A new paper from law firm King & Spalding summarizes the new Privatization Law in Saudi and seeks to assess its impact in its first twelve months, “including the extent to which it has achieved its stated objectives, as well as to highlight key takeaways for industry participants and lessons learned from our experience in procurement processes governed by the Privatization Law.”
The paper, available here, notes that prior to the introduction of the Privatization Law, “PPPs were not subject to any dedicated regulatory framework and commonly fell within the ambit of the existing Government Tenders and Procurement Law. As a result, a common barrier to private sector entities considering investment in the Kingdom (Sponsors) and their financiers (Lenders) entering into the Saudi market was the perceived lack of certainty as to the procurement process and risk profile for PPPs. The Privatization Law, which came into full force and effect in July 2021, sought to overcome this by providing a dedicated, bespoke framework pursuant to which PPPs could be delivered in the Kingdom and through which risks to Sponsors and Lenders could be identified and mitigated.”
The paper notes that the twelve months following the implementation of the Privatization Law “have seen a notable increase in the number and value of PPP procurements commencing in the Kingdom, led particularly by projects in the health and education sectors as well as relating to the provision of utility and municipal services.”
