic, except that a Schedule annexed 
hereto may specify that it is authentic in only one of these languages. 
_______________ 
  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 117 
 
 
 ANNEX I 
SCHEDULE [...] - THE KINGDOM OF SAUDI ARABIA 
Authentic only in the ...  language. 
(Circulated in document WT/ACC/SAU/[...]/Add.1) 
_______________ 
SCHEDULE OF SPECIFIC COMMITMENTS ON SERVICES 
LIST OF ARTICLE II EXEMPTIONS 
Authentic only in the ...  language. 
(Circulated in document WT/ACC/SAU/[...]/Add.2) ] 
__________ WT/ACC/SPEC/SAU/4/Rev.3 
Page 118  
 
 APPENDIX
 
Questionnaire  
Information On Import Licensing Procedures  
I. OUTLINE OF SYSTEMS 
1. The Kingdom of Saudi Arabia maintains a non-automatic licensing system that is 
administered in accordance with the provisions of the new Law on Import Licensing Procedures, issued by Council of Ministers Decision No. 88, dated 6.4.1423H (June 2002). 
II. PURPOSES AND COVERAGE OF LICENSING 
1. Identify each licensing system maintained and state what products, appropriately grouped, are 
covered. 
 Ans: A list of items subject to non-automatic li censing is attached to the Working Party 
Report as Annex E. 
2. The system applies to goods origin ating in and coming from which countries? 
 Ans: The system applies to goods originating in and coming from all countries. 
3. Is the licensing intended to restrict the quantit y or value of imports, and if not, what are its 
purposes?  Have alternative methods of accomplis hing the purposes been considered and if so 
which?  Why have they not been adopted? 
 Ans: No, the licensing is not intended to restrict the quantity or value of imports.  The 
purpose of licensing is to ensure that goods that  do not meet the requirements of different 
laws, regulations or decisions are not impor ted.  Alternative methods have not been 
considered. 
4. Cite the law, regulation and/or administrativ e order under which the licensing is maintained.  
Is the licensing statutorily required?  Does the legislation leave designation of products to be subjected to licensing to administrative discreti on?  Is it possible for the government (or the 
executive branch) to abolish the system without legislative approval? 
 Ans: Licensing is maintained under Decision No . 88 of the Council of Ministers, dated 
6.4.1423H (June 2002).  The list of items subj ect to licensing requirements may be amended 
by the Minister of Commerce and Industry on th e basis of comments received from respective 
government agencies.  The system can only be  abolished by a decision of the Council of 
Ministers.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 119 
 
 
 III. PROCEDURES 
1. For products under restriction as to the quan tity or value of imports (whether applicable 
globally or to a limited number of countries or whether established bilaterally or unilaterally): 
(a to k) 
 Ans: There are no restrictions on the quantity or value of imports ((a) to (k) are thus not 
applicable). 
2. Where there is no quantitative limit on impor tation of a product or on imports from a 
particular country: 
(a) How far in advance of importation must  application for a license be made?  Can 
licenses be obtained within a shorter tim e-limit or for goods arriving at the port 
without a license (for example, owing to inadvertency)? 
 Ans: Applications for non-automatic licenses may be  submitted within 21 days prior to the 
closing date of applications. 
(b) Can a license be granted immediately on request? 
 Ans: The maximum period for deciding on license applications is 30 days.  However, in 
practice, licenses normally are granted in a shorter period. 
(c) Are there any limitations as to the period of the year during which application for 
license and/or importation may be made?  If so, explain. 
 Ans: There are no limitations as to the period of the year during which applications or 
importation may be made. 
(d) Is consideration of license applications e ffected by a single administrative organ?  Or 
must the application be passed on to other organs for visa, note or approval?  If so, which?  Does the importer have to appro ach more than one administrative organ? 
 Ans: Yes, by a single administrative body.  In some cases, the body may coordinate with 
other bodies, but the applicant does not have to approach more than one administrative body. 
3. Under what circumstances may an application for a license be refused other than failure to 
meet the ordinary criteria?  Are the reasons for any refusal given to the applicant?  Have applicants a right of appeal in the event of refu sal to issue a license and,  if so, to what bodies 
and under what procedures? 
 Ans: Applications are not refused other than for reasons of failure to meet the ordinary 
criteria.  Reasons for refusal of a license are given upon request of the applicant.  Applicants 
have a right of appeal in the event of refusal of a license.  The initial appeal can be made to 
the Head of the administrative body within 15 da ys of the decision.  An appeal against the 
decision of the Head of the administrative bod y lies to the Board of Grievances within 30 
days of the decision. WT/ACC/SPEC/SAU/4/Rev.3 
Page 120  
 
