Zakat, Tax and Customs Authority (ZATCA) has made available the Saudi Approved Economic Operator Program (“Priority”), which is considered a global standard and part of the framework agreement of the standards of security & facilitating of the international trade at the World Customs Organization (WCO) since 2005 AD. It is also one of the components of Trade Facilitation Agreement (TFA) at the World Trade Organization (WTO), which come into effect on 22nd February 2017. Priority aims at strengthening the economic process through facilitating the process of commercial exchange, facilitating the procedures of import & export of goods and commodities to the establishment joining to Priority and reducing the period of clearance and on-site inspection. The persons joining to Priority Program will be granted the priority in cases of the manual inspection, in addition, the possibility of clearance and on-site inspection outside the customs zones such as depositing zones or warehouses of the commercial establishments.

• Wherever mentioned in this Policy, the following expressions and terms shall have the meanings ascribed thereto, unless otherwise the context requires:

  • ZATCA: Zakat, Tax and Customs Authority

  • Board: The Board of ZATCA

  • Governor: His Highness, Governor of ZATCA

  • Common Customs Law: Common Customs Law of GCC issued by the Royal Decree No. M/41 dated 03.11.1423 AH and its subsequent amendments.

  • VAT Law: The Value-Added Tax Law issued by the Royal Decree No. M/113 dated 02.11.1438 AH and its subsequent amendments.

  • Implementing Regulations of VAT Law: The implementing regulations of VAT Law issued by the resolution of the Board the General Authority of Zakat and Tax (previously) No. 3839 dated 14.12.1438 AH and its subsequent amendments.

  • Secretariat: General Secretariat of Zakat, Tax and Customs Committees.

  • Policy: Policy of the Authorized Economic Operator Program.

  • Priority: The Authorized Economic Operator Program (“Priority”); a program provides a package of advantages and facilitations to economic operator fulfilling the conditions and standards provided herein. 

  • Establishment: The legal entity or the legal person officially registered at the competent authority in the Kingdom for practicing its business legally.

  • Senior Management: The persons who are responsible for the daily management and supervision or monitoring the establishment including the Chief Executive Officer and each person affiliates to directly.

  • Portal: E-Portal of the Zakat, Tax and Customs Authority.

  • Applicant: The establishment applying via the Portal to join Priority to benefit from the advantages and facilitations submitted to the AEO.

  • Advance Rulings: The official rulings issued by the customs departments in the GCC before the process of import upon the request of importer or exporter. Such rulings include specific information and data related to customs itemization and classification, rules of origin and the customs evaluation of specific commodities that the applicant determines to bring from outside the GCC.

  • Priority Department: The competent department in ZATCA concerned with the receipt and evaluation of the joining applications, follow-up of the establishments obligations and management of their accounts.

  • Application Form: A form to be electronically filled out via the Portal to request to join to Priority, including the basic information of the establishment.

  • Self-Evaluation Form: A form to be sent to the Establishment to be filled out after the initial acceptance of the Application, including the Establishment’s details to know the extent of its fulfillment of the conditions and standards of Priority Program.

  • Control Plan: A form created upon the recommendations of approval report and shall be delivered to the account manager after approval of the Establishment within Priority to ensure the continuity of fulfilling the standards and conditions of the Establishment within the period of its membership in Priority.

  • Account Manager: The employee responsible for serving AEO and processing all of its applications and inquiries inside ZATCA.

  • Risks: All risks related to the Establishment, including the security and financial risks, Zakat, Tax and Custom obligations, the administrative and control risks, security, safety and procedural risks, records keeping and supply chain risks.

  • Mutual Recognition Agreements (MRAs): Agreements signed by and between two countries, upon their desire, to strengthen the security of the supply chain and trade facilitation between them so that the establishment of economic operator can benefit from the same advantages available for the establishments of economic operator in the other country.

  • Advisory Group: All companies having the capacity of economic operator, where they will meet regularly to discuss the controls and conditions of Priority and the provided advantages.

