In an attempt to create a more business-friendly environment, Saudi Arabia immigration policies have recently experienced dramatic changes. It is important to understand recent changes in Saudi Arabia’s immigration policy, including the effect on work visa requirements and how these changes may affect your business.
Understanding these important changes can help you better prepare for the future of your business.
Major Changes to Saudi Arabia Immigration Policy
Saudi Arabia’s immigration policy has experienced a number of dramatic changes over the last few months and continues to evolve.
The most major change is to the Nitaqat program. Nitaqat is Saudi Arabia’s official nationalization program.
Saudi Arabian government officials want to make sure that local residents have the best advantages for employment in the country. This program provides nationalization targets that are different for different industries.
When adequate numbers of skilled Saudi nationals are available to fill these positions, the target for that industry is increased.
Additionally, certain job fields have been provided with targets by the Ministry of Labor and Social Development. This government agency has tried to balance efforts to balance nationalization while also promoting foreign investment.
Recent changes to the localization requirements have eased some regulations pertaining to immigration and labor standards.
Companies have been given additional incentives to encourage foreign talent. Some of these new policies have effectively reversed policies in 2017 and 2018 that aggressively required localization.
Saudi Arabia recently appointed a new Ministry of Labour, who has an extensive background in business. This appointment signals the country’s desire to have a thriving private-sector that aligns with Vision 2030.
List of Major Saudi Arabia Immigration Policy Changes
Major changes to this system include the following:
- Easing foreign national quotas – Approved quota requirements have been increased to two years. There is currently a suspension of labor market testing for every quota application. Additionally, there are relaxed quota requirements based on changes in the employee structure due to departing foreign workers.
- Reducing quotas in certain sectors – Certain sectors are required to maintain a much smaller quota of local resident employees. IT sectors are decreased from 49% to 39%. Banking and finance are reduced from 82% to 65%. Oil and gas sector requirements are reduced from 66% to 46%. New Saudi employees are counted immediately for the purposes of quota calculations, instead of from an average of 26 weeks.
- Easing financial burdens – Expats from certain green employers can receive reimbursement and exemption. Additional reviews of expat and dependent levies will be completed. Bilateral agreements can reduce the cost of visitor visa fees.
- Increasing flexibility for travel – Another Saudi Arabia immigration policy that has been adjusted is the granting of longer validity for visas. South Korean, Japan, French, UK and U.S. nationals can receive a visa from three to five years. Tourist visas are also being issued for entertainment, tourism and hospitality sectors.
Potential Implications of Changes to Saudi Arabia Immigration Policies
The recently enacted changes have had a positive effect on human resources and growth in Saudi Arabia. The new policies have led to shorter processing time to onboard foreign talent because of the lower quota requirements and because the labor market test is suspended.
Human resources departments are amending their job titles when employees’ roles and responsibilities change to take advantage of the looser requirements. The changes are also expected to provide the government with the most recent and accurate data regarding workplaces in Saudi Arabia.
Because of the possibility of reimbursement and waiver of the expat levy, more foreign nationals are able to take advantage of the opportunity to travel and do business in Saudi Arabi.
Companies that have high numbers of foreign national employees stand to gain the most because of this important change.
Companies further benefit by not having to apply for a block visa quota once a foreign worker leaves, The new policies allow a company to fill the role immediately with another qualified candidate.
How to Incorporate New Changes
Businesses must be thoughtful in how they incorporate these new changes into their existing policies. They must plan and implement internal review procedures to make sure that they are taking advantage of the latest changes and relaxing of quotas.
Conscientious businesses will want to ensure they are compliant with local labor and immigration rules.
Businesses should set up a consistent process to obtain a monthly nationalization report and track the expiry of any approved block visa they have.
They should also set up a process so that when a foreign worker leaves the company that another employee can seamlessly be transitioned into their position.
They should review their eligibility and pursue reimbursement for their levies and ensure that they do not pay new levies. They should make amendments to job titles based on changes. They may also wish to revise employment contracts and policies to adapt to the new measures.
Working with a local immigration expert company like New Horizons and use a solution such a PEO for Saudi Arabia can also provide up-to-date advice in these matters.