Saudi Arabia’s Ministry of Commerce has announced new beneficial ownership reporting requirements, effective from 3 April 2025, as part of the country’s updated Commercial Registry system. The regulations aim to enhance corporate transparency, establish a database for registering and maintaining beneficial ownership data, and strengthen compliance with international requirements.

The regulations were developed in accordance with the recommendations of the Financial Action Task Force (FATF) and international best practices, in collaboration with specialised experts.

Under the new regulations, a beneficial owner is defined as a person who holds or controls at least 25% of a company’s capital or voting rights, can appoint or dismiss directors, or can influence company decisions. If no individual meets these criteria, the company’s director, board member, or chairman is considered the beneficial owner.

These regulations apply to companies subject to the Companies Law, as well as foreign companies conducting business in Saudi Arabia. It mandates that company founders must disclose beneficial ownership information when applying for incorporation. Existing companies at the time these regulations take effect must disclose this information by the deadline corresponding to the due date for their annual confirmation of registered commercial data..

Exemptions apply to publicly listed joint-stock companies, state-owned enterprises, and companies in bankruptcy.

Non-compliance may result in fines of up to SAR 500,000 or other penalties under the Companies Law. Existing companies must comply by their next annual data confirmation deadline.