WT/TPR/M/407/Add.1 12 April 2021 (21-3000) Page

WT/TPR/M/407/Add.1

12 April 2021

(21-3000) Page: 1/157

Trade Policy Review Body Original: English/anglais/inglés 3 and 5 March 2021

TRADE POLICY REVIEW

THE KINGDOM OF SAUDI ARABIA MINUTES OF THE MEETING Addendum Chairperson: H.E. Mr. Harald Aspelund (Iceland)

This document contains the advance written questions and additional questions by WTO Members, and replies provided by Saudi Arabia.1

Organe d'examen des politiques commerciales 3 et 5 mars 2021

EXAMEN DES POLITIQUES COMMERCIALES

LE ROYAUME D'ARABIE SAOUDITE COMPTE RENDU DE LA REUNION Addendum Président: S.E. M. Harald Aspelund (Islande)

Le présent document contient les questions écrites communiquées à l'avance par les Membres de l'OMC, leurs questions additionnelles, et les réponses fournies par Arabie saoudite.1

Órgano de Examen de las Políticas Comerciales 3 y 5 de marzo de 2021

EXAMEN DE LAS POLÍTICAS COMERCIALES

EL REINO DE LA ARABIA SAUDITA ACTA DE LA REUNIÓN Addendum Presidente: Excmo. Sr. Harald Aspelund (Islandia)

En el presente documento figuran las preguntas presentadas anticipadamente por escrito y las preguntas adicionales de los Miembros de la OMC, así como las respuestas facilitadas por Arabia Saudita.1

1 In English only./En anglais seulement./En inglés solamente.

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CONTENTS

ARGENTINA ...... 3 BRAZIL ...... 5 BRAZIL – ADDITIONAL QUESTIONS ...... 8 CANADA ...... 16 CANADA - FOLLOW-UP QUESTIONS ...... 27 CHILE ...... 28 CHINA ...... 33 CHINA - ADDITIONAL QUESTIONS ...... 40 EGYPT ...... 48 EUROPEAN UNION ...... 49 EUROPEAN UNION - FOLLOW-UP QUESTIONS ...... 72 ICELAND ...... 74 INDONESIA ...... 75 JAPAN ...... 80 KAZAKHSTAN ...... 82 KOREA ...... 83 MALAYSIA ...... 87 OMAN ...... 98 PHILIPPINES ...... 99 RUSSIAN FEDERATION ...... 110 SINGAPORE ...... 114 SWITZERLAND ...... 116 CHINESE TAIPEI ...... 119 TURKEY ...... 120 UKRAINE ...... 127 UNITED KINGDOM ...... 134 UNITED STATES ...... 144 UNITED STATES - FOLLOW-UP QUESTIONS ...... 154

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ARGENTINA

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 3.13. On 1 January 2018, the SCA introduced the Authorized Economic Operator (AEO) programme, which is based on a partnership between the SCA and businesses to strengthen the security of the international supply chain and provide more trade facilitation benefits. Could you provide more information regarding the actions carried out to reinforce the security of the international supply chain?

Answer The authorized economic operator programme aims to enhance the security of the international supply chain through scrutiny and verification of companies that have applied for the programme in order to ensure that they meet standards and comply with the supply chain security standards framework. As of February 2021, there are more than 190 companies registered by General Customs Authority as authorized economic operator and classified as low-risk business partners after formal scrutiny by General Customs Authority to ensure that they meet compliance and security standards (e.g., trade partners).

Question 2 3.21. During the review period, the main changes introduced regarding customs valuation refer to publishing customs valuation rules on the SCA website, and applying the importer's right to appeal without penalty before the Customs Valuation Committee. The Customs Valuation Committee handles the settlement of disputes arising between importers and the SCA over valuation. Its decisions are issued and shall be endorsed by the Governor of the SCA. Could you elaborate on the characteristics of the valuation dispute settlement process between importers and SCA?

Answer Since KSA's accession to WTO, customs evaluation legislation and rules have been published in official gazette and the website of General Customs Authority, including references to the importer's right to appeal without penalty before the Customs Valuation Committee and before the judiciary. Pursuant to this legislation, the Customs Valuation Committee is responsible for the settlement of disputes between importers and customs and issues its resolutions having approved by the Governor of General Customs Authority. The working mechanism is as follows:

1. If an objection made by the importer to the valuation resolution at the customs port, the transaction shall be submitted to the Valuation Committee. 2. The Committee's secretariat communicates with the importer to request the grounds of objection, purchase documents and other costs paid. 3. The members of the Committee shall meet to examine the facts and the grounds and determine the appropriate customs value in order to settle the existing dispute and make a decision accordingly. 4. His Excellency the Governor of Customs ratifies the resolutions made by Valuation Committee on the basis of majority vote. 5. The importer shall be informed of the contents of the resolution in writing and has the right to appeal against the resolution of the Valuation Committee before court with no penalty or fine applied.

Question 3 3.79. The Saudi Export Program (SEP) is the official national export credit agency, with the objective of diversifying non-oil exports through the provision of financing to Saudi exporters or importers in other countries of non-oil goods from Saudi Arabia. For better understanding the mechanism to access the Program, could you provide more details on how operators from other countries can have access to this program?

Answer Operators from other countries can access SEP's services by applying directly to the program through different means such as: website: www.sfd.gov.sa E-mail: [email protected] Fax: +966114659699 Phone NO: +966112794000 They can also access SEP's services by applying to accredited banks abroad, the list of such banks can be found on SEP's website.

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Question 4 3.93. The SIDF extends loans to eligible Saudi and foreign companies/firms that are registered in the commercial registries. An SIDF loan provides a maximum term of 15 years, covering up to 50% of the fixed assets, pre-operating expenses, and start-up working capital; for projects in less developed or remote cities, the term may be extended to 20 years, and the loan may be increased up to 75%. Could you indicate what are the necessary conditions that foreign companies / firms must meet to obtain the above-mentioned loans?

Answer Foreign companies are granted the same treatment as national companies. Foreign companies / firms, as well as national companies/firms, are eligible for SIDF Loans on the basis of the creditworthiness of the applicant, the technical qualities of the project and commercial viability of the project.

Question 5 3.137. The new Competition Law aims to protect and encourage fair competition and to combat and prevent monopolistic practices that affect lawful competition or consumer interest, leading to improved market environment and economic development. It applies to all firms in Saudi Arabia, regardless of their nationality or headquarters. Table 3.10 summarizes some of the most important differences between the old and the new competition laws. Could you explain in more details what are the aspects of the new Competition Law that aim at achieving these above-mentioned objectives?

Answer The new Competition Law implements important measures that focus on the inclusion of state- owned enterprises to ensure the implementation of fair competitive practices and guarantee clarity in the prerequisites for notification in economic concentrations for all entities that bear an effect on the market competition landscape of the Kingdom. These clarifications will enhance the effectiveness of the Competition Authority in implementing its laws and pave opportunities to conduct industry studies with greater due diligence.

Question 6 3.83. A key element under Vision 2030 and the National Industrial Development and Logistics Program (NIDLP) is the creation of special economic zones (SEZs). SEZs form part of a larger effort by Saudi Arabia to attract foreign investment and diversify the economy away from oil and gas. Could you comment on the effects of such measures on FDI? Likewise, it is interesting to know the measures undertaken by the Saudi authorities that aim at enabling the installation of foreign investment facilities in Saudi Arabia, the requirements that these investors must meet for this purpose?

Answer These zones' main purpose is to create an attractive business environment to attract FDIs, which will in turn create jobs and contribute to the country's GDP. Each of the launched zones will be focusing on certain sectors that requires specific amendments to the current regulations, and/or certain incentives that should be granted. Thus, these zones will develop sector specific regulations along with the general business regulations, which will be amended to create an attractive and competitive environment.

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BRAZIL

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 Page 10: Paragraph 17 recalls that "as part of its accession commitments, Saudi Arabia agreed to start negotiations to join the Government Procurement Agreement (GPA) at a future date". Could the Saudi delegation be so kind as to elaborate on how the recently announced decision, as reported by several news outlets, to "cease contracting with companies and commercial institutions whose regional headquarters are not located in the Kingdom in a move aimed at encouraging foreign firms to open a permanent, in-country presence that would help create local jobs" (Reuters, "International companies without headquarters in Saudi 'will have to make a choice' to land government contracts in 2024 - finance minister", 16 February 2021) reconciles with Saudi Arabia's commitment to join the GPA?

Answer At the time of Saudi Arabia's accession to the WTO and its confirmation to initiate negotiations for the membership in the Agreement on Government Procurement by tabling an entity offer and the condition that if the results of the negotiations were satisfactory to the interests of Saudi Arabia and the other Parties to the Agreement, Saudi Arabia would complete negotiations for membership in the Agreement. It is worth mentioning that the said confirmation by Saudi representative at that time pertains and was specific to a previous version of the Agreement.

Question 2 Pages 31-32 Paragraph 2.43 states that among all the free trade agreements negotiations in which the Gulf Cooperation Council (GCC) has engaged since the late 2000's only the one with China is currently ongoing and that the GCC is now reviewing its positions regarding all its FTA negotiations. Could the Saudi delegation indicate when it expects the GCC will conclude its positions reviewing regarding the FTA negotiations previously launched?

Question 3 Likewise, paragraph 2.44 states that "the GAFT is currently assessing the potential to expand the Kingdom's network of FTAs in light of the Vision 2030 goals". Could the Saudi delegation elaborate on the prospects for the country's engagement in additional negotiations?

Answer Saudi Arabia, jointly along with other GCC member states, plan to increase their share in international trade through expanding their network of preferential trade agreements.

Question 4 Page 58 Paragraph 3.109 TRADE policies and practices by measure: Standards and technical Requirements Regarding Halal requirements for importing of food products of animal origin, Saudi Arabia announced in November 2019 the National System for Halal Products, in which the Saudi Standards, Metrology and Quality Organization (SASO) would be responsible for the accreditation of Halal certification bodies and SFDA would be responsible for issuing Halal standards. Since November 2020, SFDA is requesting Halal certification bodies to register with the SFDA Halal Center and is charging fees for Halal certification of food products of animal origin exported to Saudi Arabia. In light of the concerns that Halal requirements could create obstacles to trade, could Saudi Arabia clarify the Halal certification process for food products of animal origin exported to the Kingdom and the responsibilities of each Saudi authority involved?

Answer There is no change regarding halal standards, halal certification bodies shall apply the GSO halal standards, to ensure that any HCBs follow the GSO halal standards can get the recognition.

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Question 5 Considering the WTO principle of national treatment (Article 3 of the GATT), could Saudi Arabia clarify if local producers of food products of animal origin are subject to the payment of fees for Halal certification?

Answer Local producers also apply for halal certificate for their products and pay the relevant fees to issue the halal certificate.

Question 6 Page 60 Paragraph 3.124 The SFDA implemented a non-automatic import licensing system for poultry meat and its products, eggs and its products and fisheries in which importers must present, among other documents, an import plan including the required quantity to be imported to the Kingdom every six months, the monthly production capacity of the exporting establishment, the percentage of its production to be destined to the Saudi market, and the quantity expected to be imported every month. According to article 4 of the WTO Uruguay Round Agriculture Agreement the access to Members' markets can only be regulated through customs duties (tariffs or tariff quotas). Measures such as quantitative restrictions and discretionary import licensing are required to be converted into ordinary customs duties. Also, the WTO Agreement on Import Licensing Procedures states: (i) in Article 1.2, that members shall ensure that the administrative procedures used to implement import licensing regimes are in conformity with the provisions of GATT including its annexes and protocols, with a view to preventing trade distortions; (ii) in Article 1.3, that the rules for import licensing procedures shall be neutral in application and administered in a fair and equitable manner; and (iv) in Article 3.2, that non-automatic licensing shall not have trade-restrictive or distortive effects on imports additional to those caused by the imposition of the restriction. In light of the above, could Saudi Arabia clarify the objectives of this new import licensing system?

Answer The import license is not intended to restrict the quantity or value of imports. The purpose of licensing is to ensure that goods that do not meet the requirements of different laws, regulations or decisions are not imported.

Question 7 Page 61 Paragraph 3.125 On 10 February 2020, the SFDA suspended the imports of two major Brazilian poultry-producing plants, SIF 1985 and SIF 2518. One of them was responsible for over 20% of Brazilian poultry exports to Saudi Arabia. The Brazilian government took note of the measure adopted by SFDA with great surprise as no previous consultations on the matter were made by the Saudi sanitary authority. Brazil noted Saudi Arabia's reference to media reports on an investigation conducted in Brazil regarding an alleged fraud scheme in the production of animal feed but no clear technical reasons for the suspension have been provided by the Saudi authorities. Brazil clarified that neither of the plants affected by the suspension of imports was involved in the investigation and provided all necessary technical information to Saudi Arabia. Article 2.2 of the WTO SPS Agreement sates that "Members shall ensure that any sanitary or phytosanitary measure is applied only to the extent necessary to protect human, animal or plant life or health, is based on scientific principles and is not maintained without sufficient scientific evidence". Could Saudi Arabia explain the technical reasons for maintaining the suspension applied to the establishments SIF 1985 and SIF 2518 and inform on the revision of the documents and information provided by Brazil with a view to reconsider its restrictive measures as urged by the SPS Committee in its summary reports concerning STC Number 486?

Answer SFDA previously clarified the technical reasons for applying these measures. In addition, SFDA would like to highlight that it will reconsider lifting the suspension based on a technical team visit, which will be carried out after the outbreak.

Question 8 On August 2019, SFDA suspended the imports of meat products from a processing plant located in UAE that belongs to a Brazilian company. According to the Brazilian company, all adjustments requested by SFDA have been made and all technical information requested has been provided. Could Saudi Arabia explain the reasons for maintaining the suspension applied to this facility?

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Question 9 Page 61 Paragraph 3.127 Could Saudi Arabia clarify the procedures adopted by Saudi Customs and SFDA for rejected food shipments and the process for notifying rejections to exporting countries?

Answer When a shipment is rejected, the SFDA notifies the SCA with the list of reasons why it was rejected and the SCA contacts the importer to notify them, the importer is the point of contact between the exporting country and the SFDA when it comes to rejecting shipments.

Question 10 Page 83 Paragraph 4.18 The Secretariat report states on paragraph 4.18 that "In January 2020, the Ministry of Environment, Water and Agriculture issued a new animal feed policy, replacing most subsidies to poultry farmers for imported feed (of corn and soybeans) with direct support to licensed (small) poultry farmers". Could Saudi Arabia provide further details about this program and the eligibility criteria of the beneficiaries?

Answer The new agricultural support policy aims to redirect agriculture subsidies, by providing direct support (payments) to small livestock producers and farmers, only beneficiaries who are eligible for support, according to eligibility criteria such as income, livestock head numbers … etc, will be granted these subsidies, under the new agricultural subsidy program.

Question 11 Page 84 Paragraph 4.19 of the Secretariat states: "4.19. The ADF provides interest-free loans, including repayment subsidies: (i) to small farmers and medium-sized enterprises growing specialty products; (ii) to importers of products related to food security through the Agricultural Products Import Finance Program; and (iii) for Saudi investments in priority crops abroad under the Agricultural Investment Abroad (AIA) Program. Loans cover investment costs to varying degrees, depending on the size of the investment and with projects using modern technologies or those implemented by joint-stock companies being eligible for a higher financing share. As a result of the COVID-19 pandemic, additional funds were allocated to food-security-related import programmes, to support SMEs with working capital loans, and to reschedule existing loans to SMEs to alleviate liquidity issues. The number and value of ADF loans have declined since 2015, while overall subsidies increased and approved loans in 2019 increased sharply (Table 4.5).

Answer Under COVID-19 relieve fund ADF's has divided the funds to assists SME and Micro business in loan repayment up to 6 months and for large companies to import necessity foods under food security program. ADF categorize its customers under large companies, SME and Micro businesses. SME are companies or individual business with turnover between SAR3 million and SAR40 million and the exposure to ADF loans should not exceed SAR6 million. Micro businesses are companies or individual business with revenue not exceeding SAR3 million with exposure to ADF loans should not exceed SAR0.5 million. Currently, to assists both Micro and SMEs, ADF did not charge any rates for any loans on Micro and for SME, a minimal fee of 2.0% per annum which will only become effective after 2 years of grace period 2 years of grace period. Specialty product are products deemed to be necessity under Food Security program and has been classified under primary products and secondary products. The primary products include all products produces from 3 sectors locally such as Greenhouses, Poultry and Aquaculture. In addition to that, primary products that being imported are alfalfa, wheat, maize and red meat. The secondary products that being imported are rice, soya, barley, and edible oils. The choice of these crops is basically due to the high demand and with some crops such as alfalfa, wheat and maize, which consume high amount of water. In the effort to conserve scarce water resources, the Kingdom has shifted towards becoming a net importer for these crops. As part of the mandate, ADF give preference to modern and high technology in farming by giving higher lending margin.

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Question 12 Page 84 Paragraph 4.21 of the Secretariat's report states that "the most recent notification to the WTO on agriculture support is for calendar year 2017" and that "important changes to support programmes since 2018 are therefore not yet covered". Could the Saudi delegation please inform the reasons for this delay in notification and when Saudi Arabia intends to submit updated information on domestic support in agriculture?

Answer To ensure updated information of the agricultural support policy will be covered in the Kingdom's domestic support notifications, as appropriate, and will be notified to the WTO upon the completion of all relevant data, in consistent with the WTO rules.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 13 The Brazilian government would like to commend Saudi Arabia for its determination to ensure harmonization among several different policy strategies. Within Saudi Arabia's food security strategy, MEWA has set goals for self-sufficiency in local agricultural production (e.g. poultry). Could the Saudi delegation clarify what are the Kingdom's agricultural self-sufficiency goals and the strategy for achieving them?

Answer According to the Kingdom's National Agriculture Strategy, self-sufficiency in agricultural products will be enhanced depending on the comparative advantage of production in the Kingdom's regions. Furthermore, KSA's Infrastructure capability building program aims to develop the required capabilities to support implementation of FS strategy, the program consists of nine key initiatives. of it: Develop KSA agriculture infrastructure development plan through design KSA agriculture infrastructure development plan and design public and private sector roles for different infrastructure projects. Develop KSA agriculture infrastructure projects through Incentivize private sector to develop agriculture infrastructure projects.

Question 14 Could the Saudi delegation explain how the Kingdom sees the potential to increase cooperation with food producing and exporting countries to achieve food security objectives through international trade?

Answer Increased cooperation with food producing and exporting countries will reduce exposure to market volatility, The Kingdom is looking forward to strengthening and enhancing its trade relations with its main trading partners.

BRAZIL – ADDITIONAL QUESTIONS

QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 I.

1. ECONOMIC DEVELOPMENT: MONETARY AND EXCHANGE RATE POLICY

Page 16 (Para 1.13) On 24 November 2020, the Council of Ministers approved a new law changing the name of Saudi Arabian Monetary Authority (SAMA) to the Saudi Central Bank, but keeping the SAMA abbreviation. Under the new law, SAMA is linked directly to the King of Saudi Arabia and will enjoy full financial and managerial independence. Also, under the new law, SAMA updated its mandate to include supporting economic growth as one of its prime objectives, formally changing its operating principles for the first time in more than 60 years. SAMA is vested with the conduct of monetary policy, and its key monetary policy objective remains the stability of the Saudi riyal (SAR) exchange rate in local and global markets, complemented by protecting the stability and resilience of the financial system, expanding and deepening the financial sector, and contributing to the economic development of the country. Saudi Arabia accepted the obligations of Article VIII of the IMF

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Agreement in the early 1960s. It has no restrictions on capital receipts or payments by residents or non-residents.

Is there a fixed mandate for the direction of the new Saudi Central Bank? If so, is there a limit to the number of possible renewals?

Answer Article (3) stipulated the objectives of the Saudi Central Bank as follows: 1- Maintaining monetary stability. 2- Supporting financial sector stability, and promoting confidence in it. 3- Supporting economic growth. In this regard, Article (4) provided that The central bank has all necessary powers to achieve its objectives mentioned on Article (3). There is no limit for this mandate. The central bank is authorized to suggest any amendment to the Law based on the approved procedures for amending laws in the Kingdom.

Question 2

Page 17 (Para 1.16) Based in Riyadh, the Gulf Monetary Council (GMCO) was founded in March 2010 as a regional economic organization. GMCO's membership is open only to countries of the Gulf Cooperation Council (GCC). In June 2009, the current GMCO members (the Kingdom of Bahrain, the State of Kuwait, Qatar, and Saudi Arabia) signed an agreement to form a monetary union; the agreement was ratified and entered into force in March 2010; however, the date for adoption of a single currency is yet to be determined.

What are the practical effects hitherto of this monetary union and what are the prospects of the monetary union until the next TPR?

Answer The Gulf Monetary Council GMCO member states continue to achieve and perform the primary objectives and tasks set for the establishment of monetary union. The meetings of the GMCO Board of Directors are held frequently at regular intervals and reached 52 by the end of 2020. Many objectives and projects are in process such as the enhancement of cooperation among National Central Banks is continuing with a view to creating appropriate conditions for the establishment of the Monetary Union, the development and coordination of the monetary policies and exchange rate policies for national currencies until establishment of the Central bank, and following up fulfilment of the Member States’ obligations to the Monetary Union and the introduction of single currency specifically those relates to the performance of the economic convergence criteria. The GCC Unified Payment System, which supports instant payment settlement, is one of the projects that will help in achieving monetary union. This project will allow GMCO to achieve the objectives set to prepare the technical infrastructure required for the establishment of monetary union and to ensure that payment and settlement systems support the single currency. The efforts made to achieve GCC monetary policy coordination continue with a comprehensive framework being developed for liquidity forecasting and management model for some member states' central banks. Additionally, the macroeconomic model, designed to examine the economies of the GCC countries and the impact of political challenges and emergency changes on the future of the economy, has been developed and improved regularly. Although GMCO is progressing and carrying out its tasks and functions to fulfil the Monetary Union requirements.

Question 3

1. ECONOMIC DEVELOPMENT: TRENDS AND PATTERNS IN FDI

Page 22 (Para 1.28) Moreover, in 2019, the Saudi Arabian General Investment Authority (SAGIA) was transformed into the Ministry of Investment (MISA) to add power and capacity to help increase Saudi Arabia's effectiveness in attracting local and foreign investments. MISA implemented, inter alia, the following reforms: reduced the foreign investment licence requirements to two documents; launched instant licence and renewal; automated post services (licence renewal, company activities amendment, adding branches); reduced the time to issue new licenses (from an average of 53 hours to less than 4 hours); and extended the validity of the foreign investment licence to five years (rather than being renewed annually).

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What were the main changes in licence procedures regarding financial services?

Answer The financial licensing procedures under the Saudi central Bank supervision could be found in the following link; https://www.sama.gov.sa/en-US/Laws/Pages/default.aspx. In addition to the above the following two documents (Copy of the CR and financial statement) are required by MISA as prior approval from SAMA to issue a foreign license for financial activities.

Question 4

3. TRADE POLICIES AND PRACTICES BY MEASURE: INTELECTUAL PROPERTY RIGHTS

Page 72 (Para 3.183) Under Vision 2030, Saudi Arabia is building innovation labs and platforms, and engaging in initiatives to encourage entrepreneurship. This approach was underpinned by the reforms undertaken in the IP administrative regime during the review period. For example, in 2020, the SAIP requested public consultations on a draft regulation for IP licensing, and launched a network of 33 IP support centres, and, in 2019, it began preparations for the development of a national IP strategy.

On the development of the National Strategy of Intellectual Property Work, could the Kingdom of Saudi Arabia share more details about its implementation? What is the procedure foreseen by the Kingdom for legislation approval? Is there a working plan of activities? Which are the difficulties faced so far and, how the pending issues are being resolved?

Answer National IP Strategy is being prepared along with the contribution of National stakeholders.

Question 5

What is the treatment given to the Health Sector within the scope of this Strategy?

Answer National IP Strategy is under consideration and being prepared along with National stakeholders.

Question 6

Page 72 (Para 3.185) On 26 October 2020, the SAIP organized the Global Intellectual Property Challenges Forum (IP20+) as an initiative in response to IP priorities in the times of global pandemics and emergencies. Participants of the Forum included the heads of IP offices operating in the G20 countries, WIPO, the World Health Organization, and a number of guests from other IP offices and international organizations.

Could the Kingdom of Saudi Arabia clarify if there will be any kind of continuity to the IP20+ Forum? If so, how the works will be organized?

Answer No decision has been made yet. However, as stated in the joint statement of The Global Intellectual Property Challenges Forum (IP20+), the Intellectual Property Offices operating in the G20 countries (IP20+), participated in the Global Intellectual Property Challenges Forum, share a willingness to consider future IP20+ meetings.

Question 7

Could the Kingdom of Saudi Arabia inform if there are plans for the participation of representatives of the Ministries of Health of the G20 countries?

Answer This question outside the scope of the TPR.

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Question 8

4. TRADE POLICIES BY SECTOR: BANKING

Page 107 (Para 4.106) With 97% of the financial sector assets, the banking sector dominates the financial services sector; banking sector assets represented 88.4% of GDP at the end of 2019, increasing from 76.2% in 2014. The number of banks licensed in Saudi Arabia increased from 23 in 2014 to 29 in 2020. There are currently 12 commercially licensed domestic banks and 17 licensed foreign bank branches, after the State Bank of India asked for the cancellation of its licence. Six of these 17 banks are branches of banks from other GCC member States. Four of the six banks that obtained licences over the review period have not yet started operations. Following the merger of the Saudi British Bank and the Alawwal Bank in 2019, the National Commercial Bank (64.3% state-controlled) and the Samba Financial Group (49.6% state-controlled) agreed to a merger in late 2020, which would create the Middle East's third-largest lender in asset terms.

What were the main impacts of recent regulatory changes on bank's leverage and portfolio?

Answer There are no recent changes in leverage-related regulations in Saudi Arabia. The requirements for leverage ratios, which apply to all banks operating in the Kingdom. Two leverage ratios exist; a ratio of Tier 1 capital to total exposures should equal a minimum of 3 percent in line with the Basel III framework, and the other ratio, under the Banking Control Law, states that bank’s deposit liabilities should not exceed 15 times its reserves and invested capital. In 2015, Saudi banks started reporting the (BCBS) leverage ratio, and since then, the ratio is well above the floor of 3 percent set by the BCBS.

Question 9

Page 108 (Para 4.109) While overall credit to the private sector increased by 10% between 2015 and 2019, retail and corporate real estate loans increased by 60%, from SAR 185 billion in 2015 to nearly SAR 300 billion in 2019; increased lending to retail customers accounted for the bulk of the increase. Real estate lending by non-bank institutions also increased, from less than SAR 12 billion in 2015 to more than SAR 20 billion in 2019 (around 41% of the total non-bank financial-sector credit). The FSDP explicitly targets strong growth in mortgages issued by the financial sector to SAR 500 billion in 2020.

Which body is responsible for the statistical survey of the quantity and volume of indebtedness for operations that do not pass through banking system?

Answer SAMA regulates and supervises the banking, insurance, finance, and money changers, and oversees the statistical information over the aforementioned sectors. Other financial statistics could be found within the relevant financial entities through websites or annual reports. In-depth statistics are available in SAMA’s annual reports that can be accessed here (https://www.sama.gov.sa/en- us/economicreports/pages/annualreport.aspx).

Question 10

Page 109 (Para 4.113) Foreign banks continue to be allowed to operate in Saudi Arabia, either as a locally incorporated joint-stock company or as a branch of an international bank. In 2019, the SAMA issued revised licensing guidelines for banks under the Banking Control Law, 1966, which remains the main legislative text governing the banking sector. Under the guidelines, foreign bank branches are, in principle, subject to the same prudential requirements as locally incorporated banks. Foreign bank branches are not required to maintain capital in Saudi Arabia but, under certain circumstances, the SAMA reserves the right to impose such capital requirements. The guidelines require preliminary discussions prior to submitting a licence application for review to the SAMA. The Regulations for Foreign Bank Branches were published in September 2019 in Circular No. 4922/67, and the SAMA also regulated "agent banking" in 2019. In 2020, the SAMA issued additional guidelines for digital-only banks, requiring such banks to be set up as incorporated joint-stock companies, to have a physical presence in the country, and to put in place adequate customer support.

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Is there a restriction on industry or customer profile for each type of financial institution?

