• 1- The following words and phrases shall have the meanings specified next to each of them, unless the context of the text requires otherwise:

  • (a) The Authority: Zakat, Tax, and Customs Authority.

  • (b) Arrangements and Procedures: Arrangements and procedures for implementing the provisions of the regulation concerning the treatment of non-disclosure of information for tax purposes in accordance with the provisions of the agreements to which the Kingdom of Saudi Arabia is a party.

  • (c) Common Reporting Standard: It shall have the meaning contained in the multilateral agreement between the competent authorities regarding the automatic exchange of financial account information ratified by Royal Decree No. (M/125) dated 1/12/1438 AH.

  • (d) FATCA: The agreement concluded between the Government of the Kingdom of Saudi Arabia and the Government of the United States of America to improve international tax compliance and implement the Foreign Account Tax Compliance Act ratified by Royal Decree No. (M/52) dated 10/5/1438 AH.

  • (e) Reporting Financial Institution: Any financial institution in the Kingdom of Saudi Arabia that is not classified as a non-reporting financial institution, and these institutions are specified in more detail by referring to the Common Reporting Standard and/or FATCA as applicable.

• 2- Except as provided in the first paragraph of this article, the words and phrases contained in these arrangements and procedures shall have the meanings defined in the FATCA agreement or the Common Reporting Standard as applicable.

The purpose of these arrangements and procedures is as follows:
1- To ensure that the reporting financial institutions effectively implement the Common Reporting Standard and/or FATCA.
2- To monitor the compliance of the reporting financial institutions on an annual basis.
3- To clarify the violations and financial penalties applicable to the reporting financial institutions.

The provisions of these arrangements and procedures apply to all persons subject to the regulations regarding the handling of non-disclosure of information for tax purposes in accordance with the provisions of the agreements to which the Kingdom of Saudi Arabia is a party, issued by Council of Ministers Resolution No. (706) dated 30/11/1438 AH.

• 1- All reporting financial institutions must conduct an annual review and issue an attesting certificate that specifies

• whether the reporting financial institution is effectively applying and complying with the Common Reporting Standard and/or FATCA as required.

• 2- The review process includes, but is not limited to, the following:

  • (a) Ensuring the entity in question is classified as a reporting financial institution.

  • (b) Ensuring that the reporting financial institution has implemented appropriate internal systems and procedures to enable compliance with the provisions.

  • (c) Conducting a sample test regarding new accounts, existing accounts, reported accounts, and unreported accounts.

• 3- The reporting financial institution must submit the results of the review certificate to the authority before August 1 of each year, and this certificate must be sent to the email address of the team responsible for information exchange at the authority as follows:

  • (a) Regarding the Common Reporting Standard: ([email protected]).

  • (b) Regarding FATCA: ([email protected]).

• 4- The reporting financial institution must submit a separate review certificate for both the Common Reporting Standard and FATCA.

• 1- The Authority has the right to conduct review operations and/or request the reporting financial institution to provide information to determine its compliance with the Common Reporting Standard and/or FATCA as required.

• 2- The Authority shall notify the reporting financial institution in writing of its intention to conduct a review and specify the information required for the review at least twenty (20) days prior to its execution.

• 3- Notwithstanding the second paragraph of this article, the Authority reserves the right to conduct a review without prior notice in the following cases:

  • (a) Cases involving suspicion of actions leading to non-compliance.

  • (b) Cases where the reporting financial institution has already refused to cooperate with the Authority.

  • (c) Cases where prior notice to the reporting financial institution may lead to the destruction of evidence.

• 4- The reporting financial institutions must cooperate with the Authority and provide all records, documents, information, and explanations as requested during the review operations conducted by the Authority, whether inside the premises of the reporting financial institution or outside.

1- If it is determined that the reporting financial institution has committed a violation, the authority shall notify it of the occurrence of the violation through the approved communication channels, along with a statement of the specific details related to the violation and the imposed fine.
2- The reporting financial institution is obligated to pay the amount of the fine within (60) days from the date it is notified of the decision.
3- The fines mentioned in these arrangements and procedures shall be collected in accordance with the procedures outlined in the relevant regulations, rules, and instructions in the Kingdom.

The notifying financial institution has the right to object to the fine imposed on it before the competent judicial authority in accordance with the applicable laws, regulations, and instructions in the Kingdom.

The amounts of fines that have been paid by the notifying financial institution shall be refunded in the event of a final judgment in its favor, in accordance with the provisions of the relevant laws, regulations, and instructions in force in the Kingdom.

The Authority is responsible for managing and implementing what is stated in these arrangements and procedures, as well as reviewing violations and imposing fines issued by a decision from the Minister of Finance.