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What is Saudization?

Saudization compliance is mandatory for all foreign firms operating in, or in the process of setting up a business in Saudi Arabia. The Nitaqat program requires companies to hire Saudi nationals based on quotas determined by company size and industry sector. Failure to comply results in blocked government services, inability to renew work permits, and disqualification from government tenders.

Meeting Saudization requirements is an opportunity for foreign companies seeking to position themselves strategically in Saudi’s rapidly evolving market. It also helps build the perception that the company is not only invested in profits but also wants to contribute to the nation’s socio-economic development.

When Does Your Business Need a Saudization Certificate?

A Saudization certificate serves as verified documentation that your company has achieved the required Nitaqat compliance standards. This credential plays a crucial role in various business interactions with government entities and major Saudi corporations.

Key Situations Requiring a Saudization Certificate:

Participation in public sector procurement

To submit proposals for government contracts or secure contracts within Saudi Arabia's transformative megaprojects, companies must demonstrate Nitaqat compliance through a valid certificate.

Supplier qualification with leading Saudi enterprises

Major national corporations require this documentation during their vendor approval processes.

Increasing foreign worker allocations

When businesses seek to expand their workforce by requesting additional visa quotas for international employees, they must provide evidence of meeting Saudization standards.

Processing key administrative renewals

Several critical business processes depend on a valid Saudization certification:

Extending the General Manager's residency permit (Iqama)
Updating Commercial Registration documentation
Completing periodic MISA license validations

New Saudization Mandates for 2026

Saudi Arabia introduced six major localization decisions in late 2025 and early 2026. Foreign businesses must ensure compliance to avoid penalties.

70% Procurement Localization (Effective: November 30, 2025)

Private sector establishments with three or more employees are required to reach 70% Saudi representation across 12 procurement-related professions. The policy focuses on roles that are critical to supply chain operations and overall business efficiency.

30% Engineering Localization (Effective: Early 2026)

This mandate requires private sector establishments with five or more employees to localize 30% of 46 engineering professions by June 30, 2026. Saudi engineers in these roles must receive a minimum monthly salary of SR8,000 and be accredited by the Saudi Council of Engineers, ensuring consistent professional standards across the sector.

15% Sports & Fitness Localization (Effective: November 18, 2026)

Private sector sports centers and gyms with four or more employees are required to achieve 15% Saudization across 12 roles in both men’s and women’s fitness facilities. These roles include:

• Sports coach
• Professional football coach
• Sports supervisor
• Personal trainer
• Professional athletics coach

55% Dental Professions Localization (Effective January 27, 2026)

This phase applies to all private sector establishments with three or more employees in dental specialties and requires a 55% Saudization rate.

Saudi dentists are only counted under the Nitaqat program if they receive a minimum monthly salary of SR9,000 registered with the General Organization for Social Insurance (GOSI) and hold valid professional accreditation from the Saudi Commission for Health Specialties.

60% Sales & Marketing Localization (January 19, 2026)

Phase 1: Marketing Positions

The initial phase sets a 60% Saudization requirement for marketing positions in private sector companies with three or more employees. Covered roles include:

• Marketing managers
• Advertising managers
• Advertising agents
• Marketing specialists
• Graphic designers
• Advertising designers
• Public relations professionals
• Photographers

A minimum monthly wage of SAR 5,500 is required for these positions.

Phase 2: Sales Positions

The second phase raises the Saudization quota for sales roles in the private sector to 60% for businesses with three or more employees. Covered roles include:

• Sales managers
• Retail and wholesale sales representatives
• IT and communications equipment sales specialists
• Sales specialists
• Commercial specialists

100% Administrative Support Professions (Effective April 5, 2026)

The Ministry of Human Resources and Social Development (HRSD) has expanded its Saudization policy for administrative support roles in the private sector to include 69 additional professions, all subject to 100% localization.

The updated regulation applies to any establishment employing one or more workers in the covered roles, including job titles across secretarial work, translation, data entry, and general administrative support.

Saudization Rates: What Businesses Need to Know

Calculating the Saudization percentage is a complex process driven by three key factors:

• Saudization Percentage (Saudi Employees)
• Entity Size (Total Employees)
• Entity Classification (Activities)

For example:

• For international companies entering Saudi, their second employee after the General Manager must be Saudi national.
• 1 Saudi national is sufficient up to 5 total employees in the company.
• Companies with more than 100 employees must have a Saudization rate of at least 30%.
• There are certain roles and functions where 100% Saudization in the sector is required.

The above can also vary per sector or license type.

Other Interesting Facts About Saudization Quotas

• Companies not meeting the Saudization ratio and other requirements are not able to attain the Saudization certificate, which is mandatory for bidding on Etimad and other public sector projects.
• There is no difference in quotas for men and women
• A Saudi employee with salary less than SAR 4,001 is counted only as 0.5 person towards the Saudization quota
• Employing 1 person with disability counts as 4 persons towards the Saudization quota
• All GCC nationals are counted towards the Saudization quota as Saudi national
• A Saudi employee who is registered under two companies is counted towards the first company’s quota only
• Once the allowance period expires, you must maintain Nitaqat compliance to access the Ministry of Labor portal (Qiwa) services.

Not sure how Saudization applies to your business? Speak with our compliance experts.