Answer Each type of financial institution is governed by its regulatory framework as indicated in this paragraph, further information could be found in the following link https://www.sama.gov.sa/en- US/Laws/Pages/default.aspx.

Question 11

Page 110 (Para 4.116) Following the establishment of CMA's FinTech Lab initiative in December 2017, the SAMA launched a "regulatory sandbox" in 2018 to facilitate the testing of innovative FinTech products. By September 2020, 32 FinTech companies had joined and, by March 2020, FinTech licences had been issued to four companies, all of which had participated in the sandbox. With the objective of expanding the variety of financial services available, the FSDP aimed to increase the number of licensed FinTech players to at least three by 2020, a target that was exceeded.

Are these FinTechs also allowed to perform cross-border operations?

Answer The licensed Fintech firms could provide cross-border operations subject to regulatory and supervisory requirements in the kingdom’s as well as in the host jurisdictions.

Question 12

How will the FinTechs operate in the new monetary union? Will there be any restrictions?

Answer The Gulf Monetary Council GMCO member states continue to achieve and perform the primary objectives and tasks set for the establishment of monetary union. In The Secretariat General of the GCC, a specialized Fintech working group under the Governors of Central Banks Committee is discussing the Fintech related issues including its regulatory framework.

Question 13

4. TRADE POLICIES BY SECTOR: TELECOMMUNICATIONS

Page 114 (Para 4.136) Saudi Arabia (like other GCC member States) was an early adopter of 5G, and two operators (STC and Zain) launched 5G networks in 2019, while the third (Mobily) launched one in 2020.

Considering 5G early adoption in Saudi Arabia, how did the country address the lack of information regarding new services and applications of the next generation? What pricing methodologies did Saudi Arabia determine for the different spectrum bands licensed?

Answer Among other duties and mandates, CITC, the ICT regulator in Saudi, is mandated to enable and facilitate the adoption of new technologies to harness the ICTs potential. As for the rollout of 5G networks it is a commercial decision taken by the operators based on their own strategic and ROI objectives. Regarding spectrum pricing methodologies used, Saudi auctioned the spectrum among service providers in blocks of contiguous spectrum.

Question 14

Page 114 (Para 4.137) For the STC, a dominant service provider in the market, tariff increases and price changes that do not pass a cost-related test require retail Tariff approval by the CITC, while other price changes by the dominant service provider and all changes by other providers need to be notified to and can be rejected by the CITC for reasons of price discrimination or anti-competitive pricing.

Could Saudi Arabia detail the methodology of the test required for tariff increases and price changes?

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Answer The test has two angles; one is the cost of offering the service to the public excluding any overhead due to the company operations or what is known as pure LIRC. The second is the current prices in the market to ensure no price discrimination or anti-competitive pricing is performed by the dominant operator or any operator in the market.

Question 15

Could Saudi Arabia elaborate on the process and criteria established to define dominant service providers?

Answer ICT regulator, CITC, is among the most mature regulators worldwide and follows the world best practices globally. Regarding defining dominant service providers, CITC carry out and extensive regulatory task of assessing Market Definition, Designation and Dominance “MDDD” based on the competitive dynamics in the country and shares the results with the public through a public consultation. One of the outcomes of his task is the identification of dominant operators.

Question 16

Page 115 (Para 4.140) The licensing framework consists of two types of telecommunication licences: Facility-Based Provider (FBP) individual licences and multiple "class licences". Individual licences include a technology- and service-neutral unified licence193 (introduced in 2016, three issued194), a fixed services licence (two issued), and a data service provider licence (one issued). Class licences are issued to authorize more than one service-based provider to offer specific services, imposing identical conditions on all licensees for the specific service authorized. Where specific telecom services are covered by class licences, FBPs are also required to obtain relevant class licences before offering such service(s). The CITC is permitted to limit the number of some class licences and allocate them using defined procedures (Class A)195, while other licences (Class B) may not be restricted in number or allocated competitively.196 Given technical developments and past incremental changes to the licensing framework, the CITC started to review the licensing regime more generally in 2018 in order to align it with international best practices. Following public consultations in 2019197, the CITC aims to introduce a new licensing framework in 2021, which would consist of: (i) individual licences (including unified, wholesale, and carrier service provider licences); and (ii) a general class licence. Existing licences will be transferred to the new framework. Portability has been available for mobile numbers since 2006 and for fixed numbers since the third quarter of 2020.

Can the Kingdom of Saudi Arabia give more information regarding licensing framework? Can either the service-neutral unified licence or the Facility-Based Provider incentivize the development of the supply on the telecom market of the Open-RAN model and the 5G standalone service architecture? If yes, how so.

Answer Incentivize the development of the supply on the telecom market of the Open-RAN model or the 5G standalone service architecture is for the operators to decide on. The Saudi Arabia ICT regulator, CITC leave such decision to the market players due to the impact of such decision on the internal operations of the services operators.

Question 17

Page 116 (Para 4.142) The regulatory environment provides for the sharing of physical infrastructure199, and in January 2016, the CITC issued revised guidelines for access to physical facilities. 200 The guidelines provide the basis for mutually agreed access agreements and set out rules for requesting access to telecom infrastructure and passive network elements. Facility owners are required to respond to such requests and provide negotiated access with few exceptions, and the guidelines also require the dominant service provider to provide a Reference Access Offer if requested by the CITC. In 2018, the CITC issued Rules for ICT Infrastructure Provision and Deployment in New Developments, encouraging coordination among stakeholders for the roll-out of ICT infrastructure and promoting competition in the provision of ICT infrastructure and services. 201 The CITC also launched a new licence for the provision of wholesale infrastructure services in 2018202, and issued guidelines and

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- 14 - rules for Fiber Wholesale Bitstream Access Agreements in 2019. 203 In mid-2020, based on these guidelines, an open access agreement among all telecom service providers for the provision of fibre- to-the-home broadband services independent of fibre infrastructure ownership entered into force, covering over 3.5 million households.

Infrastructure sharing is critical for the deployment of service in certain areas. Given that, can the Kingdom of Saudi Arabia supply additional information regarding spectrum sharing in their regulatory regime?

Answer The Saudi Arabia ICT regulator, CITC has issued guidelines to provide the basis for mutually agreed access agreements and set out rules for requesting access to telecom infrastructure and passive network elements. However, due to the criticality of spectrum availability to the operation of service providers, CITC has made available the spectrum to each operator and in fact Saudi Arabia is ranked 2nd among G20 countries in spectrum allocation and licensing to the operators. Moreover, spectrum trading is allowed among service providers and CITC has recently (2021) issued a public consultation on “Spectrum Outlook for Commercial and Innovative Use 2021-2023" which comprises of a plan to release more than 20 GHz of additional radio spectrum, with the aim of promoting further innovation and investment in multiple wireless technologies within the Kingdom's commercial sector.

II QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 18

2. ECONOMIC DEVELOPMENT Page 07 (Para 2.8) The continued upward trend of non-oil revenues reflects increased fiscal stability and also a positive future outlook for foreign investors. Moreover, the non-oil sectors including manufacturing and renewable energy sectors continue to drive growth. Small and medium-sized enterprises (SMEs) are a main focus for Vision 2030, with the project seeks to increase the contribution of SMEs to the Kingdom's GDP from 20 to 35% over the next decade.

What are the main sectors of these SMEs companies? Does that definition also include Fintechs?

Answer The National Classification for the Economic Activities is derived from the International Standard Industrial Classification of All Economic Activities, forth version (ISIC4). Hence, wholesale, retail and construction accounts for almost 50% of existing base. FinTech’s and other emerging sectors are among the kingdom’s future focus to enable and grow.

Question 19 Page 08 (Para 2.12) In parallel with the development of this strategic framework, NCP supported the main economic sectors in preparing and implementing specific transactions. In 2019 seven PPP tenders were closed, these included three new wastewater treatment plants, two new water desalination plants and a new container terminal at Jeddah Port. The first strategic privatization sale of the Saudi Medical Service was completed.

Are there sectorial restrictions of where will private capital be allowed or shall this definition occur on an ad hoc basis?

Answer Generally, there are no sectorial restrictions. However, each privatization opportunity is being studied and discussed as a separate case.

Question 20

4. SECTORAL DEVELOPMENTS : ENVIRONMENT Page 15 (Para 4.11) The precedent environmental laws were replaced with a new law and a set of executive regulations, standards, requirements and guidelines that aim to protect, develop and sustain the environment.

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On the regional level, the final drafts of a unified GCC environmental and meteorological law, and an operational plan for the GCC environment strategy were developed.

What, if any, regulatory standards have been implemented to encourage financing of sustainable projects?

Answer There are no special regulatory standards have been implemented or dedicated to encourage financing of sustainable projects so far, however, the establishment of the components of the new institutional framework for the environment sector has been approved to enhance sustainable development by focusing more on the control and compliance related aspects.

Question 21

IV. SECTORAL DEVELOPMENTS: FINANCIAL SERVICES Page 19 (Para 4.45) The FSDP which was launched in April 2017, to create a thriving financial sector. This program envisions expanding financial inclusion, achieving high degree of digitization and maintaining financial stability. The Saudi Central Bank2 (SAMA), in partnership with MoF and the Capital Market Authority (CMA), has been working to support the implementation of initiatives falling under FSDP. It has contributed to the development and implementation of many initiatives related to the banking sector, insurance sector, finance sector, payment systems and consumer protection.

What financial education measures were adopted to avoid that this growth in financial inclusion does not resulting in an increase in household excessive indebtedness?

Answer One of the FSDP pillars is to promote and enable financial planning under which 9 core initiatives have been launched, including the strategy for the Financial Literacy Entity which has been finalized to promote and enable financial planning.

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CANADA

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 Page 7 (Para.4) While a comprehensive assessment of progress made towards achievement of the Vision 2030 objectives is beyond the scope of this Review, results in certain areas are noteworthy. For example, prior to the COVID-19 pandemic, the fiscal deficit declined from 15.8% in 2015 to 4.5% in 2019 due to significant progress in diversifying and stabilizing the Government's revenues. Measures adopted by the Government in matters such as starting a business, registering property, and protecting minority investors appear to have significantly improved the business climate. At the same time, there remain governance and rule of law issues that may warrant reform. Illustrative in this respect is the IMF's recent call for continuing reforms to enhance fiscal transparency to reduce the risks of corruption. During the review period, the Government also introduced reforms concerning the status of women in society."

Could Saudi Arabia provide examples of the reforms that were introduced concerning the status of women in society?

Answer The Council of Ministers issued a new travel documents law in July 2019 lifting restrictions on women travel. Under the new law, women do not need a travel permit and may apply for their passports independently. Both men and women are equal under the new law and are subject to the same treatment. The Kingdom has lifted the ban on women mobility, granted them the right to independently open and run a business with equal access to credit. The Saudi government adopted a law to protect them against harassment in public spaces including cyber-harassment. The Saudi government introduced strong protections in the workplace against discrimination based on gender, notably during recruitment, employment and in setting wages. The protections also guard against dismissal during pregnancy and expanded the opportunities for them to occupy senior government positions, including as deputy/assistant ministers and as ambassadors.

Question 2 Do any of these reforms include programs and/or initiatives to support women-owned businesses and their integration into international trade?

Answer More reforms have been introduced recently to eliminate barriers for women and enable them to work on all sectors without restrictions on night work and hazardous occupations.

In the social sphere, women have been granted the right to attend sports events, engage in sports, participate in international competitions, and access entertainment opportunities.

Women are an invaluable asset for the Kingdom. Their knowledge, skills and capabilities are one of the most powerful competitive advantages that the country possesses. The government is committed to making them a pillar of social and economic transformation under Vision 2030.

There have been great efforts from the Saudi Government to scale local businesses, the General Authority for Small and Medium Enterprises launched initiatives to enable entrepreneurs' access to international markets through local/global franchise and Unicorn Development. In addition, "Tomooh" program to supports SMEs with growth potential to elevate their capabilities and integrate them into global markets.

Question 3 Page 10 (Para.17) "As part of its accession commitments, Saudi Arabia agreed to start negotiations to join the Government Procurement Agreement (GPA) at a future date. Presently, it is an observer to the GPA."

Does Saudi Arabia currently have plans to begin negotiations in order to join the Government Procurement Agreement?

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Answer At the time of Saudi Arabia's accession to the WTO and its confirmation to initiate negotiations for the membership in the Agreement on Government Procurement by tabling an entity offer and the condition that, if the results of the negotiations were satisfactory to the interests of Saudi Arabia and the other Parties to the Agreement, Saudi Arabia would complete negotiations for membership in the Agreement. It is worth mentioning that the said confirmation by Saudi representative at that time pertains and was specific to a previous version of the Agreement.

Question 4 Page 10 (Para.21) The Secretariat Report states that Vision 2030 is expected to transform Saudi Arabia's oil and gas sector through increased localization, increased gas capacity, enhancing competitiveness, and increasing the share of renewables in the energy mix. What are Saudi Arabia's plans for integrating environmental, social, and corporate governance (ESG) investment criteria into its oil trade investments domestically and abroad, including for Saudi Aramco?

Answer Saudi Arabia encourages a holistic ESG approach.

Question 5 What investments or measures will Saudi Arabia pursue in order to ensure markets access for its exports in an increasingly carbon constrained global market?

Answer Saudi Arabia will take the lead on research, development and deployment of innovations and technologies to address all GHG constraint global market.

Question 6 Page 13 (Para 1.2) "GDP per capita increased from USD 21,180 in 2015 to USD 23,174 in 2019. Saudi Arabia had a population of around 34.2 million in 2019, of which 38.3% (13.1 million) were non-Saudis. Expatriate labour accounts for 79.4% of private sector employment.1 The unemployment rate of Saudi nationals remained high at 12.0% in 2019, while for non-Saudis it was 0.4%.2 With a view to increasing the employment of nationals, notably women, the authorities have been implementing the Nitaqat programme since 2011. It is a labour market reform strategy designed to make Saudi nationals more competitive in the private sector labour market, make private sector jobs more attractive to nationals, and require or encourage private firms to meet certain Saudization quotas. As from 14 March 2021, Saudi Arabia will allow foreign workers in the private sector to change jobs and leave the country without an employer's consent."

Does Saudi Arabia collect data on the employment of nationals disaggregated by sex?

Answer Yes.

Question 7 If so, of the 12.0% Saudi nationals who were unemployed in 2019, what was the ratio of women?

Answer The ratio of unemployed who are women is 83%.

Question 8 Can Saudi Arabia provide data on some of the achievements to date for the Nitagat program in increasing the employment of women?

Answer Since its launch, Saudi male workforce registered under Nitaqat grew by 8.4% while the Saudi female workforce grew by 51.5%, which is significantly higher and shows the positive impact Nitaqat had on female employment.

Question 9 Page 17 (Para 1.17) "As part of its role in preserving financial stability and helping the Government's efforts to combat the COVID-19 pandemic, SAMA injected over SAR 51 billion into the banking sector

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- 18 - as at August 2020. To support banking liquidity and enable banks to continue providing credit facilities for the private sector, especially SMEs, the Private Sector Financing Support Program includes the Deferred Payments Program (extended in September until December 2020), the Funding for Lending Program, the Loan Guarantee Program, and support of point-of-sale and e-commerce transaction fees for the private sector."

Could Saudi Arabia provide data on the percentage of small and medium-sized businesses who benefitted from the Private Sector Financing Support Program, including the Funding for Lending Program and the Loan Guarantee program?

Answer All three programs under SAMA's Private Financing Support Program are directed to SME's (i.e. Deferred Payment Program, Funding for lending (the name was changed to guaranteed loan program) and the Loan Guarantee program). For more information, Kindly Refer to: https://www.sama.gov.sa/en-US/News/Pages/news- 514.aspx In addition, the total value of the support has changed following the extension of the Deferred Payment Program. For more information, Kindly Refer to: https://www.sama.gov.sa/en-US/News/Pages/news- 631.aspx

Question 10 The Secretariat report mentions that Saudi Arabia seeks to attract investment projects to, notably, promote foreign technology and expertise transfers.

Could Saudi Arabia provide additional information on whether or not it requires foreign investors or businesses to share intangible assets (e.g. intellectual property, technologies, training materials) with local joint-venture partners, state-owned enterprises, or other Saudi entities as a condition for approving or maintaining commercial activities in Saudi Arabia?

Answer The Kingdom of Saudi Arabia does not require investors or foreign companies to share intangible property (e.g. intellectual property, technologies, training materials) with local joint-venture partners, since this is considered an investment decision to be made by investment partners once they reach an agreement on it.

Question 11 "According to the report, Saudi Arabia does not maintain any export prohibitions/restrictions that target specific trading partners." Could Saudi Arabia confirm: a- that this statement applies to the export of strategic and military items; and b- that Saudi Arabia does not maintain destination-based restrictions on the export of such items?

Answer a- By default, most countries including Saudi Arabia, apply export controls on strategic and military items. b- Saudi Arabia maintains destination-based controls on the export and re-export of such items, in alignment with relevant UN agreements, decisions and resolutions.

Question 12 The table identifies categories of goods that require export licences and the relevant licensing authority, but there is no mention of military and strategic items (unlike paragraph 3.55 and Table A3.1 which detailed items subject to import licencing.)

Could Saudi Arabia please confirm if there are any licences required for the export of military and strategic items?

Answer Kindly refer to answer of question (11-a).

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Question 13 If so, could Saudi Arabia please provide details of its export licensing requirements for these types of goods as well as the relevant licencing authority?

Answer Currently, the licensing requirements of these types of goods remains unchanged since the Kingdom's accession to the WTO. These requirements are reviewed in periodic basis by the relevant authority.

Question 14 If available, could Saudi Arabia also include links to the relevant laws and regulations?

Answer Following the recent establishment of the General Authority for Military Industries (GAMI), GAMI has recently taken on the role of coordinating applications for export approvals for military items.

Question 15 Currently, The Economic cities and special zone authority (ECZA) are in the process of approving three SEZs: Ras Al-Khair Industrial City, located in the Eastern Province and operated by the Royal Commission for Jubail and Yanbu. It will create a global complex for marine industries and services, including manufacturing and ship servicing and marine oil platforms. In addition to the International Maritime Industry's new shipyard, could Saudi Arabia elaborate on what other facilities will be constructed at the "global complex for marine industries"?

Answer It is a maritime complex, where ship building and maintenance and platform building will be the main sectors. The upstream and downstream of these industries are also targeted in the zone to create the sector's full value chain.

Question 16 In addition to the general tax policies and other incentives that are applied to all SEZs (e.g. reduced restrictions on business loans, simplified visa and work permit processes, etc.), could Saudi Arabia elaborate on what other incentives may be applied to the "global complex for marine industries"?

Answer 16- ECZA offers various types of incentives such as regulatory and administrative, in addition to the incentives currently being offered in the Base Economy.

Question 17 "Under Vision 2030, Saudi Arabia aims to increase the contribution of SMEs in GDP from 20% to 35% and encourage local financial institutions to allocate up to 20% of overall funding to SMEs by 2030. With this objective in mind, the SME Authority (Monshaat) was established in 2016 to: (i) reform the basic needs of SMEs, and to create an environment that provides prosperity opportunities for all SMEs; (ii) provide support services and business opportunities to enhance the growth of all SMEs and enhance their competitiveness; and (iii) create a society that supports and motivates members to engage in entrepreneurial endeavours and opportunities." How does the Government plan to support the expansion of SMEs' contribution to GDP from 20% to 35% by 2030?

a. Could Saudi Arabia provide examples of policies and programs being implemented to increase the growth and competitiveness of SMEs? b. Does Saudi Arabia intend to target different types of SMEs, such as those owned/led by women or youth?

Question 18 Could Saudi Arabia provide additional information on achievements of the SME Authority (Monshaat) to date?

Answer Monshaat has been mandated to raise SME's contribution in GDP from 20% to 35%, since its launch in 2017 to date, Monshaat established a number of programs to achieve this objective.

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- 20 - a. Several achievements have been accomplished on different initiatives types such as:

Access to Finance: • Establishing the SME Bank. • Launching SME's Funding Platform - an online platform that connects commercial banks and NBFIs with MSMEs, and enables them to choose the appropriate financing offers. • Establishing the Saudi Venture Capital company - a Government VC established in 2018 by Monshaat to stimulate venture investments in funds as well as co-investing with angel groups for the primary goal of minimizing equity financing gaps for startups by investing SAR 2.8 Billion ($750 Million).

Ease of Doing Business: • Issuance of laws: franchise, ecommerce, bankruptcy, government procurement.

Business Support: • Established SME support centers in 3 regions, Strat-up Hubs and innovation centers on IoT & cybersecurity and AI. • 100+ coworking spaces licensed and operated. • Launching a tailored scale-up programs for high-growth-SMEs. • Launch "Nawafth" an application that provide business consultancy and guidance for SMEs. b. Yes it does target different types of SMEs, example of programs that target business led by women or youth are: Women in Business Network, and Universities Start-ups support program

Question 19 The report notes the numerous notifications and addenda submitted during the review period regarding Saudi Arabia's sanitary and phytosanitary measures. Does Saudi Arabia have any planned upcoming sanitary and phytosanitary regulatory initiatives not specifically referenced in the TPR reports that will impact agriculture, forestry, or aquatic product imports?

Answer Saudi Arabia is updating Agricultural and veterinary quarantine laws and its executive by-laws, also reviewing and updating regulated lists of quarantine and non-quarantine pests. In addition, Saudi Arabia is updating ban and ban lifting procedures in accordance with the OIE updates. Furthermore, Saudi Arabia updates food and food products standards periodically.

Question 20 The Secretariat Report describes Saudi Arabia's General Authority for Competition (GAC) as permitting exemptions to entities from the application of provisions under the new Competition Law, "if such exemptions would lead to improved market performance" as determined on recommendation by a technical committee formed for such a purpose. Could Saudi Arabia provide more information on the process for convening such a technical committee (e.g. how are its members selected, what timeframe do they have to provide reports);

Question 21 Could Saudi Arabia provide the criteria that will be used to determine improvements in market performance?

Question 22 Could Saudi Arabia provide examples of decisions rendered by such technical committees?

Answer to Questions 20, 21 and 22 There are instances where the GAC initially finds anticompetitive measures that constitute a violation of Articles 5, 6, or 7 of the Competition Law. Such violations may be appealed within 30 days from the date the violator is notified of the decision. The violator may request that a technical committee be formed to analyze if the behavior should be exempt from the Competition Law for reasons that the behavior leads to improved market performance, despite the initial finding of a violation. Reasons for finding that there is improved market performance may include a finding that the behavior generates economic efficiencies, similarly to other jurisdictions. The technical committee consists of an internal selection of different economists and lawyers depending on the case to evaluate the initial violation where improved market performance or performance of entities can be proved. This

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- 21 - procedure is not often invoked. A recent example of this rare circumstance has been the technical committee that investigated the decision of a certain company to print their prices on their products as to whether it is attempting to collude with their competitors for price setting or an attempt to apply retail price maintenance.

Question 23 "On 16 July 2019, the Council of Ministers approved the new Government Tenders and Procurement Law (GTPL) by Royal Decree No. M/128 of 1440H. It supersedes most of the previous GTPL issued under Royal Decree No. M/58 dated 04/09/1427H. The key objective of the new Law, which came into force on 1 December 2019, is to strengthen government procurement activities while protecting public funds and enhancing economic development, with an emphasis on integrity, fair competition, and transparency." Could Saudi Arabia describe how this new law increases transparency in government procurement practices?

Answer Please refer to article 2 of the GTPL that sets out the goals of the GTPL, it states that the GTPL aims to strengthening intergrity and competition, achieving equality.

Question 24 "According to the authorities, preferences related to local content are currently under discussion as to whether to apply them to commercial companies in which the State owns more than 51% of the share capital." Could Saudi Arabia elaborate on these discussions, including whether an outcome has been achieved and its content or, if no outcome has been achieved yet, could Saudi Arabia elaborate on the timeframe expected to conclude those discussions and arrive to an outcome?

Answer The mentioned preferences related to the local content are still under discssion.

Question 25 "The Ministry of Finance is creating and implementing a unified web-based portal, called the ETIMAD, for government procurement efforts. The procedures for all tenders and procurement by governmental entities are to be posted on the ETIMAD, along with electronic versions of the tender documents, except for reasons relating to national security or technical reasons that prevent such posting. The Ministry of Finance will also compile and publish on the ETIMAD a list of "blocked" or "blacklisted" persons. The ETIMAD is expected to enable greater integration through the sharing of data on procurement activities among governmental bodies including the LCGPA, the General Authority for Zakat and Tax, and the Ministry of Human Resource and Social Development." Could Saudi Arabia elaborate on the expected timeframe for the implementation of this web-based portal?

Answer MoF, through Government Resource System Program, is targeting ETIMAD to be integrated with other governmental entities such as LCGPA during 2021. ETIMAD is already integrated with the General Authority for Zakat and Tax.

Question 26 This paragraph describes the role of the Entity in Charge of Unified Procurement (ECUP) and the associated procurement regime. It indicates that the General Authority for Military Industries, the body in charge of procurement in the defence sector, is partly exempt from the ECUP procurement regime. Could Saudi Arabia provide details on the procurement exemptions applicable to the General Authority for Military Industries?

Answer Trade in military and defense products are outside the scope of WTO.

Question 27 Per the Secretariat's Report, since 2018, the SAIP's main roles and responsibilities include preparing and implementing the national strategy for IP; proposing IP laws and regulations; managing

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IP registration, grants, and enforcement; and providing opinions on international and regional organizations, among others. Recognizing the extensive mandate of Saudi Authority for Intellectual Property (SAIP), could Saudi Arabia provide information on whether there are areas of IP policy, implementation, or enforcement that are covered by entities outside of the SAIP?

Answer SAIP is the competent authority to supervise and monitor implantations of IP policy as well as prosing IP polices to the legislation body in KSA. Concerning the enforcement, there are several entities that are responsible for IP enforcement such as SAIP for Copyright, Ministry of Commerce for Trademark currently. Customs for border measures, and the court for disputes.

Question 28 Per the Secretariat Report, "Under Vision 2030, Saudi Arabia is building innovation labs and platforms, and engaging in initiatives to encourage entrepreneurship," which includes launching a network of IP support centres and developing a national IP strategy. Could Saudi Arabia elaborate on the initiatives developed under its National IP Strategy, and on how they have been implemented thus far?

Question 29 Has the SAIP received feedback from stakeholders on the efficacy of these initiatives?

Answer to Questions 28 and 29 National IP Strategy is still under study and preparation among National stakeholders.

Question 30 Page 72 (Para 3.184) Per the Secretariat Report, the SAIP implemented a number of COVID-19- related measures in 2020, including 19,990 different actions via its virtual platforms, over 17,000 actions to individuals and institutional customers, and organizing 44 sessions of quasi-judicial committees to adjudicated IP rights violations. Could Saudi Arabia provide additional information on the types of measures and actions the SAIP undertook in 2020 in relation to COVID-19, including the 19,990 different actions via virtual platforms, and over 17,000 actions to individuals and institutional customers?

Answer SAIP had extended its services via its virtual platforms in upon the national lockdown and the closing of its physical offices by activating the business continuity plan. Also, SAIP announced in March 27, 2020 the extension of deadlines until May 3, 2020 and allowed the utilization of its e-services to complete all transactions remotely.

Question 31 Page 74 (Para 3.193) Per the Secretariat Report, "any person within the territorial jurisdiction of Saudi Arabia who infringes copyrighted worked on the Internet shall be subject to one or more of the following penalties, including: (i) a warning; (ii) a fine not exceeding SAR 250,000; (iii) closure of the establishment that participated in the infringement for a period not exceeding two months; (iv) confiscation of all copies of the work in addition to the materials used, or intended for use, in the infringing acts; or (v) imprisonment for a period not exceeding six months (Article 22 of the Copyright Law)." Could Saudi Arabia provide additional information on the thresholds governing which of these penalties may be deployed?

Answer The determination of the maximum or minimum penalties depends on varies factors determined by the court.

Question 32 Page 82 (Para. 4.13) Paragraph 4.13 of the secretariat report notes that "as part of the COVID-19 response, the authorities also increased tariffs on certain agricultural products, such as dairy products, juices, and vegetable and olive oils, in June 2020." Paragraph 19 of the summary (page 10) also notes that Saudi Arabia is a major net importer of agricultural products.