• 1. Appointing a dedicated account manager of AEO within ZATCA for communication and necessary support.

• 2. A dedicated fast lane at land customs ports for AEO.

• 3. According to Common Customs Law and resolutions issued in this regard, delaying the collection of customs charges for thirty days after consignment’s clearance date.

• 4. Prioritized in all customs procedures.

• 5. Reducing inspection process based on risk analysis.

• 6. Exemption from the financial guarantee of the exports of petroleum derivatives.

• 7. According to the Law, benefit from advantages of similar programs in other countries through MRAs.

• 8. Benefit from the advance rulings services.

• 9. The possibility of using the Program’s logo in marketing and publishing the list of authorized economic operator members on ZATCA’s website.

• 10. Membership in the advisory group of the authorized economic operator.

• 11. Offering free customs procedures-focused training courses to the authorized economic operators

• I. Eligibility requirements and criteria:

  • 1. The applicant shall be a resident legal person (company/ institution).

  • 2. The applicant shall be registered with ZATCA for at least one year prior to filling the application submission.

• II. Compliance Requirements and Criteria:

  • 1. The absence of any zakat, tax, or customs evasion cases proven against the establishment within the last three years or as of the establishment registration date, whichever earlier.

  • 2. The absence of any cases of smuggling of banned items proven against the establishment within the last three years or as of the establishment registration date, whichever earlier.

  • 3. Commitment to timely submit returns and pay zakat and tax dues within the previous two years or as of the establishment registration date, whichever earlier.

  • 4. Commitment to pre-submit all customs formation for marine shipments during the last two years.

  • 5. The establishment may not have any unsubmitted returns or unpaid dues for ZATCA, unless there are ongoing disputes with ZATCA or the Secretariat and no final binding judgment has been made for such matters.

  • 6. The lack of any instances of delaying in supplying records and providing customs information to ZATCA if requested throughout the last three years or as of the establishment registration date, whichever earlier.

  • 7. Commitment to provide accurate information to ZATCA before the consignment arrives, without any breach of prior submission of the statement.

  • 8. The establishment's commitment to ZATCA's regulations and the timely payment of due fees without any delay.

• III. Record-Keeping Conditions and Criteria:

  • 1. The establishment that desires to join the Program shall keep papers, documentation, customs information, contracts, documents, correspondence, and records in accordance with the requirements stipulated in Article (127) of the Common Customs Law. The establishment shall keep records, e-invoices, electronic notifications and related information through an integrated operating system allowing the possibility of referencing any old information or documents in accordance with the record-keeping requirements stipulated in Article (66) of the Implementing Regulations of the VAT Law. However, the persons subject to the provisions of the e-invoices regulations shall provide ZATCA with any records, e-invoices, electronic notifications or information required by ZATCA to verify the invoices and electronic notifications provided by them, as well as their commitment to the provisions of the unified Agreement of VAT, VAT Law, Implementing Regulations thereof, and the E-Invoices Regulations.

  • 2. For electronic records and documents keeping, the establishment shall have an integrated operating systems (ERP System).

• IV. Efficiency Conditions and Criteria:

  • 1. The existence of an activated internal policy for ongoing training of security and warehousing personnel in the security domains, as approved by the senior management of the establishment.

  • 2. The existence of an activated policy for commercial establishment self-auditing operations and continuous performance measurement, examined by an accounting office approved by Saudi Organization for Chartered and Professional Accountants.

  • 3. The existence of an administrative structure approved by the senior management.

  • 4. The availability of a customs broker license for persons dealing directly with ZATCA on customs procedures relating to goods clearance.

  • 5. Appointing a liaison officer with a customs clearance certificate at the establishment to coordinate between ZATCA and the establishment.

• V. Solvency Conditions and Criteria:

  • 1. The establishment shall not be subject to attachment or bankruptcy during the last two years.

  • 2. The establishment shall not be subject to liquidation.

  • 3. Availability of financial statements audited by a chartered accountant office accredited by the Saudi Organization for Chartered and Professional Accountants for the last two years or since registration date, whichever earlier, or providing evidence of financial solvency if the above statements are not available in according to the relevant laws.

