The Saudi Council of Ministers has approved the Law of Commercial Registration and the Law of Trade Names, aiming to streamline business operations in the Kingdom.
According to Minister of Commerce Dr. Majed Al-Qasabi, these laws will simplify business practices and reduce the burdens on commercial establishments. They align with the Saudi Vision 2030, reflecting the Kingdom’s economic and technological advancements.
The Law of Commercial Registration, comprising 29 articles, organizes commercial registration procedures, ensures data accuracy, and makes information easily accessible. A central electronic database will record traders’ names and details, eliminating the need for sub-registrations and reducing financial burdens on firms.
Firms have a five-year grace period to update existing sub-registrations. This can be done by transferring them to a main register, creating a new company, or revoking them. Additionally, the law mandates commercial establishments to open bank accounts linked to their registration, enhancing transaction integrity.
The law also removes the requirement to renew commercial registrations, replacing it with an annual electronic confirmation. Failure to confirm within three months will result in suspension, and automatic deletion after a year. Alternative penalties, such as warnings and correction orders, are also introduced.
The Law of Trade Names, consisting of 23 articles, regulates the reservation and registration of trade names, ensuring their protection and maximizing their value. It allows trade names to be reserved before registration and specifies conditions for acceptable names, including the use of Arabic, non-Arabic, or mixed words and numbers.
To enrich Arabic content, the Arabic Language Experts Platform has been created. The law allows the trade name to be independently managed from the commercial establishment and prohibits the use of reserved or registered names without the owner’s consent. It also prevents the registration of similar trade names across different establishments.