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Could Saudi Arabia clarify the reason behind this increase in tariffs on certain agricultural products during the COVID-19 pandemic?

Answer On 20 June 2020, the Kingdom of Saudi Arabia increased customs duties on 575 goods. They were diverse, including dairy products. The vegetables, as well as olive oil were not among the above products. The reason behind raising tariffs was to increase customs revenues. 17- Raising the tariffs to the bound rates is a legitimate Member's right and it is not limited to a time frame.

Question 33 Could Saudi Arabia indicate how long it expects these increased import tariff rates to be in place for agricultural products, including with regard to dairy products, juices and vegetables?

Answer Raising the tariffs to the bound rates is a legitimate Member's right and it is not limited to a time frame.

Question 34 Page 82 (Para. 4.16 and 4.17) Paragraph 4.16 of the secretariat report notes, "In July 2020, divestment of the first two milling companies was completed, accounting for about 50% of the total milling capacity of 4.55 million metric tonnes per year. Privatization of all companies is expected to be complete by 2021. Companies will directly buy wheat for milling from SAGO before selling flour at subsidized prices in the Kingdom (Table 3.11). Based on the final regulated price of wheat flour, SAGO determines prices for the sale of imported and domestic wheat to mills, considering "acceptable profit margins" of milling companies". Paragraph 4.17 of the secretariat report notes, "SAGO is the only authorized buyer for domestic wheat and the sole authorized importer of wheat, although private flour mills will be able to apply for import licenses from SAGO in the future". Could Saudi Arabia provide an update on the progress of privatization of its milling companies and its efforts to offer import licenses to private flour mills?

Answer As mentioned in the secretariate report The second phase of mills Privatization process is ongoing and is expected to be completed by 2021.

Question 35 Could Saudi Arabia elaborate on its process to determine prices of wheat in sales to milling companies?

Answer The price is determined mainly based on the cost of Wheat procurement and the international prices for wheat.

Question 36 Page 83 (Para 4.19) "The ADF provides interest-free loans, including repayment subsidies: (i) to small farmers and medium-sized enterprises growing specialty products; (ii) to importers of products related to food security through the Agricultural Products Import Finance Program19; and (iii) for Saudi investments in priority crops abroad under the Agricultural Investment Abroad (AIA) Program. Loans cover investment costs to varying degrees, depending on the size of the investment and with projects using modern technologies or those implemented by joint-stock companies being eligible for a higher financing share. As a result of the COVID-19 pandemic, additional funds were allocated to food-security-related import programmes, to support SMEs with working capital loans, and to reschedule existing loans to SMEs to alleviate liquidity issues. The number and value of ADF loans have declined since 2015, while overall subsidies increased and approved loans in 2019 increased sharply (Table 4.5)." Does Saudi Arabia collect sex-disaggregated data on those companies which received interest-free loans/repayment subsidies?

Question 37 Do women have a good success rate in obtaining financing?

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Question 38 If so, what is that success rate?

Answer to Questions 36, 37 and 38 ADF did not have sex-disaggregated data on the COVID-19 related funds as ADF evaluate all loan without gender bias. ADF have a thorough evaluation on any loan application to ensure that they are based on the viability of the project and good repayment capability. The evaluation methodology is based on several factors such as sector demand, financial strength, risk involved and the return on the project. This methodology applies to all applicant disregards their gender.

Question 39 Page 84 (Para. 4.19 and 4.20) Paragraph 4.19. in the secretariat report notes, "the Agricultural Development Fund (ADF) provides interest-free loans, including repayment subsidies…for Saudi investments in priority crops abroad under the Agricultural Investment Abroad (AIA) Program." Paragraph 4.20. in the secretariat report notes that "the Agricultural Investment Abroad Program was set up in June 2019 to support the goal of enhancing food security outlined under Vision 2030. It builds on King Abdullah's Initiative for Saudi Agricultural Investment Abroad and provides long-term loans to Saudi nationals investing abroad in priority crops (i.e. green fodder, corn, edible oil, sugar, soybeans and barley) with the objective of importing them into the Kingdom for enhanced food security." Could Saudi Arabia elaborate on the share of agricultural imports of the priority crops that are the result of investments made by the Agricultural Investment Abroad Program?

Answer The share of imports resulting from these investments are 426,874 ton of various essential crops.

Question 40 What is the expected share of imports resulting from these investments by 2030?

Answer Currently estimates for the share of imports from these investments by 2030 is not available.

Question 41 Page 89 (Para 4.32) According to the Secretariat report, Saudi Arabia's mining sector is open to private investors, without discrimination between domestic and foreign firms. In addition, licenses are granted on a "first-come, first-served basis, subject to technical and financial evaluation." Could Saudi Arabia clarify the criteria and thresholds used in its technical and financial evaluation of the aforementioned licensing requests?

Answer For mining activities licensing, the ministry issues 4 different licenses, which are: Reconnaissance license, Exploration license, Building materials license, and Mining/Small mine license. The criteria and thresholds used in its technical and financial evaluation of the licensing are different based on each license's requirements. Some of the requirements are mainly summarized in the following:

Technical requirements:

- Related experience in earth sciences, or in mining activities. - Registered company in Saudi Arabia. - Should present the objectives, proposed working program for execution, and the detailed annual costs for the program. - Provide an economic feasibility study for the project. - Should not have a previous license that was terminated within the last three years. - Financial requirements: - Acommitment to provide funds of 100% to cover the costs of the proposed working program for the first year. - To disclose not declared bankruptcy.

Question 42 Page 91 (Para 4.39) The Secretariat report notes that Saudi Arabia's economic growth, fiscal revenues, and export revenues depend highly on oil, which will bring significant policy challenges in the future due to predicted long-term changes in the world oil market.

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What strategies are being deployed to address these policy challenges, including to improve the environmental performance of the sector in adapting to longer-term changes (e.g. strategies to reduce methane and other harmful emissions)?

Answer Vision 2030 is geared to diversify sources of economic sectors such as industries, mining, tourism, among others, while being cognizant of environmental performance.

Question 43 What policies or approaches is Saudi Arabia considering or has put in place to encourage the uptake of innovative technologies from its trading partners in the reduction of emissions?

Answer Saudi Arabia is adopting the Circular Carbon Economy (CCE) approach that will advance all technological innovations in addressing all GHGs from all sectors while capitalizing on value added as business opportunities

Question 44 Page 99 (Para 4.74) The Secretariat Report notes that Saudi Arabia aims to "to increase the level of competition in the electricity market by allowing multiple independent power producers (IPPs)." Can Saudi Arabia provide more details on its plan to open the utilities market to competition and clarify any potential restrictions or requirements vis-à-vis foreign bidders?

Answer The Saudi market is open for investors in all power sector projects including generation (thermal and renewable), transmission and distribution. In fact, all new power plants, including renewables, now in Saudi Arabia are built through IPPs where Local and international developers are invited and encouraged to participate.

Question 45 Page 106 (Para. 4.104) "[…] the financial sector is seen as essential, allowing the private sector to drive the diversification and development of the economy." Are there any foreign equity caps or restrictions in the banking, Islamic banking, insurance or securities sectors?

Answer The financial sector is very liberal and attractive to foreign investment with strong foreign participation as for foreign equity share it fully comply with KSA's Services Schedule of Specific Commitments.

Question 46 If so, what are these caps or restrictions?

Answer As indicated in KSA's Services Schedule of Specific Commitments.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 47 Page 7 (Para 1.26) "Women empowerment in Saudi Arabia is one of Saudi Vision 2030's main pillars. The economic empowerment of Saudi women is among the top priorities of the reform plan, which sets out a commitment to increase female participation in the workforce from an average of just under 20% to over 30% by 2030. Saudi Arabia has become recognized in terms of improvement and progress toward gender equality since 2017. Saudi Arabia has become one of the leaders in the region in terms of women empowerment." Could Saudi Arabia identify some of the challenge's women face to participate in the work force on its territory?

Answer The challenge's women face to participate in the work force on its territory, as follows;

1- Insufficient employment promotion in rural areas.

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2- 2-Low representation of Saudi Women in management positions compared to international benchmarks.

Question 48 Could Saudi Arabia elaborate on the ways its reform plan intends to increase female participation in the workforce?

Answer Over the last 3 years, the Government's efforts in developing a national policy of equal opportunities have increased women's participation in the workforce from 19.7% to 31.3%. Continuous reforms and initiatives launched to support women entrepreneurship with over 14 free services and programs provided by the General Authority for Small and Medium Enterprises from business counseling and scale-up, research, reimbursement and financing has led to increased number of SMEs entities owned by female.

Question 49 Could Saudi Arabia elaborate on the improvements and progress that it has made towards gender equality since its last TPR?

Answer Enhance opportunities and enforce equal wages through legislating (equal pay for equal jobs), and legislating the following:

• Article (3) of the labor law. This article was updated to explicitly prevent gender discrimination and now states: "the right of work for everyone equally regardless of gender, disability, age or any other discrimination criteria either on hiring or announcement of jobs." • Article (38) of the social insurance law. Previously, the Social Insurance Law allowed women to receive a pension once they reach the age of fifty-five and providing a minimum contribution period of ten years. It has been modified to equalize the retirement age between men and women at sixty years. • Article (149) of the labor law. This article prevented women from working at night, and was removed by HRSD. • Article (150) of the labor law. This article prevented women from working in certain sectors such as mining, and was removed by HRSD. • Article (155) of the labor law.

This article was modified to increase the protection given to women during maternity and now states "an employer is not permitted to dismiss a worker or give warning to her while she is pregnant or during maternity leave, and this includes the period of her illness arising from either of them, provided that the illness is proven by an approved medical report and the period of her absence does not exceed (180d days) per year, whether continuous or sporadic".

Question 50 Has Saudi Arabia endorsed or joined international or multilateral initiatives that protect and advance women's economic empowerment? If so, which ones?

Answer Human rights and gender balance are fundamental concepts in the most prominent international treaties where Saudi Arabia has signed and endorsed, such as: 1. Universal Declaration of Human Rights. 2. International Covenant on Civil and Political Rights. 3. International Covenant on Economic, Social and Cultural Rights. 4. The Convention on the Elimination of all Forms of Discrimination Against Women, CEDAW. 5. Declaration of the Elimination of Violence Against Women. 6. Beijing Declaration and Platform for Action. 7. Sustainable Development Goals. 8. The Convention on the Rights of Persons with Disabilities and its Optional Protocol.

Question 51 Page 15 (Para. 4.16) "The implementation of food security strategy is carried out by Saudi Grains Organisation (SAGO) in partnership with the Ministry of Environment, Water and Agriculture (MEWA). SAGO through its chairmanship of the Committee of Food Security Secretariat oversees

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- 27 - three basic initiatives emanating from the food security strategy that will redefine its role within the framework of the Food Security Strategy. One of these initiatives relates to an effective program for strategic reserve, strategic food storage and early warning system, the other is about reducing food loss and waste." Could Saudi Arabia elaborate on the methodology used to determine the volume of its strategic reserve for each of the priority crops?

Answer Still in early implementation stage, but generally according to the Kingdom's food security strategy, appropriate mechanisms and policies will be formulated to operate and manage the strategic food stocks in the Kingdom, in partnership with private sector actors, in a view to maintain adequate stocks of food products to face potential risk related to food security.

CANADA - FOLLOW-UP QUESTIONS

Question 1

Canada's Follow Up Questions to Saudi Arabia's Answer to Canada's Question 14: Canada notes that the requested information is not published within the GAMI regulations and policies (https://www.gami.gov.sa/en/node/259).

Could Saudi Arabia provide the name of the division in GAMI responsible for export controls and a contact person?

Answer Division: Military Industries Policies and Regulations. Contact Person: Turki Alajmi ([email protected]).

Question 2

Is a list of controlled items and associated laws and policies related to export controls available online?

Answer currently the referred data are not available online.

Question 3

Canada's Follow Up Questions to Saudi Arabia's Answer to Canada's Question 15: Could Saudi Arabia please elaborate on the specific upstream and downstream aspects of the maritime industries sector that have been targeted in the zone?

Question 4

Canada's Follow Up Questions to Saudi Arabia's Answer to Canada's Question 16:

Could Saudi Arabia please elaborate on the specific regulatory and administrative incentives offered in the maritime industries sector?

Answers 3 & 4 With regard to Maritime industry, the kingdom seeks to provide legislative incentives by improving procedures and rules, customs and administrative incentives through OSS, which provides services based on the EOB index and a structured interoperability with base economy. For further information, please visit the link below: https://mawani.gov.sa/en-us/pages/default.aspx.

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CHILE

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 Paragraphs 2.40 and 2.43, p. 31 - 32"Establishing trade and economic partnerships with other countries and economic groupings is one of the approaches pursued by the GCC member States to deepen their integration into the world economy. The GCC as a group concluded negotiations for free trade agreements (FTAs) with Singapore and with the member States of the European Free Trade Association (EFTA)". "During the late 2000s, the GCC engaged in negotiations for free trade agreements with several other countries and economic groupings, including Australia, China, the European Union, India, Japan, the Republic of Korea, MERCOSUR, New Zealand, Pakistan, and Turkey. None of these agreements has been formally concluded. Currently, only negotiations for an FTA with China are ongoing. The GCC is reviewing its position regarding all its FTA negotiations". Regarding GCC establishment of trade and economic partnerships - through Free Trade Agreements (FTAs) with other countries and economic zones - Chile would appreciate if the Kingdom of Saudi Arabia could share its views and findings in relation with GCC reviewing process of all its FTA negotiations.

Answer GCC members have finalized reviewing their position regarding FTA negotiations. Currently, the GCC is preparing their priority list of potential FTA partners to initiate and/or resume negotiations with. Saudi Arabia, jointly along with other GCC member states, plan to increase their share in international trade through expanding their network of preferential trade agreements.

Question 2 Paragraph 2.44, p. 32 "Some GCC member States (Bahrain and Oman) concluded bilateral FTAs, notably with the United States. In the case of Saudi Arabia, bilateral economic relations with the United States are conducted under the Trade and Investment Framework Agreement (TIFA), signed in 2003. The TIFA is aimed at improving legal protection for investors, strengthening intellectual property protection, enhancing the efficiency of customs procedures, and increasing transparency in government and commercial regulations. The GAFT is currently assessing the potential to expand the Kingdom's network of FTAs in light of the Vision 2030 goals". Paragraph 2.44 indicates that some GCC members - including the Kingdom of Saudi Arabia - have concluded bilateral FTAs with non - GCC countries. In this context, Chile would appreciate if the Kingdom of Saudi Arabia could share its views regarding the possibility of starting bilateral FTA negotiations with other non - GCC countries.

Answer GCC is preparing a list of potential FTA partners to initiate and/or resume negotiations with. Saudi Arabia, jointly along with other GCC member states, plan to increase their share in international trade through expanding their network of preferential trade agreements.

Question 3 Paragraph 3.63, p. 50 "On 3 January 2019, Ministerial Decree No. 211 established the GAFT. The Trade Remedies Deputyship (TRD), under the GAFT, is responsible for all issues related to trade remedies. The Deputy Governor of the TRD is a member of the Permanent Committee and participates in its decisions. The Minister of Industry and Mineral Resources represents Saudi Arabia in the Ministerial Committee for final decision-making of trade remedy matters". Regarding paragraph 3.63, Chile would be grateful if the Kingdom of Saudi Arabia could share the reasons why the Minister of Industry and Mineral Resources was chosen to represent Saudi Arabia, in the Ministerial Committee for final decision-making of trade remedy matters. In addition, if an investigation related to agriculture products is launched, we appreciate if you could clarify if the Minister of Industry and Mineral Resources can be changed to the Minister that deals with agricultural matters, for example. 3.3 Measures Affecting Production and Trade 3.3.4 Competition policy and price controls

Answer The "GCC Ministerial Committee" is originally the "GCC Industry Cooperation Committee" which established a long time before the issuance of the GCC Common Law on Anti-dumping,

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Countervailing and Safeguard. The GCC Industry Cooperation Committee are formed with the GCC Ministers whom responsible on Industry's issues in each GCC State and is responsible on several issues related to the GCC industry cooperation issues. At the time of issuing the GCC Common Law, the Saudi Minister of Industry was also assigned to trade issue. Currently, trade issues are assigned to the Saudi Minister of Commerce. Accordingly, GAFT and the Minister of Industry are cooperating in handling the issues of the GCC trade remedies through the GCC Permanent Committee and the GCC Ministerial Committee. In case of agriculture products when related to trade remedies, according to the GCC Common Law on Anti-dumping, Countervailing and Safeguard Measures, the final decisions of the measures on agriculture products will also be taken by the GCC Ministerial Committee.

Question 4 Table 3.10 Main changes between the old and new Competition Laws, p. 63 Regarding the issue of "Exceptions", indicated on table 3.1, Chile would appreciate if the Kingdom of Saudi Arabia could provide the list of the fields of commodities and services that are excluded, following the exemption for public institutions and state-owned corporations that are authorized by the Government.

Answer The exemption is only granted conditional fulfilling two requirements; (1) the entity shall be solely owned by the Saudi Government and (2) the entity shall be solely authorized to provide a commodity or service.

Question 5 Paragraphs 3.154 and 3.159, p. 67 -69 "Saudi Arabia notified the WTO that it does not maintain any state-trading enterprises within the meaning of Article XVII of the GATT 1994 and the Understanding on the Interpretation of Article XVII". "The Government is promoting the listing of private Saudi companies and state-owned enterprises. Notably, on 11 December 2019, Saudi Aramco was listed on the Tadawul and became the world's largest publicly traded company". Paragraph 3.154 indicates that the Kingdom of Saudi Arabia has not notified that it maintains state-trading enterprises within the meaning of Article XVII of the GATT 1994 and the Understanding on the Interpretation of Article XVII. Considering the fact that in many parts of the Report (such as paragraph 3.159) the existence of state-owned enterprises is mentioned, Chile would appreciate if the Kingdom of Saudi Arabia could explain how the definition of state-trading enterprises contained in Article XVII of the GATT 1994 and the Understanding on the Interpretation of Article XVII does not apply to the any of the state-owned enterprises maintained in the Kingdom of Saudi Arabia.

Answer In the most recent notification pursuant to Article XVII:4(A) of the GATT 1994 and Paragraph 1 of the Understanding of the Interpretation of Article XVII, the Kingdom of Saudi Arabia stated: "Pursuant to Article XVII: 4(a) of GATT 1994 and paragraph 1 of the Understanding on the Interpretation of Article XVII, the Kingdom of Saudi Arabia notifies that it does not maintain any state trading enterprises in accordance with the working definition contained in paragraph 1 of the above mentioned Understanding." Paragraph 1 of the Understanding provides the following definition of STEs: "Governmental and non-governmental enterprises, including marketing boards, which have been granted exclusive or special rights or privileges, including statutory or constitutional powers, in the exercise of which they influence through their purchases or sales the level or direction of imports or exports." This definition does not apply to enterprises in the Kingdom of Saudi Arabia.

Question 6 Paragraph 4.135, p. 113-114 "Telecom companies operating in this well-developed sector created revenues of SAR 78.8 billion in 2019. Following the start of biometric SIM card registration in 2016, the number of mobile subscriptions and pre-paid cards per 100 inhabitants fell from 166 to around 121 in 2017, representing SIM cards actually in use. At the same time, subscription rates for fixed-line telephony and Internet access increased between 2015 and 2019 (Table 4.21), and almost all (95.7%) of Saudi residents use the Internet. The average download speed of mobile Internet increased significantly to 84.6 Mbps by October 2020, and Saudi Arabia was ranked 32nd in terms of cost for fixed-broadband telephony in 2019 by the International Telecommunication Union (ITU). A universal access and service policy is in place. The Universal Service Fund financed telecom infrastructure and service in rural and remote areas inhabited by 4.8 million people until 2017, when

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- 30 - it was replaced by new initiatives as part of the NTP. High-speed mobile broadband covered 70% of the population in rural areas at the end of 2020". Paragraph 4.135 refers to the Universal Service Fund, which later becomes part of the National Transformation Program (NTP). In this regard, Chile would be grateful if Saudi Arabia could further explain the objectives of the NTP, particularly with respect to funding for foreign telecommunications companies that could participate in the program.

Answer Regarding funding; any company with national presence can participate in the program.

Question 7 Paragraph 4.145, p. 117 "The Ministry of Commerce and Investment (MOC) issued an E-Commerce Law that became effective in October 2019 with implementing regulations adopted and implemented from 31 January 2020. The Law regulates e-commerce between consumers in Saudi Arabia and service providers based anywhere in the world (including transactions between individuals), and contains clauses on consumer data protection, transparency in contracting and electronic advertisements, consumer rights (including returns and cancellations under certain circumstances), and licensing/registration requirements for traders and electronic platforms. According to the authorities, the new framework increased trust in online transactions and facilitated consumers raising cases related to e-commerce to the authorities as a result of a strengthened consumer protection framework". Paragraph 4.145 refers to Saudi Arabia's new E-commerce law. In this regard, Chile would be grateful if Saudi Arabia could explain with greater depth what are its main characteristics and objectives, areas that addresses and if it contains and/or represents visible changes in the development of their e-commerce. In addition, paragraph 4.145 indicates that Saudi Arabia's new E-commerce law contains provisions relating to consumer data protection. In this regard, Chile would be grateful if Saudi Arabia could refer to the standards contained in this regulation.

Answer The new E-commerce law guaranteed to protect consumer's data with the service provider through retention period, the service provider is fully responsible for the protection, also, the provider is not allowed, authorized or permitted to use it except with the consumer's consent. The service provider may have the data for other purposes, such as advertisements or marketing, and this data is summarized in the consumer's name, identity data, address, contact numbers, license numbers, personal records and bank accounts. The service provider must notify the ministry of commerce in the event that consumers 'data are breached within 3 days of being aware of that, with an explanation of the extent of the breach and its effects. And measures taken to solve it. Also, this notice does not exempt the service provider from its responsibility towards the consumer. The consumer also has the right to request the closure of their accounts with the service provider and not to keep or use their personal data.

Question 8 Paragraph 2.16, p. 8 "The Kingdom has accelerated the development of the investment sector, which is one of the most important pillars of its economy. The kingdom aims for economic diversification and a comprehensive development, including all aspects of the investment climate". In the context of Saudi Arabia´s development of its investment sector, Chile would appreciate if the Kingdom of Saudi Arabia could share which of its economic sectors are being prioritized to attract foreign investment.

Answer - Industrial &Manufacturing - Metal & Mining - Information &Communication Technology (ICT) - Energy & Water - Healthcare & Lifesciences) HCLS) - Petrochemicals, Oil & Gas - Transportation & Logistics (T&L) - Tourism and Quality of Life - Emerging sectors ▪ Education Sector ▪ Entrepreneurship & Innovation Sector

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▪ Real Estate Sector ▪ Financial Services Sector

Question 9 Paragraph 2.17, p. 8 "Other developments included establishing international investment attraction offices in a number of target countries; and enabling 100% foreign investment in the retail and wholesale sectors, transportation, engineering services and associated consultations, and private health institutions". In relation to paragraph 2.17, Chile would appreciate if the Kingdom of Saudi Arabia could share which countries are being considered to establish international investment attraction offices. In the case of those offices already established, we appreciate if you could share information regarding the selected countries, and the main characteristics of their current operations.

Answer Misa's Over Seas Presence: - United States, Germany, France, United Kingdom, Russia, China, South Korea, Japan, Singapore, United Kingdom, China, United States, Japan, France and Singapore are already deployed and operational. - Russia, Germany, and South Korea procedures is being deployed.

Question 10 Paragraph 2.22, p. 9 MISA has facilitated the issuance of a foreign investment license by reducing the issuance period to 20 minutes, and the number of required documents to only two documents. In addition, it provides most of its services electronically. Paragraph 2.22 mentions the Ministry of Investment (MISA) as an institution that issues foreign investment licenses. In this regard, Chile would appreciate if the Kingdom of Saudi Arabia could clarify if all investment sectors in the Kingdom require investment licenses in cases of foreign investors. In addition, we appreciate if you could indicate if there are some sectors in which foreign investment is not permitted.

Answer Ministry of Investment welcomes all investments in all sectors except those specified in the negative list of the foreign investment Regulations as mentioned in the annex no. (1) Of services manual.

Question 11 Paragraphs 3.24 and 3.25, p. 11 "Saudi Food & Drug Authority (SFDA) has issued requirements and conditions for importing food products to Saudi Arabia, which aim to; clarify conditions and requirements for competent authorities in exporting country, clarify the responsibility of the competent authorities in the exporting countries towards verifying the compliance of their establishments, and ensure food safety and facilitate the movement of trade. SFDA has issued the approval framework for control authorities and establishments exporting fish and other aquatic products to the Kingdom. This framework aims to verify the procedures of the official regulatory authority that is responsible for food safety in these countries, as a perquisite for its authorization to approve fishing, processing facilities and farms". Paragraphs 3.24 y 3.25 refer to the requirements and conditions that the SFDA demands for products imported to the Saudi Arabian market. In this regard, and bearing in mind that these requirements sometimes have had the effect of trade barriers - generating difficulties to food products originated from Chile when entering the forementioned market - Chile would be grateful if the Kingdom of Saudi Arabia could inform if it is considering modifying these requirements, or whether is considering implementing alternative methods, in order to facilitate trade of these products.

Answer Saudi Arabia is not planning to modify these requirements, considering implementing alternative methods at the mean time as those documents complement each other. However, if Chile is encountering any difficulties in exporting to KSA, the SFDA welcomes any inquiries regarding this matter. In addition, Chile could provide the SFDA with the establishments interested to export to KSA and will reply to Chile accordingly.

Question 12 Paragraphs 4.39 and 4.40, p. 18 "A new Mining Investment Law was approved by the Saudi Cabinet and published in the Official Gazette on 3 July 2020 and will enter into force in 28 December 2020.

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The new law is designed, to increase investments in the sector through a transparent system, simplified procedures and enhanced investors' confidence". "The key changes expected to be achieved by the new law are; the development of the sector's governance, amend some licenses' types, enhance transparency, develop value-added chains, promote sustainability, preserve the environment, impose guarantees for rehabilitation, optimize the use of mineral resources, ensure equality between local and foreign investors and establishment of TAADIN (mining) platform aiming at boosting investment in the mining sector." Regarding the new Mining Investment Law and its expected outcomes, Chile would appreciate if the Kingdom of Saudi Arabia could further elaborate on how is intended to achieve the "development of value-added chains". In addition, Chile would appreciate if Saudi Arabia could share any specific actions and/or programs intended to support this goal.

Answer The new mining investment law aims to streamline the licensing process and reducing turnaround time, thereby increasing the number of mining license that in return will increase the supply of local raw materials which in return will benefit from existing local demand for value added industries. The development of value-added chains will also benefit from the Saudi industrial development fund which allocated 15 billion SAR of its portfolio to finance mining and mining industry projects. Furthermore, there are several proposed initiatives that will support mineral value chain ecosystem, these initiatives include:

- Development of tailored marketing literature for midstream/downstream promotion that includes business cases for critical projects in ready-made pitch packs. - Enhancement of promotional activities across mineral value chains that include attendance at international conferences. - Targeted midstream and downstream steel investment promotion. - Promotion of base metals midstream development (Cu/Zn smelters/refineries). - Expansion and diversification of inorganic compounds and industrial minerals. - Development of KSA mineral sector support services demand forecast along with relevant business cases to promote development.

Question 13 Paragraph 6.13, p. 27 "Saudi Arabia is investing strategically, not only in developing competitive utility scale and micro generation renewable energy projects, but also in developing the full echo system required to support and position the Kingdom as a global leader in the field. Key initiatives implemented to enable and grow the renewable energy sector include the National Renewable Energy Data Centre; and Renewable Management Centre ("RMC") which provides energy services to foster and facilitate the integration of renewable energy sources". Regarding paragraph 6.13, Chile would appreciate if the Kingdom of Saudi Arabia could provide further information about how is expecting to be a global leader in the field of renewable energy sector, ¿Which type of energy are expected to promote, for example: solar, hydrogen, among others? ¿What types of actions or targets are considering in this field?

Answer The Kingdom of Saudi Arabia has all components of success in the fields of renewable energy to be a global leader in renewable electricity generation, starting with inputs such as silica, petrochemicals, and ending with the strong experience of leading Saudi companies in producing various forms of energy. From this perspective, one of its strategic priorities is providing legal and regulatory framework to accelerate an effective deployment of renewable energy through various strategic partnership and initiatives, and robust investment managed by knowledge based on a state-of-the- art in energy sector. Also, Saudi is known by abundant solar and wind resources, yet other plans for other renewable energy sources are taking into consideration through ambitious strategic initiatives that are being implemented.

