Riyadh’s investment law reforms tipped to win over sceptics

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• Aims to attract investors
• ‘More secure environment’
• Pro League clubs among targets

Saudi Arabia’s investment law reforms are poised to release a backlog of pent-up deals – and are a tacit admission that procedures have often been cumbersome, analysts have told AGBI.

Under the overhaul announced on Sunday, elements of Vision 2030 and the National Investment Strategy will be combined in a single framework that aims to channel more private capital into giga-projects.

The changes include guarantees of equal treatment and opportunities for foreign investors, streamlined licensing requirements and clear dispute resolution mechanisms.

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Rana Maristani, CEO of R Consultancy Group, which helps UK businesses expand into the UAE and Saudi Arabia, says investors previously had to grapple with regulatory ambiguity and procedural complexity. 

“Some deals fell through due to the lengthy and unclear licensing process, causing delays and uncertainties.” The update in January 2025 will consolidate various investor rights and procedural reforms, she says, and should ensure a “more predictable and secure environment for both local and foreign investors”. 

It is also designed to demonstrate Saudi Arabia’s readiness to build a transparent market and reassure sceptics, Maristani says.

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Mohammad Alshammari, a senior lawyer at JS Law Firm in Jeddah, says the reforms offer greater opportunities to international investors.

Previously, he says, they “encountered challenges such as restrictions on certain activities for foreign investors and delays in transferring funds out of the kingdom”. 

The updated laws allow unrestricted investment in available sectors and aim to ensure the free and timely transfer of funds. 

Spotlight on sports

Alshammari says the reforms should be particularly useful for funders interested in Saudi Arabia’s emerging sports sector.

“The new investment law is part of several recently issued laws aimed at strengthening the investment infrastructure, including the privatisation law,” he says. 

Saudi Pro League football clubs such as Al Hilal and Al Nassr “have already been transferred to private ownership”, he points out. “Currently, the Ministry of Sports has offered six clubs for privatisation for both local and international investors.”

Saudi Arabia’s sports sector is organised into 88 investment tracks ranging from sports education to medicine and manufacturing. Basim Ibrahim, director of sport investment development at Saudi’s Ministry of Investment, told AGBI last month that the kingdom is also preparing to sell stadium naming rights.  

Maristani is anticipating a swift increase in foreign direct investment in technology, infrastructure and renewable energy.

“These sectors are poised to benefit first due to the streamlined processes and incentives provided under the new law,” she says.

Ali Janoudi, head of new markets at private bank Lombard Odier, describes the reforms as “one of the important items on the government’s economic agenda”.

Victor Fraile/Power Sport Images via Alamy

“To attract significant FDI flows, as well as foreign investors generally, investment laws need to be comparable to the highest global standards,” he says. 

“International investors have the advantage of investing globally, so the natural tendency is to benchmark ease of doing business in one economy versus another.”

Janoudi says the changes are also a positive development for regional entrepreneurs. “For them, having more domestic competition will lead to innovation.”

Saudi Arabia has introduced laws covering civil transactions, private sector participation, companies and bankruptcy in recent years, as well as setting up special economic zones.

These measures have led to an increase in FDI, although it remains below the 2030 target of $100 billion a year.

Alshammari says: “The new investment law and other recent reforms send a clear message to global investors: Saudi Arabia is committed to fostering a fair, transparent and attractive investment environment.”