  • 4. Proof of the establishment's ability to meet its long-term obligations towards ZATCA or any other authority, and ZATCA may request whatever is necessary to ensure the same.

• VI. Security Conditions and Criteria:

  • 1. Availability of policies and procedures approved and activated by the senior management of the inventory management, including the authority matrix, the work methods of supply chain, consignments (containers) and means of transportation. ZATCA shall be informed of any change immediately.

  • 2. Availability of policies and procedures for the security management system approved and activated by senior management, including the authority matrix and the work method of such system.

  • 3. The presence of an approved policy for training personnel on security issues, self-audit operations of the establishment, continuous performance measurement, and the existence of an approved and applied administrative structure.

  • 4. The existence of civil defense license for warehouses for the fire and accident protection system.

  • 5. The establishment shall have an integrated security system approved by one of the Kingdom of Saudi authorized security and risk assessment firms.

  • 6. The existence of security measures to protect facilities, such as adequate fences, CCTV cameras, and internal and exterior alarms, as well as precise procedures and conditions to prevent unauthorized or unlawful entry to facilities, cargo areas, and associated areas.

  • 7. The existence of an approved and functional crisis management and recovery policy.

  • 8. Confirming the ownership of goods warehouses and maintenance continuously with clear procedures to track, handle and inspect the goods, and the provision of transport means able to secure the consignment effectively. In addition, training the operators of transport means to maintain the trucks safety, inspect and secure the means against concealing any legal banned goods.

  • 9. The existence of clear procedures for determining employees ID, in addition to the existence of a documented mechanism for tangible investigation of employees working in sensitive positions in the security aspects. Furthermore, the existence of clear procedures to search the criminal history of any new employee before hiring him/her and to follow up on his/her criminal record on a regular basis. In addition, training employees to comply with security policies and to take necessary measures in emergency.

  • 10. The existence of documented procedures for identifying partners when contracting with them for the purpose of improving the security of the related supply chain, as well as checking the contractual party's commercial information review system and its compliance with the required security standards.

  • 11. The existence of approved procedures to ensure the security of the used system as well as the mechanism for information exchange, access and confidentiality. The existence of backup procedures in the event of system failure; and compliance with national criteria regarding electronic information structure and message content.

• 1. Establishment desiring to obtain the membership of AEO may submit the application directly through the portal.

• 2. The establishment's compliance with Priority conditions shall be verified using the following procedures:

  • a. The application to join the Program shall be submitted Via the Portal by filling out the application form on it.

  • b. The Priority Department shall receive and study the application submitted through the Portal, verify its compliance with the conditions and criteria for joining Priority Program, and initially evaluate such application within (15) days. The aforementioned procedures shall, in coordination with the security departments, include analyzing security risks, issues and affairs, and evaluating the applicant's compliance with other conditions.

  • c. In case of establishment failure to meet the conditions for joining the Program, it shall be informed by e-mail and given an explanation for such failure.

  • d. If the establishment meets the conditions and criteria for joining the Program and its application is initially accepted, the self-assessment form will be sent to the establishment for completion and reply in a period not later than (30) days.

• 1. Validating the establishment's ability to comply with all security, professional, record-keeping and control requirements.

• 2. Ensuring the establishment's financial solvency and ability to meet all financial obligations of ZATCA and its compliance with the terms and standards of the Program in coordination with the relevant managements.

• 3. Evaluating and reviewing the establishment' application as follows:

  • a. Receipt of self-assessment form from the establishment to study its application in detail by the Priority Department according to the terms and criteria of joining the Program.

  • b. If the establishment does not conform to one of the terms and criteria of joining the Program, the establishment will be informed of the rejection with reasons therefor via e-mail.

  • c. If the establishment conforms to one of the terms and criteria for joining the Program in principle, an initial report containing feedback and inquiries that need explanation by the establishment shall be prepared. Accordingly, the procedures for a field visit to the establishment headquarters shall be coordinated.