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CHINA

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 Page 8，Para.10 Import tariffs, which are subject to common GCC rules, did not change significantly until the recent COVID-19 pandemic. Nearly all tariff lines in Saudi Arabia are subject to ad valorem rates, while 1.3% of total lines have non-ad valorem rates. The simple average of Saudi Arabia's 2020 applied MFN tariff rate was 5.5%, up from 5.2% in 2015 due to changes in the tariff structure and increases in customs duty rates for some products (e.g. fertilizers, and meat and dairy products). On 77.4% of tariff lines, the applied MFN tariff rate was 5%; on 10.6% of tariff lines, the rate was duty free, and on 9.7% of the tariff lines the rate was between 5% and 15%. A very small group of agricultural products is subject to significantly higher applied MFN tariff rates, with tobacco products subject to a rate of 100%. In June 2020, customs duties were raised on various categories of consumer, industrial, and agricultural products as part of the Government's response to the COVID-19 pandemic. Does Saudi Arabia have any plan to reduce import tariff rates?

Answer Raising the tariffs to the bound rates is a legitimate Member's right and it is not limited to a time frame.

Question 2 Page 23，Para.2.4 In order to improve the climate for local and foreign investment, in recent years, the Government took measures to modernize the judiciary; Does Saudi Arabia plan to implement any other measures to modernize judical system? If so, please provide more details.

Answer Yes, the Kingdom of Saudi Arabia is concerned with modernization and development in various fields, including the judicial field. The Kingdom has drawn a comprehensive strategy for the judicial facility in line with local and international changes in this regard, including: enacting a law with regard to the implementation of administrative Judgment, which will enhance the investment environment in The kingdom. Saudi Arabia is currently working on drafting four crucial laws; the Penal Code, Civil Transaction Act, Law of Evidence and Family Law. The first draft is under process right now, and the Crown Minister had announced that it will be published during this year, and one of the main objectives of issuing such laws is to promote human rights and this will be in line with the international agreements and treaties and it's been developed in accordance with best practice.

Question 3 Page 24，Para.2.6 All legal instruments are published in the Official Gazette and enter into force on the date of publication, unless otherwise specified. Does Saudi Arabia have any plan to further publicize legal judgment instruments (non-confidential)?

Answer Special attention is given to make laws publically available. All laws and regulations are published on the official website of the Bureau of Experts in the Council of Ministers, as well as the National Center for Archives & Records which is concerned with preserving all official documents. In addition to the above, each government agency shall publish the laws related to its mandate on its website and its smart applications, in order to facilitate obtaining any law. More so, Saudi Arabia have been publicizing legal judgment instrument for more than (15) years now, and the most popular achievements in this regard are; 1. Code of judicial judgments, the first version was published in 2007 by the Ministry of Justice. 2. Set of Judicial judgments, which been collected and published on a continuous basis by the Research Center in the Ministry of Justice, and an electronic version is available at the official website of the Ministry. 3. Publishing commercial judgments 4. on monthly basis at the official website of the Ministry of Justice to promote transparency. The judgments are available and can be accessed and downloaded by the public in (PDF) files.

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5. Launch a special website that allow access to judicial judgments by public in Saudi Arabia. https://sjp.moj.gov.sa

Question 4 Page 25，Para.2.13 However, the costs of the measures taken by the Government to fight the COVID-19 pandemic, together with the recent collapse of global oil prices, and their impact on public finances could affect the pace and scale of the implementation of Vision 2030. On 11 May 2020, the Government announced a set of measures to deal with the economic crisis caused by the pandemic, including an increase of the VAT rate (from 5% to 15%), the suspension of cost-of-living allowances for state employees since 1 June 2020, and reductions in capital and operating expenditures.… Saudi Arabia has increased the VAT rate (from 5% to 15%). Would this measure affect the implementation of construction and infrastructure projects planned in Vision 2030? Would this measure add more tax burden to contractors?

Answer In 2020, a bundle of enhanced measures was introduced to minimize the burdens on businesses arising out of the pandemic. These measures have also proven helpful to mitigate possible burdens on taxpayers resulting from the increase in VAT. However, since VAT is an indirect tax, the ultimate burden is borne by end consumers. Thus, the increase in VAT is not envisioned to hinder the implementation of infrastructure and construction projects that are part of the 2030 Vision realization program. This is especially so with respect to government projects since in most cases government entities do not bear the burden of VAT. In addition, the General Authority of Zakat & Tax ("GAZT") and the Ministry of Finance ("MoF") have taken steps to mitigate possible cashflow limitations on taxpayers and to avoid disruption of their business operations. Such measures include expediting tax refunds to taxpayers and expediting payments to contractors with whom the government has contracted with to implement projects.

Question 5 Page 32，Para.2.46 Since the last Review, an Agreement on Trade in Services has been concluded among the countries of the League of Arab States. Saudi Arabia was the first to ratify the Agreement and the schedule of commitments, and it started its implementation in October 2019. However, negotiations on the implementation details of some PAFTA provisions on rules of origin and non- tariff barriers are still ongoing, as reported in the previous Review. Please specify whether there is any content related to Traditional Chinese Medicine in the Agreement on Trade in Services concluded among the countries of the League of Arab States.

Answer The schedules of commitments in the Agreement on Trade in Services concluded among the countries of the League of Arab States do not contain any provisions related to Chinese Medicine.

Question 6 Page 36，Para.2.63 Foreign investors must also comply with the Government's Saudization policy (Nitaqat), a long-term plan aimed at increasing the proportion of Saudi employees (including women) in the economy. 63 The policy requires companies to employ a certain percentage of Saudi citizens, which ranges from 5% to 75% based on the nature of the business, the work conditions, and the availability of Saudi employees in the field. Foreign investors must include their Saudization levels when submitting their investment plans for approval. There are also limits on the number of visas for foreign workers available to companies. ... Additionally, since the last Review, the Government has implemented new fees for expatriate employers (which are paid per employee per month). It has also increased levies on expatriates with dependents, and imposed higher fees for business visas and entry/exit permits for foreign workers. Would Saudi Arabia explain this Saudization policy and the plan of next stage? In particular, the applicable scope of localization ratio in Saudi Arabia, the plan to impose higher fees for business visas and entry/exit permits for foreign workers. What is the actual effect while implementing the above policies?

Answer Nitaqat is the primary Saudization policy that requires a percentage of employees in a firm to be nationals, which varies by firm size and economic activity. It was designed to stem rising unemployment and was highly successful in increasing the number of nationals employed in the private sector. As unemployment remains high, it is likely additional Saudization will be asked of the private sector and a plan will be published when there is agreement to do so. There are no known

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- 35 - plans for increasing levies, and the current regime has led to a larger share of private sector employment being occupied by nationals.

Question 7 Page 45，Para.3.34 Saudi Arabia grants tariff exemptions to national and foreign investors for imports of raw materials, machinery, equipment, and semi-manufactured substances required for industrial production based on the GCC Common Industrial Law. Please specify the application scope of tariff exemptions and the application procedures.

Answer The industrial platform includes the investor's guide on requirements to apply for and obtain customs exemption for raw materials, machines or spare parts after obtaining the industrial license, and documents related to the regulation governing exemptions.

Question 8 Page 45，Para.3.36 Saudi Arabia introduced the value added tax (VAT) as from 1 January 2018 at a standard rate of 5%. On 1 July 2020, the standard rate was increased to 15% as part of the measures adopted to deal with the economic crisis caused by the COVID-19 pandemic. Is there any other consideration for Saudi Arabia to raise VAT rate? Does Saudi Arabia have any plan to adjust its VAT standard rate in the coming period in accordance with the control of the COVID-19 and economic recovery progress?

Answer Currently there is no announced plan to change the VAT standard rate (15%). During the pandemic, the Kingdom's priority is ensuring the stability of the economy to the extent possible. Thus, the effects of the VAT standard rate on the fiscal and economic conditions of the Kingdom are under continuous monitoring and assessment.

Question 9 Page 57，Para.3.105, Page 58，Para.3.110 3.105 The SASO has issued more than 30,000 standards to date. 3.110 As at End-June 2020, there were 2,223 national standards in force. Saudi Arabia has issued more than 30,000 standards, but there were 2,223 national standards in force by the end of June 2020. please specify the reason.

Answer It explains that there are 2,223 national mandatory standards out of 30,000 standards.

Question 10 Please introduce the types of Saudi government standards. Besides national standards, are there any other forms of standards?

Answer There are two types of Saudi standards: mandatory and voluntary. There is no other type issued in the Kingdom of Saudi Arabia.

Question 11 The consistency ratio between Saudi standards and international standards is 75%. What is the calculation method? 89% of the country's current standards adopt SCC standards. Are these SCC standards consistent with international standards?

Answer The method of calculating the percentage of consistency of national standards with international standards is based on counting the number of international standards that have been adopted nationally according to "ISO / IEC GUIDE 21" and dividing them by the total number of national standards. In addition, most of the GSO standards are consistent with international standards.

Question 12 Page 63，Para.3.138 The GAC is the regulatory body in charge of implementation and enforcement of the Competition Law and the Implementing Regulations. The GAC has primary jurisdiction over

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Answer According to Article 3.3 of the Competition Law, "The authority shall have original jurisdiction over any matter arising from the application of this law, or conflicting or overlapping with the jurisdiction of other governmental entities". Previously certain government agencies transmitted cases related to GAC.

Question 13 What is the division of responsibilities between the General Administration for Competition (GAC) and the Committee for Adjudication of Competition Law Violations?

Answer Upon the nomination of the Chairman, a committee of experts consisting of five members shall be formed for a renewable period of three years by a resolution of the Board, provided that three legal specialists are among them. The Committee shall adjudicate violations of the Law and Regulations and shall have jurisdiction to decide cases arising from the application of the Law and the Regulations.

Question 14 Page 90，Para.4.37 Specific plans to achieve this objective of maximizing the value from the energy sector were defined in the NIDLP, one of the Vision Realization Programs adopted in 2017 to implement Vision 2030. Does Saudi Arabia have a specific plan to achieve the new energy development goals in NIDLP? If yes, please provide more details.

Answer The new energy development goals will be achieved via a number of initiatives that support the aforementioned strategic objectives. These initiatives include the following programs: - Perform the required pre-development efforts in order to prepare sites for the tendering of solar and wind power generation across the Kingdom. - Extend the gas delivery network to deliver gas to additional industrial cities that are not yet connected.

Question 15 Could Saudi Arabia explain the relevant requirements and participation rules for foreign investors, equipment manufacturers and engineering companies to participate in the development of new energy industry?

Answer - The requirement for foreign investors to manufacture equipment are a copy of their CR and their financial statements. - The requirement for foreign engineering companies are: • The company shall have at least 10 years of experience. • Copies of the commercial registrations of the participating entity in the same field in four countries and a copy of the financial statement.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 16 Page 4，Para 1.5 The General Authority for Foreign Trade (GAFT) was established by virtue of Council of Ministers Decision No. 211 dated 25/4/1440H (1 January 2019). Its administrative regulation was approved by virtue of Council of Ministers Decision No. 741 dated 23/11/1441H (14 July 2020).

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Please explain the purpose of separately setting up the General Authority for Foreign Trade (GAFT), undertaking all the foreign trade functions of the previous Ministry of Commerce. How does the GAFT connect the domestic and foreign trade management functions?

Answer In light of vision 2030 goals, the increasing importance of foreign trade share in Saudi economy and the Kingdom's position as a G20 Member, GAFT was established in response to the mandate of Vision 2030 of increasing the share of non-oil exports and to widen Saudi network of preferential trade agreements. Connecting domestic and foreign trade functions is managed through various channels including; Saudi commercial attaches, private sector coordination department, joint bilateral committees and business councils.

Question 17 Page 4，Para 1.8 MoC has been working on developing various laws and regulations. The most prominent of these laws, is the Companies Law, which has entered into force in 2016. The law aims to facilitate procedures and regulatory requirements and increase capital attraction as well as to achieve balance between stakeholders thus, strengthening corporate governance in accordance with international best practices. Please disclose the legal content of the above-mentioned Companies Law, Professional Companies Law and Franchising Law. Do the above-mentioned laws have any restrictive provisions for foreign investors to register and establish companies in Saudi Arabia?

Answer The mentioned laws are in full conformity with KSA schedule of commitments for trade in services.

Question 18 Page 6，Para 1.22 LRI will grant expatriates the right to transfer between employers upon the expiry of the binding work contract without the employer's consent. KSA's new initiative abolishes the sponsorship system "KAFALAH" and will enter into force on the 14th March 2021. Is there any other considerations for abolishing the sponsorship system besides improving the mobility of foreign employees? Will this policy lead to a further increase of government's administrative fees for foreign workers, such as visas fees?

Answer KSA will observe the impact of the announced changes to mobility, and decide on next steps accordingly. In addition, Vision 2030 and NTP have directed to study how to attract and retain the required foreign talent, which may lead to additional changes in how foreigners can work in KSA.

Question 19 Page 11，Para 20 Saudi Standards, Metrology and Quality Organization (SASO) introduced "SABER" platform.

19. Please introduce the main functions of "SABER" platform.

Answer Saber E-Platform developed under the supervision of SASO, and according to the highest standards of efficiency in terms of speed of registration. Saber is an integrated e-service system that allows traders to register their enterprise and consumer products' data, registration is mandatory whether the product was manufactured locally or imported to be eligible for granting the required certificates of conformity for consumer products in the Kingdom of Saudi Arabia. Saber's Electronic Platform Features: - Improved importation experience through obtaining the certificates of conformity and shipment. - Ensure safety of the products available in the market. - Faster Clearance at borders. - One platform integrated with other entities. - Lower total cost. - Ensure that products are free from defects that may affect the health and safety of the Saudi consumer, limiting fraudulent products, reducing the required time to import products in coordination with the Saudi Customs examination, and speeding up the process of issuing the required Conformity Certificates.

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Question 20 Is "SABER" open to other WTO members? If yes, how to access this platform(website)?

Answer SABER's website (https://saber.sa/) is open to all interested parties and its free of charge and user friendly.

Question 21 Page 23，Para 4.72 The Ministry of Health (MoH) has implemented, in the current strategic plan, modern methodologies in providing patient-centered health care system starting from primary health care to specialized therapeutic services in a professional manner, while preserving patients' rights, such as; the right to be briefed about their condition, the different treatment options, the right to choose their physician, and to be treated with care and respect. Whether Traditional Chinese Medicine has been included into the specialized therapeutic services?

Answer National Center for Complementary and Alternative Medicine (NCCAM) was established in 2019 as part of the Ministry of Health to serve as a national regulatory entity to matters related to complementary and alternative medicine practices. All requests for new practices regulated and monitored by a committee in the NCCAM based on the specification for each field of medicine, hospitalization and treatment. NCCAM provides lenience for each practice within ancient medicine, parallel medicine, natural medicine, or traditional medicine. Some of the approved complementary and alternative medicine practices are acupuncture, osteopathy, chiropractic, naturopathy and cupping.

Question 22 Page 23，Para 4.73 MoH strategy includes other important aspects, such as health insurance, the cooperative health insurance programs, and considering extending coverage to new segments of the community. The strategy will conduct studies on privatization of MoH hospitals in the future, as well as the best management and operation practices, in accordance with the principles of economics, cost Whether Traditional Chinese Medicine has been covered by the health insurance?

Answer Complementary and alternative practices are not included yet by health insurance.

Question 23 Page 27，Para 6.14 The electricity sector in the Kingdom is witnessing a major transformation with a number of ongoing initiatives aimed at increasing the efficiency of the sector and providing service in a comprehensive and efficient manner, achieving sustainability, raising the quality of service and sustaining safety within the sector Could Saudi Arabia further elaborate on its National Renewable Energy Program (NREP)?

Answer The National Renewable Energy Program (NREP) is a strategic initiative under Vision 2030 and the Renewable Energy Initiative. The program aims to maximize the potential of renewable. The program sets out an organized and specific road map to diversify local energy sources, economic development and provide sustainable economic stability to the Kingdom in light of the goals set for Vision 2030, which include establishing the renewable energy to this promising sector.

Question 24 Page 28，Para 6.24-6.25 6.24. According to Article 3 of the new Law, all firms in the Kingdom of Saudi Arabia are subject to competition law, regardless of their nationality and owner. Wholly owned State establishment or company are exempted from the Law and the Regulations if it is solely authorized by the Government to provide a commodity in a particular field. Such exemption shall be effective only by virtue of Royal Decree or Council of Ministers' Resolution. 6.25. The Law applies to all goods and services, in accordance with Article 4 of the Law, prices of goods and services are determined according to market rules and principles of free competition. Please introduce the main reasons for the exemption of wholly state-owned enterprise in the Competition Law? Are there any cases in practice?

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III. OTHER QUESTIONS

Question 25 Does Saudi Arabia plan to simplify the certification process of electronic and electrical products, consolidate various certification requirements, shorten the approval cycle, extend the validity of certificates and facilitate the export enterprises? Answer SASO ensures reviewing its procedures and requirements periodically, and updating them in consistency with national requirements or international practices, with the aim of ensuring the quality and safety of certified products, as well as facilitating their export to KSA.

Question 26 There is only a short transition period after the introduction of new access requirement. Does Saudi Arabia plan to propose a reasonable transition period for buffering the newly issued regulations and standards, so as to facilitate manufacturers and importers to adjust themselves during this period?

Answer Usually, when SASO announces mandatory arrangements, it grants a period of (no less than six months) before implementation, and in certain circumstances the grace period may be extended.

Question 27 SASO does not release technical regulations information on its official website. Therefore, it is difficult to obtain the published regulation outside Saudi Arabia in time. Does Saudi Arabia plan to increase the transparency of relevant technical regulations?

Answer WTO gets notified when the regulation is at the drafting stage. Interested parties are granted 60 days to provide SASO with any comments, feedback and/or inquiries regarding the regulation. In addition, the same regulation draft is uploaded on SASO's official website for public consultations. For instance, the draft of the Technical Regulation of Safety in Machinery – Part 2: Mobile Machinery and Heavy Duty Equipment, planned for adoption in the first quarter of 2021, can be found on the following link: http://www.saso.gov.sa/ar/mediacenter/public_multimedia/Pages/135_1442.aspx Furthermore, another copy of the draft is provided to the Public Consultation Platform, which is supported by the National Competitiveness Center. All adopted technical regulations can be found on SASO's official website on the following link: http://www.saso.gov.sa/en/laws-and- regulations/technical_regulations/pages/default.aspx.

Question 28 28. Are tobacco and tobacco products absolutely import prohibited products? Or does the Government allow the import of tobacco products, but restrict the import by imposing high import duties and other additional taxes?

Answer Tobacco products are subject to high customs duties as published on the customs website, as well as 100% excise tax and 15% value-added tax.

Question 29 Please specify the comprehensive taxes and fees for imported and domestic tobacco products respectively.

Answer The Government of Saudi Arabia imposes only excise tax, VAT, and customs duty (CIF value) on the tobacco products which are deemed to be a solely imported products.

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CHINA - ADDITIONAL QUESTIONS

I QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1

Page7，Para.3 Recognition of such structural challenges led to the launch, in 2016, of "Vision 2030", a comprehensive strategy designed to modernize and diversify the Saudi economy.

Does "Vision 2030" involve tax policies? If so, please introduce what kind of tax policies have been formulated in "Vision 2030".

Answer One of the main strategic objective of Vision 2030 is to modernize and diversify the economic resources by raising the ratio of non-oil revenue. Taxation plays a large scale of income derived from non-oil activities, thus the tax policy is an integral component of Fiscal Balance Program launched under Vision 2030.

Question 2

Page 9，Para.13 Several new policy instruments were adopted to achieve Vision 2030's objectives of increasing non-oil exports and promoting economic diversification. First, the Export-Import Bank was created in 2019 and became operational in 2020. Export financing and guarantees continue to be available through the Saudi Export Programme.

Which institutions provided major financial support for non-oil export business before the establishment of the Export-Import Bank?

Answer The institutions provided major financial facilities for non-oil export business before the establishment of the Export-Import Bank are the (ITFC) and Saudi Export Program (SEP) which is renamed recently to the (The Local Content & Export Sector) due to the new organizational structure of the Saudi Fund for Development.

Question 3

Page11，Para.25 As a result of reforms undertaken during the review period to protect investors, open trading to non-resident foreigners, and deepen capital markets, the Tadawul was included in three internationally renowned emerging market indices.

Does The Financial Sector Development Program (FSDP) include tax policies? If so, please introduce what tax policies have been formulated to promote the development of the capital market.

Answer While no taxation policies have been formulated so far, there is ongoing work under the FSDP in this area. Among the FSDP program, the "ensuring the formation of an advanced capital market" pillar includes an initiative under which CMA, GAZT and other concerned government entities are currently working jointly to review and enhance taxation policies related to the issuance and the investment in the debt capital market instruments, REITs, equity funds, etc.

Question 4

Page53，Para.3.81 In addition to the SEP, the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC) provides export credit insurance services to member States; it also provides member States with investment insurance and guarantees against country risks.

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What are the differences in responsibilities, business scope and products among the export credit insurance services provided by the SEP, the Export-Import Bank, and the ICIEC?

Answer The difference between the responsibilities is that the (ICIEC) covers the exports of the member-states to the world, while (SEP) covers only the Saudi exports to the world.

Question 5 Please explain the coordination mechanism among the SEP, the Export-Import Bank, and the ICIEC?

Answer The coordination mechanism was undertaken through single cases and LC's insurance coverage cases to re-insure some of the insurance transaction policies as well as reinforcing export insurance policies to the local banks with the ICIEC. But in the future, this cooperation will be accredited via the Saudi Export-Import Bank to the (ICIEC) directly due to the recent transformative work of transferring the SEP's activities and services of (Finance – Insurance) to the Export-Import Bank.

Question 6 As a multilateral institution, in its Overall Profile, which industries of its members does ICIEC mainly support the export?

Answer Overall, the partnership and cooperation with the (ICIEC) usually covers the following industries:

• Petrochemicals • Trucks and trailers • Phosphates • Foods • Perfumes • Metal Chassis

Rather than that, (SEP) has no information about the industries of its members does ICIEC mainly support the export by itself.

Question 7 Please indicate the proportion of the total business volume supported by the ICIEC in Saudi Arabia in its Overall Profile.

Answer The proportion of the total business volume contribution by the (ICIEC) with (SEP) for their only partnering cooperative transactions in the Saudi market is USD 268,570,723 of the total amount of transactions which is USD 373,014,894. Rather than that, (SEP) has no information about the proportion of the total business volume supported by the ICIEC itself in Saudi Arabia in its Overall Profile.

Question 8 Which is the decision-making body of ICIEC's business, the Islamic Development Bank or the ICIEC itself?

Answer There is an existing mutual agreement between the (SEP) and the (ICIEC), which states out the bilateral cooperation of the decision-making on re-insurance policies to the local banks between the two organizations, and this agreement is going to be handed out to the Export-Import Bank to sustain those operations. Rather than that, (SEP) has no information about the decision-making body inside the ICIEC itself.

Question 9

Page 74，Para.3.194 With regard to patents and trademarks, the concepts of exhaustion of rights and parallel importation are subject to general rules and principles determined by the judiciary.

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Please provide more information on the general rules determined by the judicial agencies concerning the exhaustion of rights and parallel import.

Answer The judiciary in Saudi Arabia deals with such cases according to the difference of each issue and without prejudice to the provisions of the Intellectual Property Laws in Saudi Arabia, and with the provisions in the international agreements and treaties that the Kingdom has acceded to.

Question 10

Page75，Para.3.197 Article 2 of the GCC Trademark Law expressly includes certain non-traditional marks, such as sounds and smells, in its definition of the term trademark. In 2020, the SAIP issued the first certificate for a sound trademark. The GCC Trademark Law provides for the protection of well-known trademarks, regardless of whether the trademark is registered domestically.

Could Saudi Arabia please specify the types of non-traditional marks defined in the GCC Trademark Law, approved cases of non-traditional marks, and the examination criteria for non-traditional marks such as smells?

Answer based on article 2 of GCC Law currently sound marks and smell marks can be register, SAIP relies on similarity between musical notes in examining procedures of sound marks, and this is done in cooperation with the Music Commission. On the other hand, SAIP working on the procedures for registering smell marks.

Question 11

Please specify Saudi Arabia's criteria for well-known trademarks, and measures to protect well- known trademarks. Is equal protection given to foreign well-known trademarks?

Answer SAIP relies on multiple factors for the protection of well-known marks including the public awareness of the mark due to promotion of such mark, or long period of registration, or use, or the number of countries in which the mark is registered, or the number of countries in which the mark is well- known, or due to the value of the mark and its effect on promoting the goods or services in which the mark is used to make such goods or services is distinctive from others.

Question 12

Page75，Para.3.198 GIs may be protected as trademarks. According to the authorities, the period of time from the filing of an application to the date of rejection or approval is similar to that of trademarks. As part of the Project for the Protection of GIs, and in cooperation with related national authorities, the SAIP compiled a list of agricultural and food products, handicrafts, and national industrial products that may be registered as GIs. The SAIP requested all interested parties to submit written opinions or notes in accordance with a July 2020 deadline.

Please specify the factors considered by the Saudi Arabia in compiling a list of products that can be registered as GIs. Are there any special regulations for the application and registration of GI trademarks? If yes, please provide further information.

Answer Geographical Indications in Saudi Arabia can be registered as collective marks. In addition, Saudi Arabia has been working on developing a sui generis law for the Protection of Geographical Indications. The Saudi Authority for Intellectual Property is the government body taking the lead in the draft law and will be responsible for its implementation. The development process involved all the related government entities and public consultation to ensure effective cooperation. The draft law aims at providing protection for the registered geographical indications, and it also aims to prevent illegitimate exploitation of local products for which the regions of the Kingdom are famous for, or its imitation in a way that leads to misleading consumers about the true source of these products.

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Question 13

Page76，Para.3.203 The period of plant patent protection is 20 years from the date of filing the application; for trees and vines, the period of protection is 25 years.

Does Saudi Arabia plan to join the International Union for the Protection of New Varieties of Plants (UPOV) in the near future?

Answer UPOV Convention is one of the treaties that SAIP is analyzing for proposing possible accession of Saudi Arabia to it.

II QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 14

Page10，Para.3.14 One of the fundamental objectives of the Saudi Vision 2030 is to increase the contribution of non-oil exports to the Kingdom's GDP. Recognizing the importance of achieving this objective and supporting it by approving the mandate of the Saudi Export-Import Bank (Saudi EXIM Bank).

What is the nature of the Saudi EXIM Bank? Does it receive state financial subsidies?

Answer Saudi EXIM was established to provide export financing, guarantees and export credit insurance services to enhance confidence in Saudi exports and supporting their market access to new markets and reducing non-payment risk. The paid in capital is 30 billion SAR and will be fully paid by government.

Question 15 How is the interest rate standard of the Saudi EXIM Bank defined? What is the performance of the Bank?

Answer The interest rate will be determined on commercial basis and aligned with other export credit agencies and ExIms where the bank will be supporting these international transactions that would not be executed due to lack of financing. So far the bank has approved total loans of around 6 billion SAR and the bank is working on expanding its offerings to include more products.

Question 16

Page10，Para.3.16 Saudi Arabia has established the Economic Cities and Special Zones Authority (ECZA). Please introduce the requirements of origin and customs policies for the products processed and produced in the ECZA to enter other parts of Saudi Arabia.

Answer Since SEZs are considered outside the customs territory of Saudi Arabia, any product originating within the SEZ will be subject to customs duties when exported to the mainland.

Question 17 How does the Special Zones Authority (ECZA) actually boost Saudi Arabia's diversification strategy?

Answer SEZs are economic diversification tools. They support the development of sectors in which the Kingdom can have a comparative advantage to reduce the reliance on the oil and gas sectors and hence further diversifying the economy.

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Question 18

Page35，Para.4.19 Table 2.4 Types of licences, minimum capital requirement, and percentage of Saudi partnership, 2020

Does "other transport activities" in the last column of the Table include civil aviation transportation? If yes, please indicate whether there is requirement on Saudi Arabia's shareholding ratio.

