Saudi Arabia approves issuance of new tendering, procurement law
Council of Ministers approves law that will boost transparency and payments for construction contractors and SMEs
Saudi Arabia’s Council of Ministers has passed a resolution approving a fresh tendering and procurement law that is expected to help overcome the shortfalls of the existing regulation, make the bidding process fairer, drive cost efficiencies on upcoming and under-construction projects, and enhance local bidder participation.
In a statement by Saudi Arabia's Ministry of Finance, the kingdom’s Minister of Finance, HE Mohammed bin Abdullah Al-Jadaan, said: "The law will enhance integrity and competition by preventing the impact of personal interests, thereby protecting public funds."
According to the minister, the law will provide more transparency in all tender and procurement procedures, including the submission and opening of proposals through a unified portal called Etimad.
The portal will also help to allocate and manage financial resources effectively.
Minister of Finance Thanks Leadership on Approving New Government Tendering and Procurement Law.https://t.co/Jlvd5di6iL— وزارة المالية السعودية (@MOFKSA) July 16, 2019
The minister noted that the law had been developed to meet the needs of public and private sectors in the kingdom, with the additional aim of helping government organisations to issue direct payments, when approved, for contractors and subcontractors.
The issuance of the law is expected to establish a clear mechanism to assimilate the prices of contracts and compensations, particularly with respect to any changes in the values of raw materials, customs duties, and taxes.
The tendering and procurement law also makes provisions for local small and medium enterprises (SMEs) by prioritising them over large-scale businesses and waiving off the initial guarantee.