 IV. ELIGIBILITY OF IMPORTS TO APPLY FOR LICENSE 
1. Are all persons, firms and institu tions eligible to apply for licenses: 
(a) under restrictive licensing systems? (b) under non-restrictive systems? 
 If not, is there a system of registration of pers ons or firms permitted to engage in importation?  
What persons or firms are eligible?  Is there a registration fee?  Is there a published list of 
authorized importers? 
 Ans: Eligibility of parties under restrictive and under non-restrictive licensing systems is the 
same.  The eligible categories are as follows: 
(i) Saudi, foreign or joint venture compani es registered under applicable Saudi laws. 
(ii) Natural persons listed in the Commercial Register. 
(iii) Saudi nationals and non-Saudis holding resi dence permits but not registered in the 
Commercial Register provided the importe d goods are for their personal use. 
 Imports by parties in (i) and (ii) above shall be limited to goods relate d to the scope of their 
business as inscribed in the Commercial Register. 
VI. DOCUMENTATION AND OTHER REQUIREMENTS FOR APPLICATION FOR 
LICENSE 
1. What information is required in applications?  Submit a sample  form.  What documents is the 
importer required to supply with the application? 
 Ans: The applicant has to provide description of the item/s, their value and weight, and copies 
of the invoice and the bill of lading. 
2. What documents are required upon actual importation? 
 Ans: Documents required are: the import license, or iginal invoice and certificate of origin.  
The last two are requirements for customs clearance and not requirements of the licensing system. 
3. Is there any licensing fee or administrative ch arge?  If so, what is the amount of the fee or 
charge? 
 Ans: There are no licensing fees or administrative charges. 
4. Is there any deposit or advance payment require ment associated with the issue of licenses?  If 
so, state the amount or rate, whether it is ref undable, the period of retention and the purpose 
of the requirement. 
 Ans: There are no deposit or advance payment requirements associated with the issue of a 
license.  WT/ACC/SPEC/SAU/4/Rev.3 
 Page 121 
 
 
 VII. CONDITIONS OF LICENSING 
1. What is the period of validity of a license?  Ca n the validity of a license be extended?  How?   
 Ans: The period of validity of a license is one year  from the date of issue.  Extension may be 
granted if it is in the public interest. 
2. Is there any penalty for the non-utilization of a license or a portion of a license?  Ans: There is no penalty for non-utilization of a license or portion of a license. 
3. Are licenses transferable between importers?  If so, are any limitations or conditions attached 
to such transfer? 
 Ans: Licenses are not transferable between importers. 
4. Are any other conditions attached to the issue of a license: 
(a) for products subject to quantitative restriction? (b) for products not subject to quantitative restriction? 
 Ans: No other conditions are attached. 
VIII. OTHER PROCEDURAL REQUIREMENTS 
1. Are there any other administrative procedures, apart from import licensing and similar 
administrative procedures, required prior to importation? 
 Ans: There are no other administrative procedures. 
2. Is foreign exchange automatically provi ded by the banking authorities for goods to be 
imported?  Is a license required as a condition to  obtaining foreign exchange?  Is foreign 
exchange always available to cover licenses i ssued?  What formalities must be fulfilled for 
obtaining the foreign exchange? 
 Ans: There are no foreign exchange restric tions or controls in Saudi Arabia. 
 
__________