Question 19

Whether there are similar requirements in civil aviation transportation services such as general aviation, civil airports, air traffic control, aircraft maintenance, aviation ground services, passenger and freight forwarding, aviation fuel, and computer reservation systems of Saudi Arabia?

Answers 18 & 19 All civil aviation activities are regulated by civil aviation law and its regulations and civil aviation tariff law and its regulation. All civil aviation activities are allowed for 100% foreign investment except for national air transport since the percentage of ownership of a foreigner must not exceed 49% of the company's shares.

Question 20 Please introduce the legal basis for industry management and foreign investment access administration in the above-mentioned fields?

Answer The legal basis for aviation is the Civil Aviation Law, Civil Aviation Tariff law and its Regulations, economic regulations and GACA safety regulations (GACARs).

Question 21 Please indicate whether there are any restrictions on access to civil aviation fields other than the above and explain their legal basis.

Answer Kindly refer to answers provided for questions 18 and 19.

Question 22

Page 57，Para.3.16 Article X of the Implementation Procedures provides that GCC member States shall mutually recognize national specifications and standards until the GCC has created unified standards for all national and imported commodities.

If there are differences in the national food safety standards implemented by the GCC member states for a certain food, and the GCC has not created relevant unified standards, how do the member States implement the relevant standards when trading the food?

Answer In this case, national food technical regulation is implemented. In addition, some GSO technical regulations include national deviation.

Question 23

Page82，Para.4.13 As part of the COVID-19 response, the authorities also increased tariffs on certain agricultural products, such as dairy products, juices, and vegetable and olive oils, in June 2020.

Why did Saudi Arabia increase tariffs on agricultural products such as dairy products, fruit juices, vegetables and olive oil in 2020? Did Saudi Arabia notify WTO in time?

Answer The Kingdom of Saudi Arabia has the full right raise any of its duties up to the bound rate.

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Question 24

Page82，Para.4.19 The number and value of ADF loans have declined since 2015, while overall subsidies increased and approved loans in 2019 increased sharply (Table 4.5).

What caused the surge in the number and value of mid-term loans, short-term loans, and total loans in 2019?

Answer The increase in value is due the change of ADF's Credit Policy.

III OTHER QUESTIONS

Question 25 What policies and measures has Saudi Arabia adopted to support its agricultural development since the COVID-19 outbreak in 2020, and what is the effect of these measures? In which areas will Saudi Arabia continue to introduce measures to support agricultural development in 2021?

Answer Work has been made to enhance lending and credit policy through providing loans to SME and the importation program. Besides of building food reserves and ensuring food security, the loans are meant to assists small holders and SMEs in repayment of loans, and to increase self-sufficiency in certain products and to save jobs. work will continue to support small holders and support the importation of the main crops such as alfalfa, maize and wheat, and secondary crops such as rice, red meat, barley, edible oils, and soya beans. Emphasis also is put on strengthening the logistics and value chain through various program to ensure these crops reach the consumers. In addition to this, Saudi Arabia have also working on building-up strategic food reserves and invested in mills, logistics and production facilities. furthermore, SAGO, as the supervisor of the implementation of the food security strategy in the Kingdom, has coordinated the efforts of all parties concerned with the food security system in the Kingdom to maintain the stability of supply chains and supply in the market. Also, SAGO, has worked on strengthening wheat stocks to cover consumption for more than five months, and has also strengthened the stocks of fodder barley.

Question 26 Please introduce Saudi Arabia's civil aviation management system and the division of obligations, as well as the laws and regulations in the field of civil aviation.

Answer All civil aviation activities are regulated by civil aviation law, its regulations, civil aviation tariff law and its regulation. GACA website includes all required information (www.gaca.gov.sa).

Question 27 Please introduce Saudi Arabia's airport management system, the regulations on the ownership and control of civil airports, and the laws and regulations related to airports.

Answer Kindly refer to answer provided to answer 26.

Question 28 How does Saudi Arabia define public air transport and general aviation? Are there any different economic and safety management policies, or relevant laws and regulations on public air transport and general aviation?

Answer Yes, GACA regulations differentiate the commercial air transport from general aviation based on the number of seats and weight of aircraft. Please refer to GACARs regulation in GACA website (www.gaca.gov.sa).

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Question 29 Please introduce Saudi Arabia's policies and modes of freight rate and charge management for public air transport and general aviation.

Answer GACA applies open market policy in terms of freight rate and ticket fare in general aviation and commercial transport. Aeronautical and non-Aeronautical charges are regulated by implementation regulation of civil aviation tariff act.

Question 30 What support policies does the Saudi Arabia government have for civil airports, regional aviation, international routes, general aviation, cargo aviation and remote areas? Please brief on the source of funds and the standards and methods of subsidies.

Answer Saudi Arabia government support the aviation industry with the aim of increasing the scope of the connection network in the Kingdom, developing the infrastructure and operations of airports, improving the quality of services, increasing the capacity in the Kingdom's airports, and supporting the travel and freight markets in the Kingdom in the upcoming years, by taking advantage of the strategic geographical location.

Question 31 Are there any policies that regulate domestic air transport subsidies? Are there any policies that restrict other countries' air transport subsidies?

Answer GACA applies tariff regulation on all international and domestic airline and there is no subsides.

Question 32 Please introduce Saudi Arabia's policy on flight schedule management, and the methods and procedures for obtaining flight schedules.

Answer GACA has appointed third party for slot coordination to utilize and maximize airports capacity. GACA economic regulation and Worldwide Airport Slot Guidelines (WASG) are applied for slot management.

Question 33 Please introduce Saudi Arabia's airspace management system and the operation mode of air traffic control.

Answer Saudi Air Navigation Services company (SANS) is responsible for organizing and managing the movement of all aircraft arriving, departing, and passing through Saudi airspace and airports. Please refer to SANS website www.sans.com.sa for further information.

Question 34 Please explain the scopes, management responsibilities and legal bases of Saudi Arabia's civil aviation authorities and other relevant authorities in anti-monopoly reviews in civil aviation.

Answer GACA regulate the aviation industry by applying civil aviation law and its regulation however the general authority for competition is responsible for competition issues based on its law and regulation and GACA support it by providing any data required.

Question 35 Does Saudi Arabia plan to further improve its energy efficiency standards?

Answer Yes, Saudi Arabia is always keen to improve the Energy Efficiency for all products (standards), therefore, we are updating the energy efficiency standard for small A/C (SASO 2663) and TBT/WTO is already notified about it.

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Question 36 The Air Conditioner Energy Labeling and Minimum Energy Performance Standard (MEPS) Requirements (2663/2018) issued by the Saudi Standards, Metrology and Quality Organization (SASO) regulates the energy efficiency and MEPS of air conditioners exported to Saudi Arabia. As per such provisions, Saudi customs maintained that Chinese products had quality defects. However, Chinese air conditioners had passed the Saudi and international standard (SASO IEC60335-2-40 and SASO2663) tests before export. Does Saudi Arabia plan to solve the problem of inconsistency between Chinese certification testing and Saudi Arabia's sampling test results?

Answer Saudi customs and the market survey authorities in KSA randomly check products imported and these products should comply with Energy Efficiency standards, by checking that the declared values by manufacturers which should be within the allowable tolerance stated in the standard. In case of non-compliance, the case shall be reviewed with the specific manufacturer.

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EGYPT

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1

4.3 Manufacturing Paragraph 4.96 page 104

4.96. The NIDLP's approach to industrial development leverages high domestic and regional demand to catalyse growth in clusters of promising industrial sectors, optimizes the economic value captured from Saudi Arabia's natural resources, and involves the development of new clusters of transformative industries. The new industrial policy is reflected in a comprehensive and detailed National Industrial Strategy (NIS) focusing on nine sectors: (i) equipment and machinery; (ii) renewable energy supplies; (iii) pharmaceutical manufacturing; (iv) medical supplies; (v) the automotive sector; (vi) oil- and gas- adjacent industries; (vii) food processing; (viii) the aviation industry; and (ix) military industries.119 The selection of these sectors appears to be motivated by, inter alia, the fact that because of high domestic demand and dependence on imports they offer substantial opportunities to attract foreign and local investors to develop local manufacturing capacity.120 In each sector covered by the NIS, the NIDLP sets out in detail the existing situation and context, objectives and strategy, specific initiatives, and relevant agencies involved in the implementation of the NIS. The authorities note that the NIS is currently being updated. Implementation of the NIS is one of the main mandates of the recently created Ministry of Industry and Mineral Resources. In this regard, a new entity, the National Industrial Development Center, was established in August 2020.

We would like to congratulate the Kingdom of Saudi Arabia for its successful National Industrial Development and Logistics Program (NIDLP), we would like to know if the upcoming update on the National Industrial Strategy would add new sectors?

Answer The National Industrial Strategy is currently being updated and it’s expected to have additional area(s) to the nine priority sectors.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 2

4.5.1 Manufacturing Paragraph 4.35. Page 17

4.35. "Tanafusiya" Program launched by Saudi Industrial Development Fund (SIDF) provides enablers and development support to help industrial enterprises reach a high degree of competitiveness through "the Energy Efficiency Program" which aims to reduce the cost of operation in industrial facilities by enabling them to access energy-saving technologies. The "Industrial Digital Transformation Program" supports factories for increasing operational efficiency and competitiveness, for reducing high costs and for enhancing the productivity through applying the latest digitization.

We kindly request the Kingdom of Saudi Arabia to provide us with further details on the enablers and development support provided by the Government to help industrial enterprises reach a high degree of competitiveness through "the Energy Efficiency Program" to encourage digitalisation of industries?

Answer One of the main enablers that SIDF provides is its advisory service. The service is provided to clients through a 3rd party consultant represented in granting clients free initial assessment.

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EUROPEAN UNION

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 Paragraph 1.1. page 13 – comparison of data The data presented in the Secretariat Report shows that between 2010 and 2019 the role of non-oil manufacturing sector in the Saudi Arabia's GDP was not significantly strengthened (7.8% in 2010 in comparison to 8.5% in 2019). What is the Saudi Government's strategy to boost the manufacturing capacities in the years to come? Which areas of manufacturing sector will have priority?

Answer The national industrial strategy includes the priority and strategically targeted sectors as follows, and it is still undergoing updating & reviewing and expected to be complete in Q2 OF 2021

1. Aerospace 2. Building Materials 3. Pharma &Biopharma 4. Food, Agrotechand Aquaculture 5. Metals 6. Automotive 7. Machinery &Equipment 8. Renewable Energy Resources 9. Medical Devices 10. Chemicals

Question 2 Paragraph 1.7, page 15 According to our information, this initial list of products was replaced by a much shorter list of products whose new tariffs became effective on 1 July. What was the reason for enacting an increase of tariffs on those goods and how does that correspond to WTO tariff commitments? Could Saudi Arabia confirm the replacement of the initial list? If so, how was the revised list notified?

Answer The Kingdom of Saudi Arabia increased customs duties for 575 goods on 20 June 2020, in accordance with its obligations to the World Trade Organization, as decided by the resolution. The list also contains several products, including dairy products. Juices, vegetable oils and olive oil were not among the above products.

Question 3 Paragraph 1.7, page 15 (also 3.31, page 44, and 4.13, page 82) "As part of the COVID-19 response, the authorities also increased tariffs on certain agricultural products, such as dairy products, juices, and vegetable and olive oils, in June 2020." Could Saudi Arabia explain why it considered necessary a rise in import duties on olive oil as part of the COVID-19 response, and when it plans to put an end to that measure? Given that Saudi Arabia imports 5000 tonnes of olive oil (CN: 1509) and 3000 tonnes of olive-pomace oil (CN: 1510) from the EU, could Saudi Arabia specify to which categories of oils the increased tariffs apply?

Answer The Kingdom of Saudi Arabia increased customs duties for 575 goods as of 20 June 2020. This list contains several products, including dairy products. The olive oil is not among the above products. All products whose customs duties have been raised to the bound rates are published on the official website of General Customs Authority and it is clear that olive oil is not included.

Question 4 In 2020, Saudi Arabia increased import tariffs on food and dairy products (from 5 % to 20 %), chemicals, building materials, and vehicles. More transparency would be necessary, i.e. timely information regarding the future plans of Saudi Arabia when it comes to the increase of tariffs. In this context, is Saudi Arabia considering an increase of any other tariffs for the year 2021?

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Answer In 2020, there were increase in customs duties on several dairy products. The rate of increase was 10% to 15%, not 20%, as mentioned in the question. KSA has consistently held its commitments regarding transparency through publications of its decisions relating to raising duties to the bound rates. Such decisions and their reasons were published prior to application. Currently, there is no plan to increase tariffs.

Question 5 Paragraph 1.25, page 21 "1.25. Balance-of-payments data indicate that Saudi Arabia is a net importer of services, with a deficit averaging USD 61.0 billion per year during 2015-19, peaking at USD 73.6 billion in 2015. However, services exports increased significantly during the same period, from USD 14.5 billion in 2015 to USD 24.2 billion in 2019 (Table 1.3). Saudi Arabia is a major site for religious tourism, with millions visiting the country to perform the Hajj and Umrah pilgrimages to the holy city of Makkah. On the import side, government-related services constitute almost a third of services imports, followed by transport (22.5% in 2019) and travel (19.2% in 2019)." In the context of the economic crisis resulting from the pandemic, the services sector, especially tourism is facing serious difficulties. Taking into account the importance of religious tourism for the country, what are the future perspectives in this regard? Is Saudi Arabia adopting any measure in order to preserve it?

Answer The development of religious tourism constitutes a priority for The Kingdom of Saudi Arabia, for both Hajj and Umrah. In addition, KSA is aware of the importance of the tourism sector on the service exports and the balance of payment. Multiple measures are currently being taken:

• A complete plan has been developed and executed to welcome visitors to visit Makkah and Madinah while adhering to COVID-19 policies and with reduced capacities. • Multiple committees have been established to closely analyze, assess and monitor the progression of COVID-19 in Saudi Arabia and globally to take action in order to go back to the normal status as soon as possible. • The Kingdom is taking advantage of the current situation where minimal visitors are present to enhance the quality of services across the whole journey. On Umrah, KSA has defined strong ambitions for the sector in the next 10 years, along the following pillars: 1. Allow the maximum number of Muslims from around the world to visit Makkah and perform the Umrah rituals. 2. Support the development of the local Umrah ecosystem to bring religious tourism players in line with world's highest standards – this includes a. Simplified visa process for Umrah b. Easier and more diversified booking process for Umrah with different travel intermediaries (travel agents, tour operators, DMCs, …) c. Upgrade in quality and standards of services providers in Makkah and Madinah (from airport experience to transport, hotel and F&B, …) 3. Enhance the experience for all Umrah visitors

Question 6 Paragraph 1.30, page 22 The report notes that the 2020 World Bank's Ease of Doing Business Index ranked Saudi Arabia 62nd out of 190 economies, significantly below Saudi Arabia's 49th rank of the 2015 World Bank's Ease of Doing Business Index. What are the reasons for this drop from 2015 to 2020 in terms of Saudi Arabia's rank for ease of doing business?

Answer Although the Kingdom's ranking witnessed a decline few years ago, it has picked up from 92 (in 2019) to 62 (in 2020) jumping (30) positions and becoming the world's top reformer (in terms of number of reforms). The Kingdom will continue its pace of reforms to enhance the business environment and the overall competitiveness.

Question 7 Paragraph 2.8, page 24 "2.8. Vision 2030 is developed around three main themes, namely: a vibrant society; a thriving economy; and an ambitious nation. For each theme, the plan sets out specific objectives, programmes, and measurable targets to be achieved by 2030.10 Under the theme "a thriving economy", multiple initiatives are envisaged. These include: creating more private-sector

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- 51 - jobs for Saudi nationals, and increasing the participation of women in the workforce; supporting SMEs; increasing investment in non-oil sectors (i.e. renewable energy, industrial equipment, tourism and leisure, retail, digital economy, and financial services); increasing domestic production and procurement through local-content measures; privatizing state-owned assets and government services (such as health, education, and housing); listing the national oil company (Saudi Aramco) on the stock exchange; deregulating the energy market; and reducing energy subsidies." According to a study published by the WTO in August 2020, women are at risk of suffering more from trade disruption generated by the COVID-19 pandemic, due to the larger share of women working in services. How is Saudi Arabia planning to address the general reforms on the status of women in the labour market in particular after the COVID19 pandemic?

Answer KSA has already implemented a raft of reforms to catalyze the employment of women by removing discriminatory laws and regulations, implementing anti-harassment regulations, and support women to work through facilitating transportation and childcare. All of these have led to the highest female participation statistics on record. KSA will continue to pursue appropriate ways to encourage and support women to work.

Question 8 Paragraph 2.9, page 24, 2.9. "While there were no changes to the basic customs legislation (the GCC Common Customs Law and Implementation Rules and Explanatory Note), Saudi Arabia introduced important changes in customs procedures, as a result of which it now has a country-wide single window for customs procedures. The Saudi Customs Authority enhanced an electronic data interchange system, an electronic trade single window that allows electronic submission and processing of import declarations. Also, Saudi Arabia now has a new risk management system and targeting centre to classify shipments based on their risk level. Could Saudi Arabia inform on its National Trade Facilitation Committee and on its role in the reforms introduced? Could Saudi Arabia give information, if available, on the extent to which the implemented changes in customs procedures in 2020 have contributed to reducing the cost of trading with Saudi Arabia, at import/export? Is there any feedback from business that Saudi Arabia could report? Was business associated to the reforms and consulted? Could Saudi Arabia elaborate on what the 2030 plan would aim at doing in this area and, in particular, in light of the GCC customs union that is detailed in para 2.35 page 30?

Answer Saudi Arabia fully applies all TFA Articles, exporters can whiteness the minimized clearance time, number of mandatory documents and cost.

Question 9 Saudi Arabia going to implement any new initiative similar to the In Kingdom Total Value Add (IKTVA) into other institutions beyond Saudi Aramco, such as SABIC?

Answer initiatives similar to (IKTVA) are entirely private initiatives or programs that were developed and implemented by the private sector. LCGPA is not in charge of these initiatives. LCGPA emphasizes that it does not require the private sector to develop such programs and it has no influence on this regard.

Question 10 Paragraph 2.27, page 28 "2.27. Saudi Arabia is a strong supporter of the multilateral trading system and the WTO. As stated by its Minister of Commerce at the Eleventh Ministerial Conference of the WTO (Buenos Aires, December 2017), Saudi Arabia believes the multilateral trading system can deliver fair, balanced, and equitable outcomes and generate further growth and prosperity; hence, it advocates for Members to support and reinforce multilateral trade rules, and safeguard and strengthen the WTO.24 Saudi Arabia's negotiating interests span a wide range of issues, including the achievement of positive outcomes regarding the Net Food Importing Developing Countries' programme, a permanent solution for Public Stockholding for Food Security Purposes, domestic regulation disciplines in trade in services, the phasing-out of illegal, unreported, and unregulated fishing subsidies, and the e-commerce work programme.25 In 2019, Saudi Arabia joined the Joint Ministerial Statements (Initiatives) on e-commerce, investment facilitation for development, domestic regulation in services, and the informal programme on micro, small, and medium-sized

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- 52 - enterprises (MSMEs). The Saudi authorities are of the view that they have undertaken extensive commitments upon their accession to the WTO, and wish all countries to do the same. They also recognize the centrality of the development dimension in the work of the WTO." Regarding the interest and commitment of Saudi Arabia in the Joint Statement Initiatives of the WTO, in particular domestic regulation on services, when is Saudi Arabia going to present its list of indicative draft schedules?

Answer Currently the General Authority of Foreign Trade is working along with relevant Government agencies in charge of services sectors to prepare the Kingdom's list of indicative draft schedules.

Question 11 Paragraph 2.41 page 31 regarding GCC-Singapore FTA chapter on customs procedures and paragraph 2.44 regarding GCC-US agreement Could Saudi Arabia indicate what is the scope of the provisions of these above-mentioned FTAs and whether there are some commitments that go beyond the WTO TFA? If so, could Saudi Arabia explicitly mention these provisions?

Answer The mentioned agreements were concluded prior to the adoption of the Trade Facilitation Agreement. the text of the GCC-Singapore FTA can be found on the WTO Dedicated RTA Database portal. GCC has no FTA with USA and Saudi Arabia does not have a FTA with USA.

Question 12 Paragraph 2.54, page 34 "2.54 Under the current Foreign Investment Law, a foreign investor may invest as a shareholder in a company owned by a Saudi national, or establish a 100% foreign-owned company (with certain exemptions). In both cases, the prospective foreign investor must obtain an investment licence from the MISA. Licensing procedures for foreign investments were simplified and expedited in recent years: requirements for new licences were reduced to two documents; licences are now issued within 3 hours (previously 20 hours); an instant licence renewal procedure was set up; and the validity of the licences was extended from one to five years." Is Saudi Arabia considering a review of the negative list for foreign investment in order to open more activities to fully foreign-owned participation?

Answer Ministry of Investment launched the "Invest Saudi" platform, which includes investment opportunities in various sectors, along with launching the identity (slogan) of "Invest in Saudi Arabia"; a unified national identity for marketing and attracting investments to the Kingdom.

Question 13 Is there going to be any change regarding the capital required for commercial licenses for 100% fully foreign-owned?

Answer Its under evaluation.

Question 14 Is Saudi Arabia going to review the law to obtain the Saudi nationality?

Answer Outside the scope of the TPR.

Question 15 Paragraph 2.55, page 34 "2.55. Depending on the type of business, foreign firms may also be required to obtain registration/approval from other competent authorities, such as the Ministry of Commerce, the Ministry of Health, the Ministry of Tourism, the Communication and Information Technology Commission, and the Capital Market Authority. Foreign investors from GCC member States are treated as Saudi nationals for the purpose of investment, and are not required to obtain a foreign investor license, provided they are not in partnership with a non-GCC investor." There is a lack of official tools for international companies to verify the financial information from companies established in Saudi Arabia.

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What are Saudi Arabia's plans to provide for officials tools to enhance transparency regarding the entities established in the country to assist international companies in finding the appropriate partner with which to do business?

Answer The kingdom has established two official entities to ensure enhancing transparency and providing financial information from established companies, which are:

1. Simah: Saudi Credit Bureau (SIMAH) is the first national credit bureau in Saudi Arabia licensed to provide both consumer and businesses tailored products and services. The Commercial Credit Reports, tailored to the business sector (with the exception of the banking sector), details companies' existing financial and credit commitment, such as total credit limit, total liabilities and current balance in default. 2. Bayan Credit Bureau: Bayan Portal enables you to view your company's credit information and allow third parties to access and view your credit information thereby promoting trust among SMEs, corporations, and banks.

Question 16 Paragraph 2.57, page 34"2.57. Foreigners may invest in practically all sectors of the economy […] Other services sectors that have been opened to foreign investment in recent years are […] aircraft maintenance and repair […]". Does it mean that restrictions have been removed for investment in groundhandling in general, or only elements of it? If restrictions remain, what are they in detail? Does the creation in 2018 of a special economic zone at Riyadh's King Khalid International Airport have any impact on the liberalisation in FDI in groundhandling at this airport?

Answer Foreigners may invest in all ground handling activities at KSA airpo including the economic zone at King Khalid International Airport.

Question 17 Paragraph 2.59, page 35 "2.59 .Licensed foreign investments are entitled to all benefits, incentives, and guarantees accorded to wholly Saudi-owned companies.59 Such benefits include ownership of freehold property necessary for carrying out the licensed activity and for housing staff; the possibility to sponsor foreign employees, subject to certain conditions; benefits granted under the double- taxation treaties to which Saudi Arabia is a signatory; and protection against expropriation and confiscation. A court order is necessary in order to confiscate a foreign investment, and it may not be expropriated, in whole or in part, except for reasons of public interest and against an equitable compensation." Regarding the new Kafalah system, is Saudi Arabia going to publish the framework to which companies and sponsors must adapt?

Answer Yes, initial notes have already been published, and these will continue to be updated as required.

Question 18 Paragraph 3.4, page 39 regarding the improvement of custom procedures and in particular "(iii) cancelling the requirement for authentication of invoices and documents from the Chamber of Commerce and Embassies" Could Saudi Arabia detail this measure? Has the consularisation been suppressed? Are these measures part also of alleviating the burden on traders that was especially burdensome due to COVID pandemic?

Answer Consulates approval and certification of invoices and documents has been revoked. No it was not part of alleviating the burden on traders due to COVID pandemic.

Question 19 Paragraph 3.11, page 40 "3.11. Upon arrival, all imports are subject to customs inspections. Physical inspection may be carried out for goods on a random basis determined by risk profiling. According to the authorities, 100% of imported consignments are subject to X-ray scanning, of which 20% are physically inspected. Upon payment of customs duties, imported goods may be released from the

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SCA. According to the authorities, the clearance of goods through customs takes an average of two hours, regardless of the mode of transport." Could Saudi Arabia further provide information on the new risk management introduced and as to the reasons of the very high rates of inspections (100% for X-ray and 20% for physical inspections)?

Answer Referral of 100% of imports to X-rays machines is the initial formality that shall be conducted upon the arrival of consignments to customs ports to ascertain their safety and the nonexistence of any prohibited or restricted materials. This matter helps speed up the resolution to refer the consignment to direct clearance or, in case of suspicion, to close inspection. The greatest reason for referring 20% of consignments to the manual inspection after excluding the presence of prohibited items is restricted items or consignments requiring clearance from other entities (Such as the Ministry of Media - the Communications and Information Technology Commission - the Ministry of Energy, Industry, and Mineral Resources - the Saudi Food and Drug Authority ..., and etc.). In addition, one of the tasks of the Targeting Centre is to update the risk indicators, legalize the targeting process and target high-risk shipments, which have a positive effect on reducing the duration of the clearance and increasing the seizure rate.

Question 20 What is the share of small parcels that Saudi Arabia does physically inspect? What is the rate of physical inspection for goods imported by AEOs?

Answer The Saudi Authorized Economic Operator program provides many benefits to certified companies, one of which is the reduction of physical inspection. As of February 2021, more than 190 companies have been registered by General Customs Authority as authorized economic operators and classified as low-risk business partners. The physical inspection rate of goods imported by these companies is 5%.

Question 21 Paragraph 3.15, Page 41 regarding advance rulings and paragraph 3.18 on Saudi Arabia commitments regarding the TFA "There are no legal provisions pertaining to advance rulings. According to the authorities, the SCA answers, on a case-by-case basis, requests for information on customs matters such as classification, valuation, and rules of origin." Does Saudi Arabia contemplate introducing legislation on advance rulings in line with Article 3 of the TFA?

Answer The purpose of the unified manual is to define the key formalities and controls adopted by the customs administrations of the GCC Countries in order to make advance ruling requested by importers or exporters in preparation for their import/ export operations. Thus, the unified manual is a guidance document that helps importers, traders and employers in GCC Countries and exporters for GCC Countries to understand the formalities and controls relating to advance ruling to facilitate their implementation and use, on the one hand. It also contributes to the strengthening of the Information Unit included in the advance ruling at all the first entry ports and all customs administrations of the GCC Countries. The submission of advance ruling request via the internet will be made available by the importers or their representatives to the competent authorities of the customs administrations regarding the goods to be imported. The request of advance ruling will be limited to importers who have a commercial record in the Kingdom of Saudi Arabia.

Question 22 Paragraph 3.25, page 42 On May 27, 2020, Saudi Customs published an increase on the custom tariffs for more than 1040 items. Nevertheless, this list was shortened by half (575) a few days later after the implementation of the rule on June the 10th. Is Saudi Arabia planning to extend the increase on customs tariffs over the 465 remaining items?

Answer The number of items that increased their customs duties on 20 June 2020 was 575. Currently, there is no plan to increase tariffs.

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Question 23 Paragraph 3.54, page 49 "3.54 Saudi Arabia does not operate an automatic licensing scheme, while the non-automatic licensing system is maintained for the purpose of meeting requirements of domestic legislation and/or for compliance with international conventions. This might be a problem in the sense of Article XI of the GATT. The list of products subject to licensing requirements is kept by the Ministry of Commerce and may be amended if necessary." Could Saudi Arabia provide the above-mentioned list of products subject to licensing requirements as well as the reasons why each of these products has been included in that list? What are the criteria for deciding to add or remove products from that list?

