Global Trade Alert

On 10 September 2011, the second phase of the Nitaqat Program for a "Saudization" of the labor force came into force.
 
The regulation establishes minimum shares reserved for Saudi citizens in a company's labor force. The requirements range from 6 percent in construction, over 19 percent in media, to 49 percent in banking.
 
In order to raise the share of Saudi citizens in the labor force rapidly, firms have been put into four categories subject to different demands.
 
These are:

• Red. The share of foreign workers in the firm's labor force is deemed too high. Firms in this category have until 26 November 2011 to increase their domestic labor force share or visas of its foreign workers will not be renewed.
• Yellow. The share of foreign workers in the firm's labor force is deemed too high. Firms in this category have until 23 February 2012 to increase their domestic labor force. Visas of its foreign workers will not be extended beyond six years.
• Green. These firms show a high degree of "Saudization". They are allowed to hire foreign workers from red and yellow firms.
• Blue or VIP. Firms in this category are not subject to any restrictions on foreign hiring.

 
Pharmacists, goldsmiths and jewelers have been excluded from the described regulation.