Monday, April 22, 2013

Nitaqat System in Saudi Arab

Recently Ministry of Labour, Govt. of Saudi Arab has introduced a new law named 'Nitaqat System' for promoting employment of local people in private firms. This system would replace old 'Saudization' program. As per an estimate about 2.5 million Indian are employed in the Kingdom of Saudi Arab (KSA). Saudi govenment has given three months time for correction of Visa status and other documents. It is expected that only those expatriates shall be affected by this program whose documents are not proper. Indian Embassy of Saudi Arab has provided an e-mail address for providing assistance to Indian nationals who are affected by the Nitqat program. All the Non Resident Biharis (NRB) working in KSA can contact officials of Indian Embassy or visit its website for updated information and assistance if they are affected by this Nitqat Program.


In a Nutshell
  • 41 classifications of employment sectors
  • 5 company classifications based on employee tally
  • 4 compliance-related and disciplinary zones
5 Company Classifications (based on total employee tally)
1-10 employeesEXEMPT from classificationsNitaqat system does not apply
10-49 employeesSMALL classification5-24% Nationalization required
50-499 employeesMEDIUM6-27% Nationalization required
500-2999 employeesLARGE7-30% Nationalization required
3000-more employeesBIG8-30% Nationalization required
4 Compliance-Related and Disciplinary Zones
Blue zone
GREEN zone
RED zone
VIP category

  • Can hire anybody from any part of the world.
  • Easier visa processing
  • New visas with open professions through the electronic system.
  • Can change professions of their workers even to those that are restricted to Saudis, except jobs such as employment officials, receptionists, government liaison officials, treasury staff, and security officers.
  • Condition-free visa transfer: Can hire employees from Red zone and Yellow zones, and transfer their visas without the permission of their employers
  • Entitled to a one-year grace period if their municipal and professional licenses or commercial registrations were expired.
Excellent category

  • Can apply for new visas once every two months.
  • Can change their foreign workers’ profession except to those restricted to Saudis (i.e.human resource managers; liaison officers; cashiers; receptionists; security guards)
  • A six-month respite after the expiry of their zakat & revenue certificates.
  • Can renew work permits of their employees.
  • Can recruit employees in red and yellow zones and transfer their visas without the approval of their employers.
Poor compliance

Punitive Measures:
  • No new visas
  • Can get only one visa after the departure of two expatriates
  • Cannot transfer visas and change professions.
  • No work permit renewal for employees who have completed six years.
  • No control on workers who can switch over to premium zone companies

Grace Period:
9 months to improve their status.

Punitive Measures:
Banned from change of profession, transfer of visas, issuance of new visas and opening files for new branches.

    Grace Period:
    6 months to improve their status.
    Under the new policy, foreign workers employed by companies that are not in compliance are free to work for companies in compliance without acquiring permission from their employers at non-complying companies.

    Source : Saudi Gazette

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