Answer Please refer to Table A3.1 of the Secretariat Report for the full list of products subject to Import Licenses. Saudi Arabia's working party report on accession included a list of products subject to import licensing. The list remained mostly the same except for minor amendments due to changes in Government agencies and structures. The criteria for adding and/or removing products subject to import licensing are as follows: - Protect public morals; - Protect human, animal or plant life and health; protect environment; - Collect trade statistics or market surveillance; - Protection of patents, trademarks and copyrights, and the prevention of deceptive practices; - Regulate imports of arms, ammunition or fissionable materials and safeguard national security;

Question 24 Paragraph 3.69, page 51 "3.69. The 2001 Economic Agreement between the GCC member States and its Implementation Procedures contain no provisions regarding the use of export duties and charges or other export restrictions in the GCC's external trade.44" Are there any export duties that are currently applied by Saudi Arabia?

Answer Currently there is no applied export duties.

Question 25 Paragraph 3.74, page 51"3.74. In response to the COVID-19 pandemic, Saudi Arabia took some temporary measures to prohibit exports of some products. These measures ensure the supply of goods necessary for preventing a critical shortage of essential products and for preserving human health. The products subject to the temporary export prohibition include personal protective equipment for safeguarding against the spread of disease, medical equipment, and pharmaceutical products.47" Could Saudi Arabia provide more information on when these temporary export prohibitions will be lifted?

Answer The Saudi Food and Drug Authority currently permits export of medicines, supplies and medical equipment based on their availability in sufficient quantities in KSA.

Question 26 Paragraph 3.73, page 51 "3.73 Saudi Arabia maintains export bans on eight categories of products." Could Saudi Arabia specify the reasons for these prohibitions for each of the products listed in table 3.6? Are there any criteria for removing products from this list?

Answer 1. Animal feed: It is prohibited to be exported where a subsidy is paid to importers. 2. Baby milk: It is prohibited to be exported where a subsidy is paid to importers. 3. Zamzam water: It is prohibited to be exported it because it is not a commercial commodity and is intended for watering visitors to the Two Holy Mosques.

It is forbidden to export gas cylinders because they are intended for marketing the products of the National Gas & Industry Company and are not intended for trading.

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Question 27 Paragraph 3.83, page 54 "3.83. A key element under Vision 2030 and the National Industrial Development and Logistics Program (NIDLP) is the creation of special economic zones (SEZs). SEZs form part of a larger effort by Saudi Arabia to attract foreign investment and diversify the economy away from oil and gas. Prospective SEZs in Saudi Arabia provide incentives in competitive locations for "promising" sectors, notably ICT, tourism, and financial services. SEZs also offer support for multinationals in a wide range of activities including warehousing and fulfilment, inventory management, maintenance and repairs, staging, testing, and assembly." When will the final legal framework for free economic zones be launched? What will the special treatment be?

Answer The legal framework consists of new regulations according to the need of each zone. There are general regulations that govern the overall operations of the zone, but sector specific regulations are the main driver to the sustainability of each zone. The new regulations should be ready by Q1- 2022.

Question 28 Paragraph 3.101, page 57, "3.101. Saudi Arabia's relevant legislation, notably the Technical Regulation, can be found on the SASO's website, the national notification authority and enquiry point for TBT matters.74 The SASO, under the Ministry of Commerce, is the main agency responsible for developing national standards, quality control and assurance, conformity assessment, and certification. In 2019, the Saudi Accreditation Center (SAC) was created as the national accreditation body. It is an independent public entity, under the supervision of Ministry of Commerce." Could Saudi Arabia indicate if it is considering increasing SASOs resources to further enhance its performance?

Answer SASO has developed a five-year plan based on a framework to develop and expand Saudi Arabia's Quality infrastructure. Capabilities Development is one of the major elements in our framework, which focus on the development of current human capital and attracting qualified and high- performing talents. Other elements in SASO strategy is promoting the principle of innovation and digitalization to improve our services.

Question 29 Paragraph 3.111, page 58, "3.111. The GSO is mandated to establish and harmonize standards and technical regulations within the GCC member States. GCC-wide standards may be proposed/initiated by a representing body in a member State and are prepared by the technical committees of the GSO. In general, GSO standards are based on international standards. Once a GSO standard is approved, each GCC Member State may transpose it into a national standard through domestic legal procedures. According to the authorities, Saudi Arabia develops standards and technical regulations at the national level only when there is a pressing need." Currently there are GCC standards not shared by all members, and some countries have more than one platform referring to their Technical Regulations or import system. Is the GCC planning to harmonize in a single common platform the availability of the most updated and accurate regulations for each country as well as the import system? Regarding the standards not shared by all GCC members, for example the Nutritional labelling Technical Regulation "SFDA.FD 2233/2018". As per the SFDA, the regulation "GSO 2233:2012" (available at the GSO standard store) is not valid in Saudi Arabia. In this case, the updated version must be retrieved from the platform Mwasfah and not through the GSO standard store. This has been the case since April 2020 and no changes have been done at the GSO standard store. Additionally, this is a clear uncertainty for foreign exporters whose merchandise is channeled through other countries in the GCC.

Answer The Kingdom of Saudi Arabia will discuss this issue at GSO in order to take into consideration the interested parties comments to the extent possible. The SFDA technical regulations and standards can be found on the platform; https://mwasfah.sfda.gov.sa/

Question 30 If the merchandise is redistributed by the importer in other GCC Member States to Saudi Arabia, what Technical Regulation must the foreign exporter follow?

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Answer When the importer redistributed goods, he must abide by the regulation issued by the GSO and the national deviations mentioned therein for each country. For example, all GCC countries are bound by the Gulf technical regulation for low-voltage electrical appliances and equipment, taking into account the national deviations mentioned therein for each country, such as the shape of the plug and the frequency of the electric current. It is not allowed to import a product that violates the national deviations mentioned in the Gulf regulation. As for the variety of platforms related to products, every government authority in the Kingdom works according to its competence without conflict or duplication of another government authority's procedure. As for the cases in which some technical regulations refer to a number of standard, we confirm that the Kingdom notifies these technical regulations before being approved at the national, in order to consider the remarks raised by the interested bodies. As for the difficulty of purchasing standard through the platforms of the concerned bodies, these authorities have established enquiry points to assist resolving any difficulties that may arise.

Question 31 There are more than six platforms depending on whether the product is regulated by SFDA, SASO or MEWA. Such platforms include Saber, Jeem or Mwasfah. Each of them refers to different regulation or import system, making it difficult for foreign companies to understand the process to import in Saudi Arabia and therefore in the whole GCC. SASO Technical regulations, at the same time refers to GSO standards. In some cases, it refers to more than 10 standards per regulation. Taking in account each additional GSO standard might cost around 100 SAR, this will add up a cost of 1000 SAR to the export. Currently, standards are available to the public under certain fee imposed by the standard store we are facing (mainly Mwasfah and GSO standard store). Additionally, foreign companies experience problems to purchase the items online. Is the GCC going to make standards public and free for everyone (both exporter and importer)? Some of the Technical regulations applied by SASO are not available in the English version?

Answer Copyright and intellectual property restrict standardization bodies in the GCC countries from making national standards available free of charge, given that most of them are adopted by international and regional standardization bodies. Furthermore, all adopted technical regulations can be found in English on SASO's official website via the following link: http://www.saso.gov.sa/en/laws-and-regulations/technical_regulations/pages/default.aspx

Question 32 Will the GCC and Saudi Arabia make mandatory the availability of the English version? Would GCC or Saudi Arabia consider publishing a written information leaflet and holding meetings to explain in detail the new import systems to be followed by the exporter?

Answer As mentioned in the previous answer, all adopted technical regulations can be found in English on SASO's official website via the following link: http://www.saso.gov.sa/en/laws-and-regulations/technical_regulations/pages/default.aspx SASO also, holds workshops and meetings continuously for beneficiaries at the international level.

Question 33 Paragraph 3.114 pages 58-59 Could Saudi Arabia specify the mentioned quality labelling system? Saudi Arabia states that the quality labelling mark is voluntary. Does the quality label relate to any trading benefits? If so, could Saudi Arabia specify these benefits?

Answer The quality mark is a voluntary mark, and for some products, the technical regulations require quality labelling. The quality mark is not associated with any commercial interest.

Question 34 Paragraph 3.124, page 60 "3.124. In addition to obtaining a commercial registration (Section 3.1.1), food importers must register with the SFDA and specify the food items that they import. All imports of food and animal products for human consumption are subject to import permits issued by the

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SFDA. For imports of meat and poultry meat, a Halal Certificate and an Islamic slaughter certificate are required for each consignment, in addition to other documentation generally required for customs clearance. " As per the SFDA, the new regulation for Halal certificates requires the Halal international accreditation center to be certified by the SFDA Halal center. Is there any coordination among all the GCC members when it comes to re-exporting goods from one country to another?

Answer Saudi Arabia announced the mandatory requirements of Halal certificate for imports from both GCC member states and other countries.

Question 35 Paragraph 3.125, page 61 "3.125. Imports of meat and poultry meat must be sourced only from the establishments on the list maintained by the SFDA. This list can be consulted by sector or by country. Establishments that wish to supply meat and poultry meat to Saudi Arabia must apply for approval from the SFDA; the approval process involves an evaluation including an on-site audit by the SFDA. If the evaluation outcome is satisfactory, the SFDA grants an approval certificate to the establishment in question. Since 9 March 2014, the SFDA has delegated to the competent authority of the exporting country to approve establishments on the list, provided that the competent authority of the exporting country signs bilateral minutes with the SFDA and assures compliance with the GSO standards." The EU notes that several of the Sanitary and Phytosanitary (SPS) requirements to enter the Saudi market are detailed in the relevant technical regulations and standards, available on the website of the Gulf Standardization Organization (GSO): http://www.gso.org.sa/gso-website/?lang=en. The majority of these SPS related GSO standards are not publically available, as a fee needs to be paid before they can be obtained. As several of these GSO standards are used as an SPS measure on imports into Saudi Arabia, the EU believes that those GSO Standards should be publically available as required under the WTO SPS Agreement. Could Saudi Arabia inform on how and when it will ensure that its SPS measures will be published, in line with the WTO SPS Agreement?

Answer In terms of publication of GSO technical regulations, the GSO has the copyright of GSO standards and technical regulations. This matter shall be discussed with all GCC members.

Question 36 Paragraph 3.133, page 62 "3.133. It is permissible to trade in genetically modified (GM) foods of plant origin, only if the requirements laid down in the relevant national standards and regulations are met, which include, but are not limited to, the following: - the presence of an official attestation, along with the product certifying that the product is produced and consumed in the country of origin; - no reported adverse effects on human or animal or environment health; and - a declaration on the label that the product is genetically modified." Could Saudi Arabia provide a list of specific national technical standards and regulations informing about the relevant specifications?

Answer Saudi Arabia's list of specific national technical standards and regulations, includes the following; - General Requirements for Genetically Modified Unprocessed Agricultural Products. - General Requirements for Genetically Modified Processed Food and Feed. - General requirements for risk assessment and traceability for genetically modified products

Question 37 Paragraph 3.159, page 68 and paragraph 4.44, page 92 "3.159. The Government is promoting the listing of private Saudi companies and state-owned enterprises. Notably, on 11 December 2019, Saudi Aramco was listed on the Tadawul and became the world's largest publicly traded company. In line with the objectives of Vision 2030, the capital raised for the PIF through the initial public offering (IPO) of Saudi Aramco is to be channelled into new economic ventures, supporting the growth of the private and non-oil sectors (emphasis added) …." "4.44. Saudi Aramco's up-midstream activities consist of exploring, developing, and producing crude oil, condensate, natural gas, and natural gas liquids. Its downstream activities focus on refining and petrochemical manufacturing,

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- 59 - supply and trading, distribution, and power generation. Saudi Aramco's vision is to be the world's preeminent integrated energy and chemicals company (emphasis added)." Could Saudi Arabia explain what non-oil sectors Saudi Aramco in intending to develop? It appears from para 4.44 above that primary among them is the chemicals sector. Could Saudi Arabia elaborate on the plans for the development of this side of Saudi Aramco's business? Could Saudi Arabia explain how Vision 2030 is used to support Saudi Aramco's development of its non-oil sectors particularly the chemicals side.

Answer The general aim is a strategic integration of upstream and downstream businesses to allow the capturing of additional value across the hydrocarbon chain, expand sources of earnings and provide resilience to markets volatility. For example, the proposed acquisition by Saudi Aramco of a 70% equity interest in SABIC supports the significant expansion of the Company's downstream activities, particularly in its chemicals business, and provides additional opportunities for the Company to supply mixed feedstock of crude oil, refinery products and gas to manufacture petrochemicals products.

Question 38 Paragraph 3.165, page 69 "3.165: The new Government Tender and Procurement Law (GTPL) introduces offsets which are prohibited under the WTO Agreement on Government Procurement (GPA). Saudi Arabia is an observer to the GPA not a full Member but the introduction of offsets does not go in the direction of integration of Saudi Arabia on local content preference: How will local content preference be applied? Will local content requirement apply to all bidders including SOEs? What are exactly the sanctions and their amount in case of breach of the local content requirements?

Answer Under the new Government Tender and Procurement Law, all price preference for local content is applied on all bidders whenever the tender contains supply of goods. It is calculated by adding 10% on the price of non-local goods.

Question 39 on SMEs preference: How will be applied the SMEs preference? Price preference for SMEs or set aside of specific contracts? Will the SMEs preference apply to third countries SMEs? Will SMEs from third country be eligible to the SME register?

Answer The new law supports SME's and grants it the following; - Priorities in the direct purchase and in the limited tenders. - Invitations priority is granted to SME's in the limited tenders. - SME's exemption from primary guarantees.

Question 40 With a view of the recent establishment of the Local Content and Government Procurement Authority of Saudi Arabia, could Saudi Arabia provide further information of the competences and functions of this Authority?

Answer Local content requirements, monitoring Local content opportunities development and Center of Excellence.

Question 41 Paragraph 3.171, page 70 The bulk of procurement contract in most countries takes place at sub- central level (cities, regions, etc…). For transparency it is crucial to have a unified legal framework for all level of governments. Could Saudi Arabia provide further details on the new elements that this law brought into the government procurement system of Saudi Arabia? Does the scope of the new GTPL include sub- central level contracting authorities such as municipalities? If not what is the legal framework regulating the sub-central level? Could Saudi Arabia provide further information on the procurement rules applicable to the companies controlled by the State?

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Answer The scope of GTPL include sub-central level contracting authorities. The GTPL does not apply on companies controlled by the State. Those companise have their own procurement system.

Question 42 Paragraph 3.172, page 70 "3.172. The Ministry of Finance is creating and implementing a unified web-based portal, called the ETIMAD, for government procurement efforts. The procedures for all tenders and procurement by governmental entities are to be posted on the ETIMAD, along with electronic versions of the tender documents, except for reasons relating to national security or technical reasons that prevent such posting. The Ministry of Finance will also compile and publish on the ETIMAD a list of "blocked" or "blacklisted" persons. The ETIMAD is expected to enable greater integration through the sharing of data on procurement activities among governmental bodies including the LCGPA, the General Authority for Zakat and Tax, and the Ministry of Human Resource and Social Development." As per Etimad, the Etimad Tender Portal cannot be accessed outside Saudi Arabia and is not accessible to companies with no CR. A local representative must be appointed to act on their behalf either to buy or participate in the tender. Some companies abroad might just be interested in purchasing the tender file to understand whether they are eligible or not for such project without further intentions to participate. Is Saudi Arabia going to change the requirements so an international company can at least access the tender information and files in exchange for a certain fee that could be paid by other methods than SADAD? (SADAD is not an international payment system). The existence of a single portal publishing all contract notices and contract award notices is a crucial element for the participation of foreign businesses to public procurement procedures.

Answer MoF is currently working on ETIMAD to be accessible from outside KSA and also other methods of payment, such as VISA and wallet, will be added.

Question 43 What are the document published in the unified web-based portal? Contract notices and contract award notices from contracting authorities for all level of governments?

Answer Documents, such as contracts and unified forms are available on the following website; https://etimad.sa/LandingPage/CompetationContent

Question 44 Saudi Arabia is an observer to the WTO Agreement on Government Procurement (GPA) and previously committed to start its accession negotiations to this Agreement. In this respect, what are the plans of Saudi Arabia to start that process.

Question 45 Paragraph 3.190 page 73 Saudi Arabia is a party to a certain number of international treaties and conventions included the Convention Establishing the World Intellectual Property Organization (WIPO) and the Berne Convention for the Protection of Literary and Artistic Works. Furthermore, Saudi Arabia committed itself to the full implementation of the WTO TRIPS Agreement. Saudi Arabia has not yet ratified the WIPO Copyright Treaty, the WIPO Performances and Phonograms Treaty, the Madrid Agreement Concerning the International Registration of Marks, the Madrid Protocol, the Geneva Act of the Hague Agreement Concerning the International Registration of Industrial Designs and the 1991 Act of the International Convention for the Protection of New Varieties of Plants (UPOV 1991). Does Saudi Arabia plan to join these international agreements?

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Answer With the exception of the Madrid Agreement2, Saudi Arabia is studying possible accession to the mentioned IP treaties (i.e. the WCT, the WPPT, the Madrid Protocol, the Geneva Act of the Hague Agreement, and the 1991 UPOV Convention).

Question 46 Does Saudi Arabia plan to join the WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT) or the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations?

Answer Saudi Arabia is studying possible accession to the mentioned IP treaties (i.e. the WCT, the WPPT, and the Rome Convention).

Question 47 3.3.7.2 Copyright and related rights, Paragraph 3.191-193, page 74 In 2016, it was noted that Saudi Arabia did not collect royalties for distribution to all right-holders. Is this still the situation? More generally, what kind of amendments were made and in which domains affecting copyright?

Answer Saudi Arabia still does not collect royalties for distribution to right-holders. However, Saudi Arabia now studying and considering the need to regulate how the royalties should be collected

Question 48 Paragraph 3.192, page 74 The Regulations of Optional Copyrights Registration issued by the SAIP's Board of Directors Decision No. 03/07/2019 dated 07/06/1440H (12 February 2019) provide registration services for architectural designs and computer software and applications. As we understand this is a new registration service, we would be interested to hear more about it.

How many registrations have been collected so far? What are the implications if a rightholder decides not to register their work?

Answer The number of registered works is 82. The right holder is protected even without having his/her work registered.

Question 49 Paragraph 3.193, page 74 Could Saudi Arabia provide further information if there is a specific enforcement mechanism such as monitoring for IPS for copyright infringements on the Internet?

Answer SAIP conducts online surveillance for copyright infringements. The procedures for such enforcement is triggered either by a complaint from the right holder or in in an ex officio capacity without notice from the right holder.

Question 50 Paragraphs 3.200-201, page 75 The patent protection period shall be 20 years from the date of filing the application in Saudi Arabia or in GCC. Furthermore, the patent law excludes certain inventions from legal protection. Could Saudi Arabia provide some clarifications about the enforcement of the patent protection? Notably, does Saudi Arabia grant marketing approvals to Saudi companies for the production of generic versions of medicinal products that are still under patent protection in Saudi Arabia or in the Gulf Cooperation Council (GCC) member countries?

2 According to WIPO (https://www.wipo.int/madrid/en/news/2016/news_0023.html), the Madrid Union Assembly decided in 2016 to freeze the single accession to the Madrid Agreement Concerning the International Registration of Marks.

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Answer SFDA fully respect intellectual property rights legislations. SFDA does not register a generic version for innovated product that have patent protection from Saudi Patent Office or GCC Patent Office.

Question 51 Could Saudi Arabia provide details about its Regulatory Data Protection (RDP) legal regime and the conditions under which the Saudi Food and Drug Authority (SFDA) approves generic versions of innovative products?

Question 52 Could Saudi Arabia provide some clarifications as regards the various types of exclusions, in particular are biotechnological inventions excluded?

Answer The Law in article 43 state that "…the invention may be a product, a process or relates to either" and in the article 45 (d) state that "in the application of provisions of this Law, the following shall not be regarded as inventions … (c ) Plants, animals and processes – which are mostly biological – used for the production of plants or animals, with the exception of micro-organisms, non- biological and microbiology processes , (d) Methods of surgical or therapeutic treatment of human or animal body and methods of diagnosis applied to human or animal bodies, with the exception of products used in any of these methods." Therefore, any invention not related to product, process or related to any subject matter in section (c) or (d) mentioned above would be excluded from protection by Law.

Question 53 Paragraph 205-208, page 75 Could Saudi Arabia provide clarifications about enforcement of IPR in order to fight against large- scale copyright piracy in its territory and beyond?

Answer Saudi Arabia has launched many campaigns to raise public awareness as well as to enforce IPR. For example, Saudi Arabia has, recently, destroyed more than 5,500,000 million items that are in violation of IP Laws. For More information, please read the 2020 Annual Report for Intellectual Property enforcement, which can be found on: https://www.saip.gov.sa/en/

Question 54 Paragraph 4.18, page 83 "Administered prices for barley feed were increased in early 2020, while import subsidies for hay remain in place.15 " Concerning import subsidies for hay remaining in place could Saudi Arabia provide information on import subsidy policy for feed imports?

Answer As for hay subsidy, it is currently provided only to integrated feed mills as a productive input for feed production, Meanwhile, the subsidy was stopped for other feed imports such as corn, soybeans.

Question 55 Paragraphs 4.29-30, pages 88-89 "4.29. In 2017, the Council of Ministers approved the Comprehensive Mining and Mining Industries Strategy, which aims to address several challenges confronting the sector. …… At the same time, as discussed in the National Industrial Development and Logistics Program (NIDLP), the Government considers that Saudi Arabia has three main sources of competitive advantage to develop mineral value chains: a large and growing domestic demand; a rich mineral endowment; and competitive energy costs. 4.30. The Government set a number of quantitative objectives to be attained by 2030: (i) to make the mining sector the third major pillar of Saudi industry, alongside oil and petrochemicals, by more than tripling its contribution to GDP." Within Vision 2030 what are the specific programs aimed at developing the mining sector? Para 4.26 states that 'The Government considers that the mining sector offers considerable scope for import

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- 63 - substitution, as Saudi Arabia is a large importer of mineral products'. Given the volumes of imports of iron ore listed in in Table 4.8, could Saudi Arabia elaborate on the plans and time frame to develop mining of Iron ore. In developing the mining sector does Saudi Arabia have plans to develop further downstream industries including smelters.

Answer The national industrial development and logistics program (NIDLP) is one of the Vision 2030's programs that aims to develop the mining sector. This program has launched the Saudi Arabia's Mining and Mining Industries Development Strategy, which has identified many initiatives that fall under five main pillars that help overcome the challenges facing the mining sector: 1. Accelerate exploration operations. 2. Enhancing the economic viability of mining projects. 3. Encouraging investment and structuring the mining sector. 4. Enhancing the social benefits that arise from the value chain. 5. Increasing the sector's contribution to fiscal revenue. In regard to Iron ore, the Saudi demand for DR Pellet is forecasted to increase from 9.5 MTA to reach 13.5MTA by 2035. Further, steel scrap in the Kingdom will remains in short supply. The Kingdom at this point is evaluating several options to ensure that sufficient feedstock is available to supply its industry requirements and is evaluating scrap options and tradeoff between DRI and scrap. Also, the Kingdom is exploring the potential for iron ore mining or LTA, however, still in early stages. In regard to KSA plans to develop further downstream industries, KSA is encouraging investments in several mineral value chains. Each value chain has its own value proposition, therefore the development of the downstream industries might not be in the same order for all minerals and that will largely depend on the feasibility of each project.

Question 56 Paragraph 4.37 page 90, "4.37. In order to grow and diversify the economy, which is one of the strategic objectives of Vision 2030 (Section 2), Saudi Arabia aims to maximize the value captured from the energy sector through: (i) increased localization of the oil and gas sector38; (ii) increased gas production and distribution capacity; (iii) development of oil- and gas-adjacent industries; (iv) increased contribution of renewables to the national energy mix; and (v) enhancement of the competitiveness of the energy market.39 Specific plans to achieve this objective of maximizing the value from the energy sector were defined in the NIDLP, one of the Vision Realization Programs adopted in 2017 to implement Vision 2030. Energy is one of four key sectors addressed by the NIDLP." Taking into account that Saudi Arabia has intention to promote a more diversified economy, not only focus on oil, but also renewable energy. What is Saudi Arabia planning to do to achieve a more diversified economy in particular, what measures are going to be adopted to increase renewable energy projects?

Answer Saudi Arabia is geared to diversify sources of economic sectors such as industries, mining and tourism. Circular Carbon Economy (CCE) approach addresses both renewable and cleaner hydrocarbon technologies to ensure that these sectors meet the required national environmental performance.

Question 57 Paragraph 4.57, page 96 "4.57. Third, changes were made recently to the fiscal regime applicable to Saudi Aramco's operations, to the Price Equalization regime, and to the conditions under which Saudi Aramco sells hydrocarbon products to the Government.

• Pursuant to the revised Concession Agreement, changes were made with respect to the royalty rates paid by Saudi Aramco, effective on 1 January 2020.75 • Prices of domestic sales of crude oil, natural gas (including ethane), natural gas liquids (propane, butane, and natural gasoline), and certain refined products (kerosene, diesel, heavy fuel oil, gasoline, and asphalt) are regulated by the Government (Section 3). A Price Equalization regime established in 2017 provides that Saudi Aramco is entitled to compensation from the Government if it sells crude oil and certain refined products domestically at prices below the corresponding equalization prices. The amount of compensation is equal to the cost of the revenue forgone by Saudi Aramco by complying with the Government's pricing mandates (emphasis added). The Price Equalization regime is administered by the Ministry of Energy. In

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September 2019, the regime was amended to expand its scope to include LPGs and certain other products as at 1 January 2020. • Effective 1 January 2017, the Government guaranteed amounts paid to Saudi Aramco for its sales of hydrocarbon products to various government and semi-governmental entities. This guarantee is subject to a limit to the amount of guarantee for each individual entity."

As mentioned under Section 4.57 above could Saudi Arabia explain how are the prices of crude oil, natural gas (including ethane) and natural gas liquids (propane, butane, and natural gasoline) determined by the Government? What are the Government's pricing mandates and what is the applicable legislation? How is the level of compensation determined? What benchmark is used to determine the level of revenue foregone by Saudi Aramco? How much has Saudi Arabia paid under this scheme in 2020, broken down between the various products?

Answer The Executive Committee for the Governance of Energy and Water Prices Reform oversees the energy and water price reform plan considering economic, social, and sectorial impact .The domestic prices are determined in accordance to the Council of Ministers, No 95 and 166 . There are different indicators and market benchmarks that are utilized to calculate the international prices, e.g. Platts.

Question 58 Paragraph 4.65, page 97 Saudi Arabia has been regulating the price of natural gas. With regard to the pricing of NGLs, Saudi Arabia stated in its Protocol of Accession, that producers/distributors of NGL would "fully recover their production and investment costs […] and make a profit in the ordinary course of business." According to Saudi Arabia, the latter pricing policy was in reflected in a detailed formula for ensuring that domestic NGL prices were based on international market prices, adjusted for a range of cost-based and other commercial considerations. At the same time, the Ministry of Energy determines the tariffs for transportation, processing, fractionation, and other terms and conditions of access to the Master Gas System. It also determines the necessary allocation of natural gas and NGLs to different sectors of the economy based on individual demand estimates for each sector. Additionally, Saudi Aramco owns and operates the Master Gas System (MGS), and performs all domestic marketing and sales of natural gas and natural gas liquids from the MSG. How many NGLs producers and exporters are there in Saudi Arabia, and what would be the 10 biggest? Do they all make a profit: 1/ from their activity, 2/ from domestic sales?

Answer Saudi Aramco is the only producer and exporter of NGLs on commercial bases.

Question 59 Is the policy prerogative of the Ministry of Energy regarding tariffs setting and allocation compatible with transactions in the gas market occurring in line with commercial considerations?

Answer Please refer to the answers of questions 57 and 58.

Question 60 When does Saudi Arabia plan to start exporting natural gas, and what will be the role of Saudi Aramco in that respect, taking into account its current involvement?

Answer Saudi Arabia is focusing on meeting the local demand for natural gas for the expansions and growth in the different sectors including power.

Question 61 With regard to natural gas, the Secretariat's Report states that "starting in 2020, there was to be a targeted and gradual transition to the linked Reference Price with an applied price ceiling". Could Saudi Arabia give the details of this planned pricing policy? Would this new policy be applied for natural gas or also other gas products? What are the target dates for fully implementing this policy change?

