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HomeTechnologyGlobal AI Hub Law: Saudi Arabia’s Digital Governance Leap

Global AI Hub Law: Saudi Arabia’s Digital Governance Leap

Exploring Saudi Arabia's draft law for AI hubs and international data centers

May 1, 2025
in Technology
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The Communications, Space and Technology Commission in Saudi Arabia has unveiled a draft Global AI Hub Law for public consultation, aiming to establish the country as a leader in digital governance and cross-border innovation. The proposed law introduces a new framework for AI hubs and the concept of “data embassies,” enabling foreign entities to host their data and digital assets in Saudi data centers under their home country’s legal framework.

Key goals of the draft include:

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  • Setting up foreign-affiliated data centers to enhance secure, efficient, and sustainable cross-border business operations
  • Leveraging Saudi Arabia’s location to expand access to global technology solutions and reduce the digital divide

As organizations face growing data localization demands and the complexities brought by advanced AI systems, this law shifts the focus to regulating digital infrastructure. By offering various data center models, the draft aims to create secure and adaptable digital environments for international business.

The law could reshape how organizations design and manage their technology infrastructure, offering new options that align with both global policies and local compliance requirements. This approach is expected to support operational flexibility while maintaining regulatory clarity for multinational companies.

The draft is relevant not only to AI developers but also to all tech service providers planning to serve Saudi residents, as it could change expectations around data center operations and digital jurisdiction.

Three types of AI hubs are proposed:

  • Private Hubs: Exclusively serve a specific foreign government, operating under its laws through bilateral agreements, focusing on diplomatic relationships.
  • Extended Hubs: Operated by companies for themselves or their subscribers, governed by the guest country’s laws, based on private sector contracts.
  • Virtual Hubs: Run by Saudi providers for customers domiciled elsewhere, following the regulations of the customer’s home country, allowing for scalable mass service delivery.

The law distinguishes between ‘guest countries’, which have formal agreements with Saudi Arabia for private or extended hubs, and ‘designated foreign states’, which can be served by virtual hubs with a more flexible approval process. This differentiation shapes the level of regulatory oversight and access for each hub type.

Public feedback on the draft law is open until mid-May, providing stakeholders an opportunity to influence the future of digital infrastructure and AI governance in Saudi Arabia.

Tags: AI GovernanceData Centersdata embassiesdigital infrastructuresaudi arabia
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