• Any public entity - including entities authorized to establish companies or participate in their establishment - that aims to establish a company or participate in its establishment, or own an existing company or purchase shares or stocks therein, or aims to establish an entity whose purposes include investment or any profit-oriented activity, or aims to amend the statute of a subsidiary entity to enable it to invest or be profit-oriented, shall follow the following steps:

  • 1- Address the Public Investment Fund to consider whether the establishment of the company, participation in its establishment, ownership of an existing company, purchase of shares or stocks therein, establishment of an entity whose purposes include investment or any profit-oriented activity, or amendment of the statute of a subsidiary entity to enable it to invest or be profit-oriented; should be done through the Fund.

  • 2- Upon receipt of the entity's letter by the Fund, the Fund must respond within a period not exceeding (90) days from the date of completion of the necessary information and requirements.

  • 3- If the Fund deems the entity's request inappropriate, and the entity still sees the need to establish that company, participate in its establishment, own it, purchase shares or stocks therein, or establish the entity or amend the statute of its subsidiary entity to enable it to invest or be profit-oriented; the entity shall refer its request - accompanied by the Fund's response regarding the inappropriateness of the request - to the Ministry of Finance.

  • 4- The Ministry of Finance - in cooperation with the entity - shall study the request and take what they deem appropriate regarding it, in accordance with the governance referred to in paragraph (1) of clause (Eighth) of these rules, within a period not exceeding (90) days from the date the Ministry receives the request.

  • 5- If no agreement is reached between the Ministry of Finance and the requesting entity, and the entity still considers the need to establish a company, participate in its establishment, own an existing company, purchase shares or stocks therein, or the need to establish an entity whose purposes include investment or any profit-oriented activity, or amend the statute of a subsidiary entity to enable it to invest or be profit-oriented; the entity may submit a request to the Royal Court clarifying that need and its justifications, along with the opinions of the Ministry of Finance and the Public Investment Fund regarding this request, for consideration and for the Royal Court to take what it deems appropriate in this regard.

• The provisions contained in paragraph (First) of these rules shall not apply to the following:

  • 1- The General Organization for Social Insurance, the Saudi Central Bank (SAMA), the National Center for Privatization, the National Development Fund and its affiliated developmental funds and banks, and any companies owned by any of them, whether fully or partially owning shares or stocks therein.
  • 2- Companies or entities established in accordance with the provisions of the State General Budget Decree.
  • 3- The General Authority for Awqaf, and the General Commission for the Guardianship of Trust Funds for Minors and their Counterparts, if either of them establishes a company, participates in its establishment, owns a company, or purchases shares or stocks therein, or if it establishes an entity whose purposes include investment or any profit-oriented activity, or amends the statute of an affiliated entity to enable it to invest or to be profit-oriented; excluding funds provided to them by the state in any form.

The Ministry of Commerce and the Capital Market Authority - each within its jurisdiction - shall not take any action regarding the establishment of any new company, or the registration of any transfer of ownership of shares or stocks in existing companies for any public entity; except in accordance with the provisions contained in clauses (First) and (Second) of these rules.

Public authorities - except for the authorities stipulated in item (Second) of these rules - shall submit to the Supreme Authority; to complete what is necessary regarding the provisions established by law, including related orders and decisions, which authorize any of those authorities to establish companies, participate in their establishment, own existing companies, purchase shares or stocks in them, or have the authority to establish an entity whose purposes include investment or any profit-oriented activity, or to amend the statute of a subsidiary entity enabling it to invest or be profit-oriented; in accordance with what is stated in these rules.

1- The Public Investment Fund shall submit to the Royal Court - within a period not exceeding (180) days from the date of completion of the information referred to in paragraph (Fifth) of these rules - regarding the appropriateness of transferring the ownership of the company or its shares or stocks, or transferring the entity whose purposes include investment or any profit-oriented activity from the public entity to the Fund, provided that the submission includes the views of the public entity in this regard.

2- In case the Public Investment Fund deems the transfer inappropriate; the matter shall be referred to the Ministry of Finance to study it with that entity to take the necessary action - within a period not exceeding (90) days from the date of referral to the Ministry - in accordance with the governance referred to in paragraph (1) of clause (Eighth) of these rules.

In the event that the Public Investment Fund agrees to transfer ownership of the company or ownership of its shares or stocks, or to transfer the entity whose purposes include investment or any profit-oriented activity to it, in accordance with the provisions contained in clause (Sixth) of these rules, this shall be for a monetary amount or any other consideration or any other arrangements. Its valuation and repayment mechanism shall be as agreed upon between the Minister of Finance and the Governor of the Public Investment Fund, and the necessary procedures in this regard shall be submitted. If the company provides exclusive services or products, it shall be treated in accordance with the applicable regulations governing it.

• A committee shall be formed chaired by the Ministry of Finance, with membership from: (the Ministry of Economy and Planning, the Ministry of Commerce, and the Strategic Management Office at the Council of Economic and Development Affairs), tasked with the following within a period not exceeding (90) days:

  • 1- Establishing governance for reviewing the claims and matters referred to the Ministry of Finance, in accordance with clauses (First) and (Sixth) of these rules, and deciding on them, provided that the governance includes delegating the ownership authority in companies whose ownership or shares the Public Investment Fund does not see fit to transfer to it according to the provisions contained in these rules, to the Minister of Finance and the head of the entity.

  • 2- Establishing governance for government companies that enhances their effectiveness, and improves their efficiency and performance.

• The committee shall submit the two governance frameworks referred to in paragraphs (1) and (2) of this clause to the Council of Economic and Development Affairs for approval.

The Prime Minister may amend the periods stipulated in paragraphs (First) and (Sixth) of these rules.

The Ministry of Finance - in coordination with the Ministry of Commerce and the Public Investment Fund - shall prepare a report including an assessment of the results of the implementation of these rules, the challenges faced by the Ministry or any of the public entities, appropriate proposals for that, and the mechanism for addressing them, and submit it within a period not exceeding (three) years from the date of the entry into force of these rules.