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Answer The planned pricing policy was developed to ensure economic sustainability, social welfare, and minimal sectorial impact. The planned pricing policy addresses multiple products; including gas.

Question 62 What is the legal basis for granting a grace period on the payments of royalties on condensate products for Saudi Aramco? What is the approximate average level per annum of the royalties foregone? Would gas producers be granted any other exemptions from payments to the State, now or in the future?

Answer In order to meet the needs of the Kingdom, the Government may choose not to collect royalties from producers for a period specified by the Government. The amount of royalties not collected, if any, is confidential information.

Question 63 Table 4.17 gives information on Electricity tariffs. Are the rates given the actual rates or average rates? Are there different tariffs applicable to different industrial sectors? If so what are the sectors and the various rates applicable? Do energy intensive industries attract different rates? Are there rebates granted by governmental authorities, at central or local level?

Answer - Tariffs are fixed throughout the year. - There are no different tariffs applicable to different industrial sectors. - There is no different rate nor rebates.

Question 64 Could Saudi Arabia provide a similar table regarding the prices of NGLs, including those applied commercially by operators, and those set by the State?

Answer Please refer back to table 4.16 pa 101 as Saudi Aramco is the only operator.

Question 65 4.3 Manufacturing Paragraph 4.94 page 104 As the National Industrial Development and Logistics Program (NIDLP) envisions to transform Saudi Arabia into a leading industrial powerhouse and a global logistics hub what are Saudi Arabia's plans in terms of expanding railway connectivity between Saudi Arabia and its northern neighbours, particularly Jordan?

Answer Saudi Arabia intends to expand railway networks to connect with neighboring countries. With regards to northern neighbors, particularly Jordan, Saudi Arabia has railways lines in the north of the kingdom which can be linked with Jordan in case Jordan has plans to connect the lines with Saudi Arabia

Question 66 Paragraph 4.96, page 104 The Secretariat Report states that the National Industrial Strategy (NIS) will be updated. When will the updated version be available and will there be any additional areas included to the nine priority sectors?

Answer The updated version of NIS is expected to be completed during the first half of 2021, and it's expected to cover additional area(s) to the nine priority sectors.

Question 67 Paragraph 4.145, page 117 "4.145. The Ministry of Commerce and Investment (MOC) issued an E- Commerce Law that became effective in October 2019 with implementing regulations adopted and implemented from 31 January 2020.206 The Law regulates e-commerce between consumers in Saudi Arabia and service providers based anywhere in the world (including transactions between

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- 66 - individuals), and contains clauses on consumer data protection, transparency in contracting and electronic advertisements, consumer rights (including returns and cancellations under certain circumstances), and licensing/registration requirements for traders and electronic platforms. According to the authorities, the new framework increased trust in online transactions and facilitated consumers raising cases related to e-commerce to the authorities as a result of a strengthened consumer protection framework." Could Saudi Arabia clarify if and how the licensing/registration requirements for traders and electronic platforms in the e-commerce law apply to foreign service suppliers?

Answer According to the licensing requirements for a supplier of services outside the Kingdom, the investor may have an official capacity in the Kingdom by registering as a foreign investor and obtaining the requested licenses under person's identity as a foreign investor. If the service provider does not have any legal capacity in the Kingdom, the role of the Ministry of Commerce is to communicate with the store through the contact information on the web page to create direct communication and handle any complaint. The new E-commerce law preserved the consumer's rights in all matters dealings with service providers inside or outside the Kingdom through their commitment to the law and imposing penalties for violators that may reach to block the store's website.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 68 Paragraphs 1.18 and 1.19 page 6 lays out the roles and goals of The Saudi Small and Medium Enterprises Authority (Monshaat) in charge of promoting cooperation with strategic partners locally and internationally. Collaboration between Saudi and foreign MSMEs is vital to develop a dynamic MSMEs ecosystem in Saudi Arabia. How does Saudi Arabia intend to help foreign MSMEs working on the Saudi market? Are there plans to modernize payment terms, vendor registration processes, dispute resolution, etc?

Answer Foreign MSMEs can benefit from all services and programs that Monshaat provides including access to finance and business support. The Franchise program also supports local and foreign MSMEs brands and trademarks, through enabling these brands to expand their businesses. Foreign MSMEs can benefit from this program through the franchise platform where they can offer their brands for franchisees.

Question 69 Paragraph 2.2 page 7 In 2019, Saudi Aramco successfully went through the initial public offering (IPO) while nearly 2 % of shares were sold. Are there any plans for offering more of Saudi Aramco's shares to the public in the near future?

Answer Any future listing decision (timing, amounts, listing venue) is a shareholder decision.

Question 70 Paragraph 2.11, page 8 features the National Center for Privatization and PPP (NCP) as the government's center of excellence to support the privatization strategy in Saudi Arabia by preparing and implementing tenders. Could Saudi Arabia outline the guidelines and characteristics of this process? How can foreign companies apply to these PPP tenders?

Answer NCP along with the privatization ecosystem are currently working on developing guidelines including privatization manual, sectors strategies, marketing and communication plans, all these will ensure the participation of both local and foreign investors in Saudi PPP&P projects. Tendering process ensures transparency and nondiscrimination of any technically eligible investor that meets the project criteria and is able to fulfill the official requirements to operate in the kingdom of Saudi Arabia.

In addition, NCP interacts with private sector companies through a series of investor outreach programs targeting both local and international companies. The outreach programs utilize several

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- 67 - channels such as physical meetings, website information, email newsletters, social media announcement, news releases, etc.

Once the procurement process is launched, eligible local and foreign companies are encouraged to apply with the required credential information. Private sector companies are encouraged to maintain a line of communication with NCP as frequently as possible if required during the whole cicle of the process.

Question 71 Paragraph 2.17, page 8 "2.17. Other developments included establishing international investment attraction offices in a number of target countries; and enabling 100% foreign investment in the retail and wholesale sectors, transportation, engineering services and associated consultations, and private health institutions." Does the plan include liberalisation of ownership in airlines and, if so, will there be any restrictions?

Answer The mentioned para didn't include airlines services, in addition KSA's schedule of commitments didn't include any commitments regarding airlines.

Question 72 Paragraph 3.4, page 9 Saudi Arabia has simplified customs formalities, including minimization of import documents number from 12 to 2 (Bill of Lading and invoice). Are there any plans to further streamline the import and certification processes?

Answer General Customs Authority has worked to facilitate both imports and exports requiremnents to the extent possible. The last thing that was done was to accept a copy of the documents such as bills, invoices, etc., to be submitted by the "importer" via the platform. This formality is called pre- submission, which has helped speed up work on completing the required customs formalities before the consignment arrival to be cleared in perminemum time.

Question 73 Paragraph 3.19 page 11 explains the Economic Cities and Special Zones Authority (ECZA)'s strategy to develop 7 SEZs in the coming 5 years with customized privileges listed. Could Saudi Arabia provide more precise information as to which privileges will be attributed to which zone? Also, does Saudi Arabia has laid out a precise schedule for the creation of these 7 SEZs?

Answer ECZA offers various types of incentives such as regulatory and administrative, in addition to the incentives currently being offered in the Base Economy.

Question 74 Paragraphs 3.20-23, page 11 3.2 Technical Barriers to Trade (TBT) To what extent has the introduction of the electronic certification system Saleem and Saber in 2019, brought supplementary administrative requirements and charges for exporters to Saudi Arabia compared with the previously existing technical requirements and their certification system?

Answer The main purpose of Saber is to Improve the import experience and obtain the certificates of conformity and shipment by using one platform integrated with other entities. Saber has reduced the certification process to 1-7 working days compared to 7-15 working days previously. In addition, Saber is linked directly to Saudi Custom, which grants products clearance within 24 hours. According to the World Bank report, Saudi Arabia has jumped from rank 158 to rank 87 in trading across boarder in which Saber has contributed directly by reducing cost, time, and documents for shipment clearance.

Question 75 What is the language regime used for information about the conformity assessment requirements that is made available to producers based outside Saudi Arabia, and are documents available in English and/or other languages?

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Answer The document, written in Arabic, is the reference. In addition, all adopted technical regulations can be found in English on SASO's official website via the following link: http://www.saso.gov.sa/en/laws-and-regulations/technical_regulations/pages/default.aspx

Question 76 If an exporter exports a product (e.g. of same characteristics, directly substitutable) under several brands to Saudi Arabia, does this exporter need separate SQM certificates for each brand? Does this apply also in a case when an exporter exports this product with several trademarks to Saudi Arabia?

Answer The quality mark is granted to one or more trademarks if the applicant enterprise owns these trademarks as described in the general technical regulations of the quality mark.

Question 77 As a member of ISO, does Saudi Arabia recognise assessments from internationally accredited bodies of compliance with ISO standards (e.g. 9001, 14001)?

Answer It is not a requirement for the quality mark to obtain ISO 9001 and ISO 14001 certificates.

Question 78 Does Saudi Arabia apply the same requirements in terms of conformity assessment to producers established abroad and exporters to Saudi Arabia (including in terms of audits)?

Answer Yes, the requirements are applied without differentiation between manufacturers, whether they are nationals or foreigners.

Question 79 What is the standard procedure to inform producers who are applying for a Saudi Quality Mark (SQM) in a situation when elements are missing in their applications or when SASO grants a SQM certificate? If all the requirements for obtaining an SQM certificate have not been fulfilled, is there a correction mechanism in order for the applying companies just to correct what is needed, and not to re-apply and undergo the entire procedure?

Answer Communication with enterprises is continuous by e-mail, direct contact or by the certification system (JEEM) and SASO gives 30 days to correct observations from the date of application when examining the technical documents submitted with the application.

Question 80 What are the measures/procedures introduced by SASO, which ensure that the information of operators about the applicable technical requirements and the state of their application procedure for a Saudi Quality Mark is easily available and transparent?

Answer SASO provides all its services in order to achieve Neutrality and transparency, the technical regulations, requirements and procedures through SASO's website are available as well as the status of the application through the electronic certification system and direct communication with the beneficiary through it, which is available 24 /7.

Question 81 Does SASO envisage an increase of available accredited certification bodies?

Answer Yes

Question 82 Is it obligatory for importing companies to have a legal representative established in Saudi Arabia and if yes, which would be the legal requirements and obligations of such representative?

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Answer With regard to the quality mark, it is not a requirement to obtain the quality mark to have a legal representative of enterprises outside Saudi Arabia

Question 83 Regarding the GCC Conformity Tracking Symbol (GCTS) which can be obtained from notified bodies authorised by SASO are there any additional certificates of conformity requested, when the GCTS has already been issued?

Answer There are additional requirements for some of products obtaining Gulf Conformity Mark such as power strips and plugs that are enforced to obtain Quality Mark. In addition, fridges, washing machines and water heaters are also enforced to obtain Energy Efficiency Label. These are national requirements additional to Gulf Conformity Mark – which is mandatory to appliances, electrical devices and children toys. Products applying to Quality Mark are granted Gulf Conformity Mark in one single procedure when fulfilling the requirement.

Question 84 Are there fees required for GCTS renewals and are there plans to remove these costs since this is a formal process, executed online by the manufacturer?

Answer This inquiry is within the competence of GCC Standardization Organization, and they have the opportunity to answer the question regarding future planning to cancel the renewal fees.

Question 85 Regarding the update of Regulation SASO 2857:2015 "Vehicles tires rolling resistance and wet rip requirements" are the relevant authorities of Saudi Arabia envisaging to maintain the legal basis (1N/kN allowance) allowing for imports of 3 Peak Mountain Snowflake (snow tyres) to Saudi Arabia?

Answer KSA proposes discussing this inquiry and the technical issues associated with it through the channels of the Technical Barriers to Trade (TBT) Agreement.

Question 86 Paragraph 3.26 page 11 In view of the GCC "Treaty on Excise Tax" of December 2016 and its planned reform could Saudi Arabia inform whether the relevant authorities in Saudi Arabia envisage the decrease of the tax for energy drinks in order to ensure parity between energy drinks and other sugary drinks. Does Saudi Arabia envisage the engagement of private industry stakeholders in the process of revising this tax?

Answer Any details of amendments to the excise tax rate will be announced once there is an agreement among the GCC states and a formal resolution is passed. The Kingdom will publish the draft amended legislation for public consultation prior to enacting the new legislation and will give all stakeholders sufficient time to provide their feedback.

Question 87 Paragraph 3.37, page 13 outlines the developments that occurred in Saudi Arabia with regard to the protection of intellectual property rights. Several structures are mentioned: the "Saudi Authority for Intellectual Property" (SAIP), the "National Committee for Enforcing Intellectual Property Rights" or the "IP Respect Council". In case of infringement of IP rights of a foreign company by a Saudi company, which body is effectively responsible to resolve the dispute and enforce IP rights in Saudi Arabia? Does the ownership structure (public or private) of the alleged Saudi violator impact the enforcement procedure?

Answer It depends on the nature of the dispute, if there is a criminal aspect then the right holder can file complaint in the competent government agency, then a case file will be prepared to be submitted to the public prosecutor to be brought to court. For civil disputes, the right holder can directly go to court to claim his/her rights.

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The protection applies equally to domestic as well as foreign right holders. All rights holders domestic and foreigners benefit from all moral and financial rights, as well as the protection stipulated in the Berne Convention for the Protection of Literary and Artistic Works and the provisions of the Copyright Law and its Implementing Regulations (Article 18: Scope of Protection).

Question 88 Paragraph 3.42 page 13 3.42. SAIP is currently reviewing and amending its IP legislations to incentivize innovation, investment and production of creative works, addition to, and requesting public feedback on a number of draft new legislations. Could Saudi Arabia provide details about these amendments?

Answer SAIP is currently reviewing the copyright law, the law of patent, layout designs of integrated circuits, plant varieties and industrial design, and Regulations for the Protection of Confidential Commercial information to propose drafted amendments. With the exception of Patent law, SAIP issued a public consultations request to gather feedback from the public on ne drafted copyright law and Regulations for the Protection of Confidential Commercial information to collect issues, and address them in a new drafts of laws. SAIP, also, is working on proposal of new draft law for geographical indications which had been published for public feedback.

Question 89 Paragraph 4.24, page 16 4.24. Aquaculture is one of the important and vital productive sectors How are environmental and social sustainable criteria embedded in the aquaculture strategy of Saudi Arabia?

Answer 1. Aquaculture in the kingdom of Saudi Arabia will have to continue to grow to meet the increasing demand for fish. Ministry of Environment, Water and Agriculture (MEWA) develop the aquaculture strategy to contribute to local, national planning and management to cater for environmental, social, economic, health and animal welfare concerns. MEWA has already implemented a number of activities at Policy framework and regulatory level to regulate the sustainable management and development of natural resources also to maintain the high- quality standards in the environment where fish or shrimp farms are planned or are already operational. This is through the formulation of modern controls and mechanisms governing the issuance of licenses for aquaculture projects and monitors their activities. That include the environmental impact assessment study which process of evaluating the likely environmental impacts of a proposed project or development for each aquaculture projects, taking into account inter-related socio-economic, cultural and human-health impacts, both beneficial and adverse. 2. There are a number of guidelines prepared by the technical Cooperation and partnership between the MEWA in the Kingdom of Saudi Arabia and the Food and Agriculture Organization of the United Nations that support the sustainable aspects in aquaculture projects such as the Guidelines and Criteria on Technical and Environmental Aspects of Cage Aquaculture Site Selection in The Kingdom of Arabia, Guidelines on environmental monitoring for cage aquaculture within the Kingdom of Saudi Arabia Such Guidelines ensure that cage farms use practices that minimize environmental impacts for the long term sustainability of cage aquaculture within the Kingdom of Saudi Arabia. 3. At the same time, to support the monitoring of aquaculture projects The General Authority for Meteorology and Environmental Protection (Now the National Center for Environmental Compliance) is responsible for mechanism for an environmental monitoring schedule and environmental Surveillance Program also review the EIA as a main requirement for aquaculture projects licensing. 4. As a case of all aquaculture, maintaining standards of responsible and sustainable culture practice has become a matter of priority for kingdom, which paved the way for the compilation of National Aquaculture Polices and Practices. MEWA developed the National Aquaculture Policies and Practices as official regulation to be followed in all matters related aquaculture practice in the kingdom. The Fisheries Department is responsible for all activities related to aquaculture operations in the Kingdom of Saudi Arabia. 5. The producers in the Kingdome of Saudi Arabia shall consider carrying out practices that reduce the risk of a disease outbreak since they operating aquaculture facilities. National Biosecurity program in the kingdom is a set of practices for aquaculture projects Implementation process to minimize the introduction, establishment and spread of pathogens.

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MEWA is technically cooperating with (SAS) through Fisheries Department to implement the Biosecurity program in the kingdom which is mainly responsible to (1) Control, regulation and supervision of aquaculture operations in coastal and inland regions also supporting research projects on aquaculture. (2) Control and follow-up measures have been updated based upon international laws and Kingdom concerns to achieve sustainable development and maximum production capacities of the projects. 6. MEWA understand that aquaculture can be expanded in Saudi Arabia, but only if it is done sustainably and responsibly production. BAP certification is the world's most comprehensive third-party aquaculture certification assure Animal Health and Welfare and food safety, Social Responsibility, environmentally sustainable. MEWA support companies to be certified with the BAP third-party certification which is a program as the national standard for all Saudi Arabia aquaculture facilities to ensure the high-quality production. Hence, all existing Saudi Arabia aquaculture projects (processing plants, farms, hatcheries and feed mills) required to attain BAP certification, BAP certification is condition of licensing new aquaculture facilities by MEWA. 7. Moreover, MEWA support SAMAQ, which is the Saudi national aquaculture product certification and labeling program developed by the Saudi Aquaculture Society under the guidance of MEWA (Fisheries Department). SAMAQ is the logo of the official national aquaculture product certification program. The label indicates that a product complies with requirements of the Saudi Arabian Code for Responsible Aquaculture Practices, and is in accordance to international guidelines and standards. The SAMAQ logo indicates the local origin, freshness and safety of the national aquaculture products.

Question 90 Paragraph 4.35, page 17 outlays several industrial programs to promote energy efficiency and digital transformation. These topics are very much actual and find a resonance in numerous states with similar initiatives carried out by dedicated public agencies or private-public clusters. Are there any tools put in place for possible paths of cooperation between the Saudi programs and these foreign organizations? If so, how do these instruments work?

Answer The instruments work via agreeing and signing MOUs between relevant parties.

Question 91 Paragraph 4.73, page 23 evokes studies carried out by the MoH on privatization of hospitals. How does Saudi Arabia see the future of its health system? Is it moving towards an all privatized system or going for mixed service provision with public-private cooperation? How does the insurance coverage fall into these plans (statutory private insurance)?

Answer The Ministry of Health in Saudi Arabia is undergoing a major transformation to separate regulation, payment and provision functions. Accordingly, the health system will compromise of the following three entities: - The Ministry of Health will be the regulator of the health sector, both private and public. - Public health care providers will be corporatized to be transformed to accountable care organizations which will be responsible for population health management. - Center of National Health Insurance will be responsible for financing the public provision system based on a risk-adjusted capitation model.

The system is moving towards an integrated mixed service provision system with public-private cooperation. Statutory private insurance will be responsible for financing healthcare activities of its beneficiaries.

Question 92 Paragraph 5.1, page 24 Saudi Arabia is one of the six members of the Gulf Cooperation Council (GCC) as well as the Gulf Common Market (GCM), which was officially launched in 2008. What specific progress has been achieved in terms of harmonizing GCC member states' regulations regarding packaging and custom formalities?

Answer Work is in progress reagrding the refered topics.

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Question 93 Paragraph 6.21, page 28 "6.21 As part of the Kingdom's transformation plan in Vision 2030, the government implemented two phases of energy and water price reforms in 2016 and 2018. The evaluation, planning and execution of energy and water price reforms is overseen by an executive committee formed from multiple government agencies." SEC Paragraph 4.79 "4.79. Reform of domestic energy prices was an important component of Saudi Arabia's economic transformation policies during the review period. Saudi Arabia provided energy products to its domestic consumers at prices that are usually lower than export prices." As referred to under 6.21 of the Government Report above, could Saudi Arabia explain what the reforms of prices in the energy sector have entailed? As mentioned under 4.79 of the Secretariat Report what is the percentage difference between prices charged to domestic consumers (including industrial operators) versus export prices, in particular for crude oil and oil products, natural gas and NGLs. Could Saudi Arabia provide information on the trends in this percentage from before and after the reform? Could Saudi Arabia provide the reference of the legislative framework for the setting of energy prices?

Answer Depending on the product, there are different frequencies at which prices are updated (daily, weekly or monthly). Such frequencies would depend on the various indicators that have an influence on the movement trends. Domestic prices are reflective of production costs and a reasonable profit as well as other commercial considerations including quality, availability, marketability and transportation.

Question 94 Paragraph 6.23-25, page 28 "6.23 The new competition law, issued by virtue of Royal Decree No. (M/75) dated 29/6/1440H (3\5\2019), replaced the old law. 6.24. According to Article 3 of the new Law, all firms in the Kingdom of Saudi Arabia are subject to competition law, regardless of their nationality and owner. Wholly owned State establishment or company are exempted from the Law and the Regulations if it is solely authorized by the Government to provide a commodity in a particular field (emphasis added). Such exemption shall be effective only by virtue of Royal Decree or Council of Ministers' Resolution. 6.25. The Law applies to all goods and services, in accordance with Article 4 of the Law, prices of goods and services are determined according to market rules and principles of free competition." Could Saudi Arabia explain what commodities are covered under the exemption for wholly-owned state establishments or companies in a particular field as mentioned under 6.24 above. It would appear that this exemption also applies to the determination of prices as shown in Table 3.10 "Main changes between the old and new competition laws" in WT/TPR/S/407 i.e. the WTO Secretariat Report. It appears that this contradicts the statement in 6.25 above. Could Saudi Arabia explain how this list of commodities is determined, by whom and where the legislation/information is explained and how the prices for the specific commodities are set?

EUROPEAN UNION - FOLLOW-UP QUESTIONS

Question 1

EU follow up to question 2: Could Saudi Arabia indicate how and when the tariff increases were notified?

Answer The Kingdom of Saudi Arabia as any WTO member has the right to raise any of its duties up to the bound rate. More so, the Kingdom has notified the updated the applied tariff scheduals to the WTO IDB.

Question 2

EU follow up to question 8: Could Saudi Arabia give more details on the "minimized clearance time" and give figures by means of transport?

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Answer It is possible to clear the consignments before the shipment arrives at the customs ports if the importer is obliged to submit the customs data in advance.

Question 3

EU follow up to question 23: The objective of collecting trade statistics or market surveillance could be achieved through automatic import licensing. Is the particular criterion intended for some specific products on the list, and if so what is the rationale? Are these temporary measures?

Answer The particular criterion is not intended to specific products.

Question 4

EU follow up to question 24: Under which circumstances does Saudi Arabia foresee the application of export duties? Does Saudi Arabia contemplate introducing export duties?

Answer Currently there are no fees imposed on exports.

Question 5

EU follow up to question 26: Saudi Arabia's response mentioned reasons to maintain exports bans for some of the products mentioned in table 3.6 but not for all. Could Saudi Arabia provide a legal basis for export prohibitions for each of the listed products. In addition, could Saudi Arabia specify the reasons for these prohibitions for the rest of products mentioned in table 3.6? Are there any criteria for removing products from this list?

Answer The reason to maintain exports bans for some of the agricultural products is to conserve scarce water resources in the kingdom of Saudi Arabia.

Question 6

EU follow up to question 47: Could Saudi Arabia provide more information on the collection of royalties and if rightholders receive royalties from other sources such as e.g. Collective Management Organisations (CMOs)?

Answer Royalties related to the extraction of hydrocarbons are regulated by the concession agreement.

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ICELAND

III. OTHER QUESTIONS

Question 1

What is the participation of women in the economy of Saudi Arabia?

Answer based on GASTAT labor force survey Q3 2020 women participation rate is 30%.

Question 2

Have specific barriers that limit women's participation in trade been identified?

Answer There exist no barriers applied that limits women's participation in trade.

Question 3

Has Saudi Arabia implemented any specific measures to encourage women's participation in trade and promote women's entrepreneurship, or are such measures being developed?

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INDONESIA

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1

SUMMARY Page 8-9 (Para 11) Saudi Arabia introduced the value added tax (VAT) as from 1 January 2018 at a standard rate of 5%. VAT was introduced as a result of a common approach between GCC member States. On 1 July 2020, the standard rate was increased to 15% as part of the measures adopted to deal with the economic crisis caused by the COVID-19 pandemic. On 31 January 2017, Saudi Arabia ratified the GCC Common Excise Tax Agreement and issued the Excise Tax Law and its Implementing Regulations. Two different excise tax rates apply: 50% on soft/sweetened drinks or 100% on tobacco-related products, energy drinks, and electronic devices for smoking/vaping.

Could the Government of the Kingdom of Saudi Arabia explain in detail the objectives of increasing VAT from 5% to 15%, and the mechanism for the refunds of paid import VAT.

Answer KSA continues to ensure that no discrimination is practiced between any taxpayers despite the race, religion, and nationality, as well as equal tax treatment on all the products which are subjected to VAT. Regarding the VAT refund mechanism, there is a certain requirement that should be considered before determining if the taxpayer is qualified for paid tax refund.

Question 2

The Secretariat notes that the VAT measure is a part of government program in order to deal with economic crisis caused by pandemic. Is this measure designed to be temporary during the pandemic? If so, how long is it expected to last?

Answer During the pandemic, the Kingdom’s priority was ensuring the stability of the economy to the extent possible. The VAT rate is currently not under revision, however, the Government of Saudi Arabia regularly evaluates and reassesses the various tax it implements based on many considerations including fiscal & economic conditions, international best practices, transparency, and international standards.

Question 3

Page 11 (Para 26) The Secretariat mentioned that "Royalty fees for telecommunications services were adjusted in 2018 in a deal that saw telecommunications operators commit to additional investment in infrastructure."

Could the Government provide more detail about policy and practices on the royalty fees for telecommunications industry? It would be appreciated if there is a brief on before and after the adjustment, as well as the result of the policy to the FDI.

Answer To enhance the competitive environment with a view to leverage the level of services delivered by the ICT sector. CITC issued Unified Licensing for the licensed ICT services providers in the Kingdom, aiming to enable them to offer a variety of packages for consumers, including mobile, fixed, voice and internet services, rather than the old licensing scheme were operators are limited to the service they were licensed to offer.

Question 4

2 TRADE AND INVESTMENT REGIMES Page 24 (Para 2.8) Vision 2030 is developed around three main themes, namely: a vibrant society; a thriving economy; and an ambitious nation. For each theme, the plan sets out specific objectives, programmes, and

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Recognizing that Kingdom of Saudi Arabia has undertaken commitments to initiate accession, it would be pleasant if the government explains its measures related to local content in procurement as one of the Vision 2030 initiatives.

Answer Regulation of governing the prioritization of local content, local small- and medium-sized enterprises, and companies listed in the Saudi Capital Market for awarding works and procurements was issued by Council of Ministers Decision No 245 dated 29/3/1441. This regulation introduced a number of local mechanisms to measure local content in government procurement.

Question 5 Indonesia would also like to request the Kingdom of Saudi Arabia to provide with the details on how the local-content measures will be implemented, especially to increase domestic production, as well as the consistency with TRIMs Agreement and GATT WTO.

Answer Local content in the field of government procurement is fully consistent with the Provisions of TRIMs and GATT Agreements.

Question 6

3.1.4 Tariffs 3.1.4.1 MFN applied tariffs Page 44 (Para 3.31) In April 2020, the Government raised import tariffs on certain goods, including dairy products, juices, vegetables and olive oils, chemicals, building materials, and vehicles. The changes took effect in June 2020.

Could the Government of Kingdom of Saudi Arabia provide the rationale on implementing the policy?

Answer The Kingdom of Saudi Arabia has raised the customs duties imposed on "575" goods (published at the General Customs Authority’ website), including some dairy products and some chemical products. Yet, they do not cover juice, vegetables and olive oil as referred to as in the question.

Question 7 And, to what extent the policy will affect the implementation of GCC Common External Tariff (CET)?

Answer The Kingdom of Saudi Arabia solely has goods with a customs tariff of more than 5%.