  • d. A final report shall be prepared after the visit to the establishment, including the result of the assessment phase and the recommendation to accept or reject the application to join the Program and submit it to the Governor or his representative.

  • e. If the application is rejected, the establishment will be informed of the rejection with the reasons therefor and stating that the application may be re-submitted within a period of not less than one year from the date of notice.

  • f. If the application is accepted, the establishment will be informed of the acceptance, whereas the notice shall contain the information of account manager as well as information regarding the membership of the Program.

• 4. An AEO number for the establishment shall be issued in the system.

• 5. After the establishment had obtained its membership of the Program, the account manager shall be provided with a follow-up plan by the Priority Department.

Priority Department shall review the establishment joining application for the AEO Program and shall verify the fulfilment of requirements set out in the policy and issue its decision within a period not exceeding 90 days after receiving the self-assessment form.

• 1. The account manager shall be provided with a follow-up plan and submit a monthly or quarterly report to follow up on the establishment's compliance with the conditions and criteria set out in the policy to join the Program.

• 2. ZATCA has the right to visit the establishment on a regular basis in accordance with the follow-up plan. The establishment compliance shall be followed-up in accordance with the following:

  • a. Compliance with submitting and repaying Zakat and Tax returns in the specified time without any delay.

  • b. Compliance with the regulations of ZATCA and pay the due fees at specified time without any delay.

  • c. Compliance with the control plan and application of all its items within the specified time.

• 3. If the policies and procedures relating to the assessment criteria are amended by the establishment granted the AEO membership, the account manager of ZATCA shall be informed in writing/ via e-mail within 24 hours from the date of amendments approval and shall be provided with a copy thereof.

• 4. Visit of the establishment headquarters shall be regularly according to the control plan.

• 1. If the Priority Department finds that the establishment breaches any of the conditions and criteria set out in the policy to join the Program, it shall warn the establishment to remedy such breach within (15) days. If fails to do so within such period, the Priority Department shall suspend or cancel its membership in accordance with the suspension and cancellation procedures set out in the Policy.

• 2. The duration of the suspension shall not be less than six months and not more than one year as determined by the Priority Department based on the violation committed by the establishment.

• 3. If the membership is cancelled, the establishment shall not be entitled to re-submit the application for membership in the Program until at least three years after the date of cancellation.

• 4. Suspension and cancellation procedures shall be as follows:

  • a. The follow-up team shall study and assess the violation and check the possibility of applying the suspension or cancellation.

  • b. Submitting the request of suspension/ cancellation to the Priority Department Director for acceptance or rejection.

  • c. Meeting with the establishment board to discuss the violation.

  • d. The Priority Department shall inform the establishment account manager of the relevant decision.

• 5. The establishment account manager shall be provided with the Priority Department decision.

• 1. The Priority Department shall suspend the establishment membership if one of the following facts occurred:

  • a. Reduction of establishment's compliance with Zakat, Tax and Customs.

  • b. The establishment does not cooperate in providing ZATCA with any data or information regarding its control plan to join the Program such as: (audited financial budgets, fundamental changes in the structure, failure to remedy feedback notified by the audit department during the audit period) or any other requests.

  • c. The establishment commits any breach of the regulations during its term of AEO membership such as: (counterfeit goods, disposal of goods while there are undertakings, smuggling of restricted goods, customs differences and drop of the value).

  • d. The establishment breaches one of the terms and criteria set out in this Policy to join the Program.

  •  e. Based on the request of the establishment due to its inability to meet the specified terms and criteria.

• 2. The Priority Department shall cancel the establishment membership if one of the following facts occurred:

  • a. Confirmation of Zakat, Tax, Customs evasion or smuggling cases against the establishment.

  • b. Suspension of the AEO capacity of the establishment for more than two times during the AEO membership term.

  • c. If the legal suspension period expires without remedy or correction based on the improvement plan proposed by the Priority Department.

  • d. Expiration of the establishment activity, liquidation or its merge into another establishment, resulting in the cancellation of its legal entity.