Statute of the Economic Cities and Special Zones Authority

Issued by Royal Order No. A/19, dated 10/3/1431H. This Statute is issued and authoritative in Arabic only. For the official Arabic text in the Bureau of Experts' laws database, click here.

The summary below reflects the Statute's real structure and provisions; it is not an official translation.

Establishment, Status, and Mandate of the Authority

The Statute establishes the Economic Cities and Special Zones Authority (ECZA) as a body reporting directly to the King, with legal personality and financial and administrative independence, headquartered at King Abdullah Economic City in Rabigh. The Authority operates on commercial principles and has the flexibility and powers needed to carry out its mandate under its own internal, financial, and administrative regulations (Articles 2–3).

The Authority has full administrative and financial oversight of the economic cities and special economic zones under it, and oversees zones administered by other relevant entities within the limits set by the Statute. Its powers include: concluding agreements and contracts and drawing up development plans; reviewing and approving general master plans and any amendments to them; setting infrastructure, building, and public-safety standards; issuing licenses for commercial, industrial, service, professional, educational, training, and health activities; setting fees for licenses and services; granting usufruct rights; establishing or taking shares in companies; overseeing developers, investors, operators, contractors, workers, residents, and visitors; studying and proposing the establishment of new economic cities and zones; researching and proposing financial, customs, and tax exemptions and incentives; and coordinating with relevant entities on zones under their administration (Article 3).

A relevant entity administering a special economic zone on the Authority's behalf holds equivalent powers over that zone — concluding agreements, setting infrastructure and safety standards, granting usufruct rights, and overseeing developers, investors, operators, and workers within it (Article 3 bis).

Board of Directors and Its Powers

The Authority has a Board of Directors whose Chairman is appointed by royal order, with members of relevant expertise from the public and private sectors nominated by the Chairman and appointed by royal order for a renewable three-year term (Article 4). The Board is the authority responsible for the Authority's affairs and supervises its administration and the management of the economic cities and special zones, without being bound by standard financial and administrative rules. Its powers include: setting the Authority's policies and approving its programs; approving its organizational structure and its administrative and financial regulations (financial regulations require agreement with the Ministry of Finance); approving fees for licenses and services; approving usufruct rights; approving the annual budget, final accounts, and auditor's and annual reports before submission to the King; forming committees; proposing the establishment of new economic cities and zones and proposing exemptions and incentives for submission to the Council of Ministers; and approving the regulations, rules, and arrangements specific to each city or zone (Article 5). Board meetings are held at least quarterly, require a quorum of the majority of members, and are governed by majority voting, written minutes, and confidentiality obligations for members (Article 6).

Secretary-General

The Authority has a Secretary-General appointed by the King, who is its chief executive officer, responsible — within the Statute and the Board's decisions — for overseeing Board meetings and the implementation of Board resolutions, preparing the Authority's budget, final accounts, and annual report, overseeing staff, issuing expenditure orders under the approved budget, reporting periodically to the Board, proposing and overseeing the Authority's plans and programs, representing the Authority before other parties and the courts, and delegating some of these powers to the Authority's officials (Article 7).

Financial Resources

The Authority's financial resources consist of state appropriations, revenues from the services it provides, gifts, donations, endowments, and other resources the Board decides to add. The Authority retains and spends its own revenues directly on its activities, keeps its funds in an account with the Saudi Central Bank in addition to accounts with licensed banks, and covers all its expenses from these resources without the state bearing any obligation in this regard (Articles 8–9).

The Economic Cities and Special Economic Zones

One-stop-shop service centers are established within the economic cities and special zones under the Authority's supervision, bringing together government and non-government service entities to deliver services to developers, operators, investors, and residents under a "60×24×7" service concept — completing any government service within sixty minutes, around the clock, every day of the week (Article 10). The Authority markets investment opportunities in the cities and zones locally and internationally in coordination with developers (Article 11), and developers have full freedom to manage their business and implement agreed projects once the Statute's requirements are met (Article 12).

Real estate within the cities and zones is registered in the Authority's own property registers, and the Authority issues an official title deed for each registered property through its own notarial records (Articles 13–14). Non-Saudis may own or hold usufruct rights over real estate within the cities and zones under rules set by the Board and approved by the King (Article 15). The Authority issues work permits within the cities and zones, with priority given to Saudi nationals, in coordination with the Ministry of Labor (Article 16), and establishes — in agreement with the Ministry of Interior — a round-the-clock security department responsible for traffic, movement, firefighting, rescue, and other emergency operations within the cities and zones (Article 17). Developers, operators, investors, workers, residents, and visitors are required to observe the Kingdom's public values and standards of conduct (Article 18).

The Authority may, with the cities' and zones' developers, establish and administer deposit and re-export zones with the infrastructure needed to host industrial, commercial, and service activities (Article 19). Investors are treated, for exemptions and financial, customs, and tax incentives, in accordance with the relevant Council of Ministers resolution (Article 20). The Authority has the right to enter any site or building within the cities and zones — other than private residences — in coordination with the relevant executive director (Article 21). Separate regulations issued by the Board govern, for each zone under a relevant entity, licensing controls, real estate registration, title deeds, the zone's security department, and deposit and re-export zones (Article 21 bis).

The Authority sets environmental protection regulations for the cities and zones in coordination with the National Center for Environmental Compliance, applied when issuing licenses to developers, operators, and investors (Article 22), and works to enforce intellectual property protection within the cities and zones, including through agreements with the competent parties (Article 23).

Final Provisions

The Authority's fiscal year follows the state's fiscal year (Article 24). The Secretary-General submits an annual report to the Board within ninety days of the start of each fiscal year on the Authority's achievements, difficulties, and proposals, for submission to the King (Article 25). The Board appoints one or more licensed auditors, whose report is submitted to the Board (Article 26). The Authority's imports are exempt from customs duties on the same basis as other public authorities (Article 27). This Statute takes effect from the date of its approval (Article 28).