Saudization Requirements: Nitaqat Consequences

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Nitaqat is an initiative by the Ministry of Labour and Social Development (MLSD) and works towards the nationalization of the Saudi workforce. The MLSD has laid out a minimum percentage of Saudi nationals that must be employed by companies of different sizes and introduces a color-coded classification system to categorize different companies depending on their level of Saudization. This article highlights the main consequences of doing business under a specific categorization. As of November 2019, there are five[1] different Nitaqat categories granting different rights to the relevant entity, the categories are red, lower green, middle green, higher green, and platinum.

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[1] The yellow category has been removed by the Council of Ministers Decision No.63717 on 29/03/1441H corresponding to 27/11/2019G. Entities formerly classified as the yellow move to the red category.