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Amendment of Rule (300-1-4) of Account Opening Rules

No: 44082632 Date(g): 18/5/2023 | Date(h): 28/10/1444 Status: In-Force

Translated Document

In reference to Rule (300-1-4) concerning Residents Investing Under Foreign Investment Law, as outlined in the Account Opening Rules communicated pursuant to SAMA Circular No. (65681/67) dated 01/11/1440H.

I inform you of the amendment to the rule mentioned above according to the attached version. Please note that the main amendments are as follows:
 

  1. Eliminating the requirement to obtain the foundational documents of the foreign or national entity partner in the foreign company licensed in Saudi Arabia (such as the commercial register and the memorandum of association), and replacing it with a requirement to understand the ownership structure and identify the partners whose names are mentioned in the memorandum of association or the articles of association, and verifying them using documents, data, or information from a reliable and independent source, with the possibility of completing the verification process later after account opening, according to specific regulations.
     
  2. Eliminating the requirement to obtain a power of attorney – in all cases – for managing and operating the account, with an explanation of the mechanism for verifying the validity of the authorization.
     

For your information and action accordingly as of this date.
 

Amendment to Rule (300-1-4) concerning Residents Investing Under Foreign Investment Law, as outlined in the Account Opening Rules 
 

300.1.4 Residents Investing Under Foreign Investment Law
 

The bank may open accounts for entities wholly owned by a foreign investor or jointly owned by a foreign investor and a Saudi investor upon receiving the following:
 

300.1.4.1 Joint-Venture Entities Owned by a Saudi Investor and a Foreign Investor:
 

  • Joint-venture entity owned by a foreign investor (natural or juristic) and a Saudi investor (natural or juristic):
     
1.A copy of the license issued by the Ministry of Investment.
 
2.A copy of the commercial register without the need to acquire the business license, or a copy of the professional license of the entity if the entity is a service provider.
 
3.A copy of the memorandum of association or the articles of association and its annexes.
 
4.A copy of the ID of the manager in charge in the entity. A copy of the passport can be sufficient, provided that a copy of the Iqama is submitted (90) days after opening the account.
 
5.Copies of the IDs of persons authorized to operate and manage the account, and verification of their authorization by identifying them in the memorandum of association, the articles of association, or a decision from the board of directors or partners – or their equivalent. If the authorized person for the account is an agent acting on behalf of the principal, a copy of the power of attorney issued by a notary public or a notary in Saudi Arabia must be provided, or the power of attorney must be authenticated by the Saudi embassy or with an Apostille Authentication if issued outside Saudi Arabia.
 
6.Understanding the ownership structure and identifying the partners whose names are mentioned in the memorandum of association or the articles of association, and verifying them using documents, data, or information from a reliable and independent source. -In cases where money laundering risks are lower-, the verification process can be completed later, after the account is opened, provided that it is done as quickly as possible. Any delay in identity verification must be necessary to avoid disrupting normal business procedures, and appropriate and effective measures should be applied to control money laundering risks.
 

300.1.4.2 Entities Wholly Owned by a Foreign Investor:

• Branches of foreign corporations or companies:

1.A copy of the license issued by the Ministry of Investment.
 
2.A copy of the commercial register without the need to acquire the business license, or a copy of the professional license of the entity if the entity is a service provider.
 
3.A copy of the ID of the manager in charge in the entity. A copy of the passport can be sufficient, provided that the Iqama is submitted (90) days after opening the account.
 
4.A copy of the commercial register or professional license, as well as the memorandum of association or the articles of association of the entity in the home country, certified by the Saudi embassy or with an Apostille Authentication.
 
5.Copies of the IDs of persons authorized to operate and manage the account, along with verification of their authorization by identifying them in a mandate from the main office of the company or corporation in the home country. The authorization must name the persons authorized to sign on behalf of the company in Saudi Arabia regarding the bank accounts.
 
6.Understanding the ownership structure and identifying the partners of the entity in the home country, whose names are mentioned in the memorandum of association or the articles of association, and verifying them using documents, data, or information from a reliable and independent source. -In cases where money laundering risks are lower-, the verification process can be completed later, after the account is opened, provided that it is done as quickly as possible. Any delay in identity verification must be necessary to avoid disrupting normal business procedures, and appropriate and effective measures should be applied to control money laundering risks.
 

• An entity owned by a foreign investor or jointly owned by more than one foreign investor:

1.A copy of the license issued by the Ministry of Investment.
 
2.A copy of the commercial register without the need to acquire the business license, or a copy of the professional license of the entity if the entity is a service provider.
 
3.A copy of the memorandum of association or the articles of association and its annexes.
 
4.A copy of the ID of the manager in charge in the entity. A copy of the passport can be sufficient, provided that the Iqama is submitted (90) days after opening the account.
 
5.Copies of the IDs of persons authorized to operate and manage the account, and verification of their authorization by identifying them in the memorandum of association, the articles of association, or a decision from the board of directors or partners – or their equivalent. If the authorized person for the account is an agent acting on behalf of the principal, a copy of the power of attorney issued by a notary public or a notary in Saudi Arabia must be provided, or the power of attorney must be authenticated by the Saudi embassy or with an Apostille Authentication if issued outside outside Saudi Arabia.
 
6.Understanding the ownership structure and identifying the partners whose names are mentioned in the memorandum of association or the articles of association, and verifying them using documents, data, or information from a reliable and independent source. -In cases where money laundering risks are lower-, the verification process can be completed later, after the account is opened, provided that it is done as quickly as possible. Any delay in identity verification must be necessary to avoid disrupting normal business procedures, and appropriate and effective measures should be applied to control money laundering risks.
 

• Foreign individual investor (Sole proprietorships):

1.A copy of the license issued by the Ministry of Investment.
 
2.A copy of the commercial register without the need to acquire the business license.
 
3.A copy of the Iqama for the manager in charge and the investor, owner of the entity. A copy of the passport can be sufficient, provided that the Iqama is submitted (90) days after opening the account.
 
4.The full address of the investor in his/her home country.
 
5.Copies of the IDs of persons authorized to operate and manage the account, as identified in a power of attorney certified by a notary public or a notary if issued inside Saudi Arabia and by the Saudi embassy or Apostille Authentication if issued outside Saudi Arabia, in the case of an agent or authorized person other than the owner of the entity.