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Saudi Gazette publishes full text of new foreign property ownership law The law grants non-Saudis broader real estate rights under defined conditions while imposing restrictions in Makkah and Madinah
RIYADH — Saudi Gazette has obtained an official copy of Saudi Arabia's "Non-Saudi Real Estate Ownership Law" and is publishing the complete English text of its 15 articles below. The law consists of 15 articles and will come into force 180 days after its publication. The new framework allows non-Saudis — including individuals, companies, and non-profit entities — to own or acquire rights to real estate within geographic areas to be designated by the Council of Ministers. It introduces provisions for foreign companies, investment funds, and special-purpose entities to own property across the Kingdom, including Makkah and Madinah, under strict conditions. While the law grants wider ownership rights, it places restrictions on sensitive locations, limiting property ownership in Makkah and Madinah to Muslim individuals. It also mandates registration with the competent authorities, introduces a fee of up to 5 percent on disposals, and sets penalties of up to SR10 million or forced sale of property in case of violations. The legislation replaces the previous 2000 law and establishes a comprehensive, transparent system to regulate foreign ownership of real estate in the Kingdom. To read the full text of the law, here are the articles in detail: Article 1 — Definitions For the purposes of this Law, the following terms shall have the meanings assigned to them: * Law: The Non-Saudi Real Estate Ownership Law. * Regulations: The implementing regulations of the Law. * Authority: The Real Estate General Authority. * Non-Saudi: 1. A natural person who does not hold Saudi nationality. 2. A non-Saudi company. 3. A non-Saudi non-profit entity. 4. Any other non-Saudi legal person designated by decision of the Council of Ministers. Article 2 — General ownership provisions 1. A non-Saudi may own real estate or acquire other real rights in real estate within geographic areas to be defined under Paragraph (2) of this Article. 2. By decision of the Council of Ministers — based on a proposal from the Authority's Board of Directors and approval of the Council of Economic and Development Affairs — the following shall be determined: a. The geographic zones where non-Saudis may own or acquire real rights. b. The types of real rights non-Saudis may acquire. c. The maximum percentage of ownership permitted to non-Saudis within such zones. d. The maximum duration for usufruct rights for non-Saudis. e. Any controls related to non-Saudi ownership or acquisition of real rights. 3. In addition to the rights set out in Paragraphs (1) and (2), a natural person legally residing in the Kingdom may own one residential property outside the designated zones, except in Makkah and Madinah. The Regulations shall set the provisions of this Paragraph. 4. In Makkah and Madinah, non-Saudi ownership or acquisition of real rights shall be limited to natural persons who are Muslims. Article 3 — Non-listed foreign companies 1. A non-listed company incorporated under Saudi law with one or more foreign shareholders may own or acquire real rights in property within the zones defined under Article 2(2), including in Makkah and Madinah. 2. Subject to Paragraph (1) and other applicable laws, such companies may also acquire property or rights needed for their activities or for staff housing inside or outside the designated zones, in accordance with the Regulations. Article 4 — Listed companies and funds Listed companies, investment funds, and special-purpose entities licensed under Saudi law may own or acquire real rights in property across the Kingdom — including in Makkah and Madinah — in accordance with the Capital Market Law, its implementing regulations, and controls established by the Capital Market Authority in coordination with the Real Estate General Authority and other relevant bodies. Article 5 — Relation with other laws This Law shall not prejudice the application of the Premium Residency Law, the GCC nationals' reciprocal property ownership framework, or any other laws granting more favorable rights to non-Saudis. Article 6 — Scope of rights Ownership or acquisition of real rights by a non-Saudi does not confer any privileges beyond those prescribed by law for the holder of such rights. Article 7 — Diplomatic and international entities Subject to reciprocity, accredited diplomatic missions in the Kingdom may own official premises and residences for heads of mission and staff. International and regional organizations may own their official premises as permitted under their governing treaties, subject to approval from the Ministry of Foreign Affairs. Article 8 — Registration requirements 1. Non-Saudi companies, non-profit entities, or other legal persons designated by the Council of Ministers must register with the competent authority before acquiring property or real rights in the Kingdom, in accordance with the Regulations. 2. Non-Saudi ownership or acquisition of real rights shall only be valid upon registration with the Real Estate Register in accordance with applicable laws. Article 9 — Fees Without prejudice to existing taxes or fees, the Authority shall levy a fee not exceeding 5% of the value of any disposal by a non-Saudi of real rights in property in the Kingdom. Article 10 — Penalties 1. Without prejudice to harsher penalties under other laws, any violation of this Law or its Regulations shall result in one or more of the following: a. A warning. b. A fine not exceeding 5% of the value of the real right concerned, capped at SR10,000,000. 2. The Regulations shall include a schedule of violations and corresponding penalties, taking into account the seriousness, circumstances, and effects of the violation. Article 11 — Committees 1. One or more committees of at least three legal specialists shall be formed by decision of the Authority's Board to examine violations and impose penalties under Article 10. 2. The Authority's Board shall set the rules, procedures, and compensation for committee members. 3. Committee decisions may be appealed before the Administrative Court within 60 days of notification. Article 12 — False information 1. Without prejudice to harsher penalties under other laws, a non-Saudi who knowingly provides false or misleading information to acquire property or rights under this Law shall be subject to: a. A fine not exceeding 5% of the value of the real right concerned, capped at SR10,000,000. b. Forced sale of the real right. 2. The Public Prosecution shall investigate and prosecute such violations, with jurisdiction resting in the competent court. 3. Where a court orders the sale of a real right, the violator shall be refunded either the purchase price or the sale proceeds, whichever is less, after deducting fines, taxes, fees, and sale expenses. Any surplus shall be paid to the State Treasury. Article 13 — Regulations 1. The Regulations shall be issued by the Council of Ministers within 180 days of publication, based on a proposal by the Authority's Board and approval of the Council of Economic and Development Affairs, and shall take effect upon enforcement of this Law. 2. The Regulations shall determine: a. Procedures for non-Saudis acquiring real rights in property. b. Requirements for enforcing this Law on non-Saudis not residing in the Kingdom. c. The applicable fee under Article 9, based on property type, purpose, and location. d. Transactions subject to a zero percent fee and related conditions. Article 14 — Repeal of previous law This Law repeals the "Non-Saudi Real Estate Ownership and Investment Law" issued by Royal Decree No. (M/15) dated 17/4/1421H, and annuls any conflicting provisions. Article 15 — Entry into force This Law shall take effect 180 days after its publication in the official gazette.