Question 8

3.3.2 Standards and technical requirements Page 59-60 (Para 3.116 and 3.124) As an Islamic country, the Kingdom of Saudi Arabia has also strict marking and labelling requirements, especially for imports of meat and poultry meat. The importers required to include a Halal certificate and an Islamic slaughter certificate for each shipment. Regarding Halal Accreditation Bodies, could Saudi Arabia provide the detail requirements to acquire Halal accreditation from the Saudi Halal Centre? Please elaborate the time frame of this process?

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Answer In order to accept halal certificate for imports of food, recognized halal certification body shall issue Halal certificate. Recognition Requirements: 1- Accreditation certificate based in GSO 2055-2 2- Acceptance certificate by SASO . 3- Recognized by Halal Center.

Question 9

3.3.3 Sanitary and phytosanitary measures Page 61 (Para 3.125) Imports of meat and poultry meat must be sourced only from the establishments on the list maintained by the SFDA. This list can be consulted by sector or by country. Establishments that wish to supply meat and poultry meat to Saudi Arabia must apply for approval from the SFDA; the approval process involves an evaluation including an on-site audit by the SFDA. If the evaluation outcome is satisfactory, the SFDA grants an approval certificate to the establishment in question. Since 9 March 2014, the SFDA has delegated to the competent authority of the exporting country to approve establishments on the list, provided that the competent authority of the exporting country signs bilateral minutes with the SFDA and assures compliance with the GSO standards.

Question 10 Does the SFDA still conducting on-site audit during this pandemic? Please explain if the SFDA has any alternative evaluation. If not, please explain in detail on how the importer could obtain approval letter?

Answers 9 & 10 Due to Covid-19 circumstances, SFDA established a risk assessment approach where it evaluates each request that is received from each establishments and decide whether a documentation evaluation, online inspection or onsite inspection will be applied.

Question 11 Does the SFDA consider the approval and list of meat, poultry and fish companies issued by the competent authority in the origin country could replace on-site audit? This is especially during the pandemic and the origin country has MoU concerning Control, Quality and Safety of Food and Medicinal Products, on a desk-to-desk basis. If not, please explain the reason in detail.

Question 12 Regarding the SFDA new provision which will entry into force on 1 July 2021, the authority requests list of regulations regarding meat, poultry and fish products (in English) that applies in the origin countries as additional requirement to conduct on-site audit. Please explain in detail the objectives of the requirement.

Answers 11 & 12 The SFDA requires the exporting country to fill the country evaluation questionnaire, which asks for the rules, regulations, and legislation that is implemented in the country regarding the products intended for export. We asked for an English version because the one received form the Indonesian side was in Indonesian language. The onsite visit was postponed due to Covid 19 situation.

Question 13 Does the KSA plan to notify this measure to the WTO? If yes, when will it be notified?

Answer Regarding the notification to WTO, the country evaluation questionnaire and the condition and requirements for importing food to KSA is already notified.

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Question 14

4.4 Services 4.4.1 Financial services Page 106 (Para 4.105) The Saudi Central Bank (SAMA) regulates and supervises financial services, while the Capital Market Authority (CMA) regulates capital markets. During the review period, the regulators implemented a large number of reforms, aimed at increasing the use of electronic payments, supporting the development of the FinTech sector, and deepening capital markets. These reforms resulted in the inclusion of the Saudi Stock Exchange in three emerging market indices (Section 4.4.1.3). In 2019, financial services (comprising the banking sector, the insurance sector, and non-bank financial institutions) and business services jointly accounted for 5.6% of GDP at current prices, and financial services alone employed nearly 64,000 people.

What measures have been taken by the government of KSA in order to create level of playing field between Fintech sectors and conventional financial services sector and to protect customer as well?

Answer The existing regulatory and supervisory framework for the fintech firms and banking sector in the kingdom do provide fair competition and financial stability that include consumer protection in line with international standards. Further details on consumer protection could be found on the following link:https://www.sama.gov.sa/enUS/Laws/ConsumerProtectionRules/Banking_Consumer_Protectio n_Principles.pdf.

Question 15

3.3.2 Standards and technical requirements Page 58 (Para 3.109) Since the Kingdom of Saudi Arabia's last Review, some of WTO Members in the TBT Committee expressed concerns about technical regulations on animal products, motor vehicles, vehicle tyres, toys, energy drinks, the sugar limit on food products, electrical and electronic equipment, and plastic products.

Could the Government provide some updates about these concerns? Are these regulations different from the international standards? If so, please provides the arguments and scientific reasons behind these regulations.

Answer KSA proposes discussing this inquiry and the technical issues associated with it through the channels of the Technical Barriers to Trade (TBT) Agreement. Saudi technical regulations and standards are developed according to best international practices and the Kingdom's commitments towards the World Trade Organization, taking into account national deviations, if any, for health and safety reasons, environmental and climate considerations.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 16

1.2 Labor Reform Initiative Page 6 (Para 1.20) The Ministry of Human Resources and Social Development (HRSD) launched the Labor Reform Initiative (LRI) under the National Transformation Program (NTP) on 4 November 2020. The initiative enables HRSD vision of establishing an attractive job market through enhancing the contractual relationship between employees and employers, empowering and developing labor competencies, and the work environment. The reforms will enter into force on 14 March 2021.

Could Saudi Arabia explain more details regarding this new initiative, especially, will this initiative provide better condition for workers from informal sectors, such as domestic worker? if so, how the law enforcement be conducted in case of the violation against the initiative?

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Answer The labor reform initiative is a major shift that will be evaluated and enhanced. Currently, domestic workers are not included in the initiative, however recent years had witnessed enhancement reforms in domestic worker relationships represented in stricter eligibility requirements from the sponsor, electronic contracts and depositing salaries to the bank accounts of the worker.

Question 17

4.2 Food Security Page 15 (Para 4.15) Food security strategy in the Kingdom seeks to achieve five main objectives, which include; achieving sustainable domestic food production system, diversifying and stabilizing external food supply sources, ensuring access to safe and nutritious food and promote healthy and balanced nutrition habits, building food security resilience capabilities and institutionalizing food security at the national level and ensuring clear and accountable governance.

What measures have been taken by the government of Saudi Arabia to ensure food security, particularly for imported food, during this COVID-19 pandemic, considering that there is tightening on goods and service movements to enter or exit the borders due to health security issues?

Answer Saudi Arabia has embarked into providing sustainable financing mechanisms to address food security through Agriculture Investment Abroad (AIA) program and importation program in order to build a good food reserve. These programs have been initiated very much earlier before the Covid-19 pandemic. In fact, the Kingdom possess trustworthy food supply chains capable of daily production that can satisfy consumers according to international standards .Based on the above, a solid cooperation has already been established between several targeted countries under this program.

III. OTHER QUESTIONS

Question 18 Indonesia would like to seek a clarification regarding new measures (as of 5 February 2021) that the government of Saudi Arabia is no longer cooperate with commercial companies which do not have regional headquarter offices in Saudi Arabia.

Answer As of 2024, commercial companies that reallocated their headquarters from the MENA region to KSA will only be eligible to participate in government procurement tenders. Companies with headquarters which didn’t allocate their headquarters to KSA can still participate in any economic activities apart from procurement.

Question 19 Please explain in detail the impact of the GCC rift on the proposed plan for the possibility of establishing an economic partnership framework, including free trade agreements (FTA) with its members and Comprehensive Economic Partnership Agreement (CEPA). Is there any potential prospects after the signing of the Al-Ula Declaration?

Answer The raised question is not an integral part either in secretariat or government reports. Accordingly, its outside the scope of the TPR.

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JAPAN

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 What is the timeline for GCC Member State governments to abolish the selective tax on energy drinks, which is currently applied based on the way of marketing and the level of stimulant substances contained?

Answer Currently there is no plan to remove energy drinks from the list of beverages that are subject to excise tax.

Question 2 And what is a proposal for the new tax system on energy drinks and sweetened drinks? Japan would like to request Saudi Arabia to provide the description of proposed tax system on energy drinks and sweetened drinks (currently under discussions), hopefully with improvement to address the concerns expressed by Members.

Answer A study is being conducted to enable the Gulf Cooperation Council member states ("GCC States") to revise the excise tax model under the Unified Excise Tax Treaty for the GCC. The content of the study should enable the GCC states to make a determination as to the optimal excise model that takes into account international best practice, ease of implementation, compatibility with the tax's health objectives, compliance with international obligations, sustainability, impact and burden on manufacturers and consumers, and equity. One of the models under consideration is a tiered volumetric approach to determine the tax due on a beverage based on its sugar content. Details of amendments to the excise tax will be announced once a formal resolution is issued at the GCC level amending the excise tax model.

Question 3 Japan appreciates to Saudi Arabia for providing information on the number of rights enforcement cases related to copyrights (Table 3.17) and the number of prosecution cases related to trademark rights (Table 3.18). It is stated that customs officers are authorized to seize infringing goods ex officio, however, Japan would like Saudi Arabia to provide the specific number of seizures by infringing right wherever possible. In addition, Japan would like Saudi Arabia to provide the number of administrative seizures for each infringing right, to the greatest extent possible.

Answer The number of the IP cases were (99) in the last (2) years.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 4 Japan understands that Saudi Arabia is in the process of reviewing and revising the IP legislation and seeking public feedback on the draft of the new legislation. Japan would like Saudi Arabia to provide details on the outline of the new legislation and the status of public feedback.

Question 5 In 2015, the Government of Saudi Arabia newly established SASO2857 (the latest version is the SASO2857:2016) as a regulation to regulate tyre rolling resistance and wet grip, referring to the UN R117-02. Meanwhile, the GSO introduced the legislation which is different from the one by Saudi

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Arabia in 2016. Similar to the SASO2857, there are two legal requirements, concerning rolling resistance and wet grip requirements, and the threshold are based on the UN R117-02.It seems that Saudi Arabia has its own standards and technical regulations at the national level when it is necessary. Could Saudi Arabia explain the reason why tyres with 3PMSF are not acceptable in the Kingdom of Saudi Arabia? Also, although the GSO allows 3PMSF tyres, they are not accepted in Saudi Arabia. Could Saudi Arabia explain if there are any specific reasons for this?

Answer KSA proposes discussing this inquiry and the technical issues associated with it within the framework of the Technical Barriers to Trade (TBT) Committee.

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KAZAKHSTAN

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1

According to Table 3.10, in the new edition of the Competition Law, public institutions and state-owned corporations are excluded if the institution or corporation is solely authorized by the Government to provide commodities or services in a particular field. Could the Government please specify these fields and what types of activities of such bodies are excluded?

Answer The exception is conditional to whether the entity is solely owned by the Saudi Government and solely authorized to provide a commodity or service. Currently it is not being applied to any entity.

Question 2

According to paragraph 3.24. of the Report, the direct transport is required for maintaining the preference. Are there any commonly recognized exceptions to this rule, for example, for geographical reasons, transport requirements, etc.?

Answer There are no exceptions to such requirement.

Question 3

According to paragraph 3.49. of the Report, the members of GCC have been developing a common list of prohibited or restricted products. Hence, could you please inform on the latest updates on the development of the list mentioned?

Answer Meetings with the competent authorities are on ongoing to study and review the list of prohibited and restricted goods that are restricted to import and export in coordination with the Ministry of Commerce, in addition to meetings that take place by the Secretary General of the Gulf Cooperation Council to review the lists of restricted and prohibited goods, and no agreement has been reached to date.

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KOREA

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1

Pages 24, 36, 104-105 (Para 2.8, 2.62) 1.4. Other goals of Vision 2030 include: […] (ii) increasing domestic production and government procurement through local content measures;

2.8. Vision 2030 is developed around three main themes, namely: a vibrant society; a thriving economy; and an ambitious nation. For each theme, the plan sets out specific objectives, programmes, and measurable targets to be achieved by 2030.10 Under the theme "a thriving economy", multiple initiatives are envisaged. These include: […]; increasing domestic production and procurement through local-content measures; […]

2.62. In recent years, the Government introduced new local content measures in a bid to increase sourcing of domestic goods and services. Vision 2030 sets out ambitious objectives for increasing local content in the oil and non-oil sectors of the economy. Under the National Industrial Development and Logistics Program (NIDLP), local content is considered a key enabler for boosting domestic demand, GDP growth, and job creation. […]

4.97. Vision 2030 provides that the strategic objective of growing and diversifying the economy will be achieved through, inter alia, measures to unlock the potential of non-oil sectors, including through localization of promising manufacturing industries.121 In addition to initiatives aimed at promoting local content in specific sectors of the industry122 through procurements made by the Government, the NIDLP sets out a cross-cutting, horizontal local content strategy.123 The Local Content and Private Sector Development Unit, established in 2016, was replaced in early 2019 by the Local Content and Government Procurement Authority (LCGPA), whose mandate is to develop local content in government procurement and to enhance its efficiency.

It appears that Saudi Arabia maintains a number of local content requirements (LCRs) under Vision 2030 to boost its domestic industries across sectors. Could Saudi Arabia please provide more information on its LCR measures in detail, including:

(i) whether they apply exclusively to government procurement or whether there are other areas subject to the said measures (as it appears so according to para. 4.97 of the WTO Secretariat's report WT/TPR/S/407), and (ii) which industries have been actually subject to such measures?

Further, could Saudi Arabia also share its position on the WTO consistency of such measures, particularly in terms of GATT Art. III:4, III:5, and the TRIMs Agreement?

Answer (i) Local content requirements set out in the Council of Ministers’ decision No 245 dated 29/3/1441 apply on government contract only. (ii) all industries are subject to local content requirements within the framework of government proqurement. Saudi Arabia ensures that all Local content requirements set out in the Council of Ministers’ decision No 245 dated 29/3/1441 are consistent of with GATT Art. III: 4, III: 5 and the TRIMs Agreement.

Question 2

Page 33 (Box 2.1 Investment principles) 1. Ensure equality between Saudi and non-Saudi investors, and among non-Saudi investors. 2. Ensure the protection of investments, in line with the Kingdom's regulations. 3. Enhance the sustainability of investments, and deal with investor complaints in a transparent manner. 4. Provide investment incentives when needed, and ensure full transparency when granting them. Provide a list of investment incentives and grant them in accordance with general, clear, and non discriminatory criteria.

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5. Maintain environmental and social standards in order to ensure that Saudi and non-Saudi investors comply with regulations regarding labour, health, and environmental safety, in accordance with national regulations and policies and the international conventions to which Saudi Arabia has acceded. 6. Facilitate entry procedures for non-Saudi employees, including technicians, administrators, and their dependents. Arrange their residency in the Kingdom to facilitate their participation in activities related to foreign investment, in accordance with the Kingdom's regulations and its international obligations. 7. Transfer and localize science and technology resulting from foreign direct investment, in accordance with the Kingdom's international obligations.

In spite of the written principles for investment, effective incentives (e.g., tax benefits) are lacking, but restrictions and duties (e.g., Saudization) are being strengthened. Could Saudi Arabia give a clear explanation on the principles, especially in terms of which incentives are provided to investors?

Answer Kindly refer to Para 2.51 of SEC report and Para 2.22 of GOV report and for further information kindly visit MISA website.

Question 3

Page 35 (2.60) 2.60. Foreign investors have the right to transfer abroad profits, capital gains, funds derived from the sale of equity, and any amounts required to settle contractual obligations pertaining to their investment. Resident companies in Saudi Arabia that are wholly owned, either directly or indirectly, by foreign investors (i.e. non-Saudi and non-GCC natural or juridical persons) are subject to corporate income tax on profits and capital gains at a flat rate of 20%. Whereas resident companies that are wholly owned, either directly or indirectly, by Saudi or GCC nationals, with no non-GCC entity in the ownership structure, do not pay corporate income tax but are subject to a religious levy on net assets, called Zakat, at a rate of 2.5%.61

Foreign investors pay a 20% corporate income tax on profits. The ratio is quite high compared to KSA and GCC companies which pay Zakat, at a rate of 2.5%. Is there any possibility of adjusting its ratio to attract more FDI?

Answer Corporate income tax on profits and capital gains at a flat rate of 20%, In accordance with the Kingdom's accession commitments.

Question 4

Pages 36 (Para 2.63) Foreign investors must also comply with the Government's Saudization policy (Nitaqat), a long-term plan aimed at increasing the proportion of Saudi employees (including women) in the economy. (Footnote 63) The policy requires companies to employ a certain percentage of Saudi citizens, which ranges from 5% to 75% based on the nature of the business, the work conditions, and the availability of Saudi employees in the field. Foreign investors must include their Saudization levels when submitting their investment plans for approval. There are also limits on the number of visas for foreign workers available to companies. Reportedly, in recent years, Saudization measures have been reinforced, by requiring that only Saudi citizens be employed in certain economic sectors (such as mobile phone stores, car rental agencies, and retail sales jobs in a dozen sectors). (Footnote 64) Additionally, since the last Review, the Government has implemented new fees for expatriate employers (which are paid per employee per month). It has also increased levies on expatriates with dependents, and imposed higher fees for business visas and entry/exit permits for foreign workers.

In the engineering sector, companies are required to employ more than 20% of Saudi Arabian citizens among the total workforce. However, it is very difficult to hire competent engineers with reasonable salaries. Does the government have any plans to cultivate more engineering personnel?

Answer The policy was announced to tackle the rising unemployment among local engineers and it is carefully taking into consideration the supply of local engineers and the impact on the private sector.

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In addition, the government has provided a range of services that can help firms hire, train and retain local engineers to minimize any adverse effect of private sector firms.

Question 5

Page 44 (3.31) 3.31. In April 2020, the Government raised import tariffs on certain goods, including dairy products, juices, vegetables and olive oils, chemicals, building materials, and vehicles. The changes took effect in June 2020."

Last year, the Saudi Government increased import tariffs on specific products (for about 1,390 products) by 1.5 to 15%p. Is there any specific reason for this increase and would there be any room for adjustment in the future?

Question 6

Pages 96 (Para 4.59) Saudi Aramco's In-Kingdom Value Added Program aims to achieve 70% localization of its spending by 2021. (Footnote 80)

(Footnote 80) IKTVA. Viewed at: https://iktva.sa/.

To satisfy the 70% localization ratio in the energy sector by 2021, reasonably priced products with high quality will have to be supplied sufficiently. Would you please explain the government's plan to expand the manufacturing base in Saudi Arabia?

Answer The program aims to maximize economic value-added to increase the overall GDP of KSA by fostering growth of local suppliers by supporting the expansion of manufacturing base in Saudi Arabia. In support to these efforts, developing anchor projects to provide the eco-system, driving localization investments to close supply chain gaps and develop long-term procurement agreements with local manufacturers.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 7

Page 15 (Para 4.11) 4.11. The precedent environmental laws were replaced with a new law and a set of executive regulations, standards, requirements and guidelines that aim to protect, develop and sustain the environment. On the regional level, the final drafts of a unified GCC environmental and meteorological law, and an operational plan for the GCC environment strategy were developed.

Saudi Arabia’s Vision 2030 aims at modernizing and diversifying its economy. Both the government and the secretariat’s reports enumerated Saudi Arabia’s efforts in improving its business environment and emphasized its will to unlock the potential of non-oil sectors, especially the mining and energy sectors. Considering that those sectors are carbon-intensive, and acknowledging the global community’s efforts to combat climate change, could Saudi Arabia elaborate on its mitigation efforts in light of its development strategy?

Answer The mining strategy has set very specific initiative of "achieving Sustainability in the mining sector" and it is to set the expectations and the foundation of the required regulations that are going to be implemented covering Environment, health & Safety, Mine closure and Social performance.

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III. OTHER QUESTIONS

Question 8 It is clear that the customs clearance of KSA has become expedited and more efficient compared to the past and the GCC. But many companies are still asking for support for this procedure since it is different per PIC (person in charge) as some PICs request more documents which are not essential. In this case, companies need the confirmation or support of local agents or licensed customs agents which causes expenditure on the companies’ part.

Answer There is a mechanism established according to which the direct clearance mechanism is adopted for imports, unless there is a suspicion that the documents are not in conformity with the true information of the consignment. This has a positive impact by saving much time, which in turn expedite the clearance process. In addition, the General Customs Authority urges importers to submit all consignment- related information and documents prior to its arrival, so that the goods’ documentary procedures can be completed, i.e. it adopts a copy of the documents under which the clearance of consignments may be initiated until the documents are available. This has significantly contributed to the timely flow of commercial traffic, starting from the prior submission of all information by the importer and ending by the clearance final stages.

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MALAYSIA

I QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 1

2.4 Investment regime [Page 8]

2.22. The Ministry of Investment (MISA) has facilitated the issuance of a foreign investment license by reducing the issuance period to 20 minutes, and the number of required documents to only two documents. In addition, it provides most of its services electronically.

Can the Kingdom of Saudi Arabia clarify what are the two (2) documents required for approval of foreign investment license? Is this applicable to all sectors?

Answer 1- A copy of the commercial registration of the shareholding partner 2- Financial statements of the last financial year of the applicant Which is applicable to all sectors

Question 2 3.3 Sanitary and Phytosanitary Measures (SPS) [Page 11]

3.24. Saudi Food & Drug Authority (SFDA) has issued requirements and conditions for importing food products to Saudi Arabia, which aim to; clarify conditions and requirements for competent authorities in exporting country, clarify the responsibility of the competent authorities in the exporting countries towards verifying the compliance of their establishments, and ensure food safety and facilitate the movement of trade.

3.25. SFDA has issued the approval framework for control authorities and establishments exporting fish and other aquatic products to the Kingdom. This framework aims to verify the procedures of the official regulatory authority that is responsible for food safety in these countries, as a perquisite for its authorization to approve fishing, processing facilities and farms.

The paragraphs above made no mention on the requirement for SFDA or any competent authorities to approve establishment(s) which export fish and fishery products to Saudi Arabia through an evaluation of an on-site audit by the authority.

Could the Kingdom of Saudi Arabia please update on the implementation of the approval framework that would require for on-site audit be conducted, especially during this COVID-19 period.

Answer Fish and fishery products exporting establishments will follow the same procedure that is mentioned in the “process for approving foreign competent control authorities and establishments interested in exporting food products of animal origin to the Kingdom of Saudi Arabia (KSA)”. Also it is mentioned in paragraph 3.2.3 that “The self-audit form will be evaluated after it is received officially and a visit will be arranged to the establishments interested to be approved by the SFDA in coordination with the competent control authority in the exporting country.” Also, refer to Article 8 of the conditions and requirements: Auditing the Competent Authorities in the Exporting Countries, as the requirements for the visit is mentioned.

Question 3 4.5.1 Manufacturing [Page 17]

4.31. The General Authority for Special and Economic Zones (Modon) has paid great attention to the development of industrial cities in the various regions of KSA, to make available industrial lands to all investors wishing to establish industrial projects. It also has established ready-built factories for investors, entrepreneurs and owners of small and medium enterprises (SMEs). The number of those factories developed over this period to reach 407 factories of various sizes ranging between 700- 1500 m2 within several industrial cities.

What are the sectors targeted for Special and Economic Zones (Modon) and from which countries?

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Answer Modon works along with other national agencies in the attraction efforts of all target sectors, mainly to ensure that its infrastructure is prepared to address the challenges facing all targeted sectors. The following are the sectors that Modon actively works on their attraction:

• Pharma. • Military. • Food processing and Aquaculture. • Machinery and equipment. • Metals.

In this regard it is relevant to notice that Modon is engaged in formulating its national initiative for Food Clusters that will also cover the aquaculture sector during the course of the year. Modon has worked intensively to develop infrastructure and services, including cold storage solutions to support the Food sector across its industrial cities.

Question 4

4.5.1 Manufacturing [Page 17]

Are there any incentives provided by the Kingdom of Saudi Arabia to encourage digitalisation of industries in the country? If yes, please provide explanation on the incentives.

Answer SIDF provides package of enablers to motivate current factories in all industrial sectors to adapt energy efficiency and digital transformation applications. These enablers include extending the grace period up to 24 months, payback in more than 7 years and quick evaluation to be less than 8 weeks.

Question 5 4.6.2 Tourism Services [Page 21]

4.61. The National Tourism Strategy contributes to Vision 2030 objectives through achieving the following :

• Increase international and domestic trips to more than 100 million a year by 2030 including 37 million religious trips ; • Targets the 15th international tourism destination by 2022 (1st in destination in Middle East); • Promote tourism beyond religious purposes and share a wide range of unique experiences.

With the exception of spiritual tourism, what are the types of tourism promoted by the Kingdom of Saudi Arabia and incentives offered to attract investment in these types of tourism?

Answer With the exception of spiritual tourism, the types of tourism promoted by KSA are Leisure and Business events. In addition to the services offered by the Ministry of Investment to support and facilitate foreign Investment, the Ministry of Tourism offers deep market intelligence, relationship management services and access to opportunities across the Kingdom.

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Question 6 3.2 Technical Barriers to Trade (TBT) [Page 11]

3.20. In order to protect commercial facilities from fraud and tampering with technical documents, in addition, ensure products are free from defects that may affect the health, safety, and environment of the consumer ; Saudi Standards, Metrology and Quality Organization (SASO) introduced "SABER" platform. SABER automated tracking of products, technical processes involved in the supply chain and raising products' safety levels.

Does the SABER platform also recognize standard or certification bodies from other Members and what are the examples of products that are covered under this platform?

Answer Certification bodies from other members can be recognized by SASO after completing all registration requirements. Please visit the website below to find the requirements for each HS-code covered by saber, and note that you can search by using the first 6 digits since it is matching the international HS-code: https://saber.sa/home/hscodes Please contact CABS REG Department for more information: [email protected]

Question 7 3.3 Sanitary and Phytosanitary Measures (SPS) [Page 11]

Should an exporting Member be queried about the health and nutritional attributes of a certain product, is there a platform or contact point where the exporting Member can clarify, verify and disseminate the proper information regarding the particular product?

Answer Due to Covid-19 circumstances, SFDA established a risk assessment approach where it evaluates each request that received from each establishment and decide whether a documentation evaluation, online inspection or onsite inspection will be applied. However, SFDA has evaluated the previous request which was received from the Malaysian side and SFDA already approved sea caught fishery products establishments and the decision was published on SFDA website.

II. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 8 Summary [Page 7]

3. Saudi Arabia's dependence on oil entails certain structural weaknesses, as reflected in, for example, the high unemployment rate among Saudi nationals. Recognition of such structural challenges led to the launch, in 2016, of "Vision 2030", a comprehensive strategy designed to modernize and diversify the Saudi economy. Vision 2030 encompasses a wide range of policies to create more private-sector jobs for Saudi nationals, increase the participation of women in the workforce, support small- and medium-sized enterprises, increase investment in non-oil sectors and promote non-oil exports, increase domestic production and procurement through local-content measures, privatize state-owned assets and government services, deregulate the energy market and reform energy and water prices, improve the business environment to attract foreign and local investment, and develop new infrastructure. Vision 2030 also envisages enhancing the efficiency of government, including through accelerating decision-making processes and further developing e-government services, embracing standards of transparency and accountability, monitoring performance, and improving the management of public finances. Some commentators raised questions regarding the level of ambition reflected in some of the Vision 2030 objectives. The scale and pace of implementation of Vision 2030 could be affected by the impact of the COVID-19

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- 90 - pandemic on government revenue and expenditures. The authorities indicated in the context of this Review that Vision 2030 is currently being reviewed. The Secretariat Report highlighted that Saudi Arabia's implementation timeline for Vision 2030 was affected by the COVID-19 pandemic. Will the revised Vision 2030 delay the timeline even further? Or will Saudi Arabia remove/modify some of the objectives to meet its current Vision 2030 timeline?

Answer The Vision 2030 includes several Vision Realization Programs (VRP) which go through a regular refreshment/update cycle each certain period. While some changes in terms of the approach occurred in some strategies in light of the Covid-19 pandemic, the vision 2030 targets and objectives remain the same

Question 9 1.6.1.2 Services trade [Page 21]

1.25. Balance-of-payments data indicate that Saudi Arabia is a net importer of services, with a deficit averaging USD 61.0 billion per year during 2015-19, peaking at USD 73.6 billion in 2015. However, services exports increased significantly during the same period, from USD 14.5 billion in 2015 to USD 24.2 billion in 2019 (Table 1.3). Saudi Arabia is a major site for religious tourism, with millions visiting the country to perform the Hajj and Umrah pilgrimages to the holy city of Makkah. On the import side, government-related services constitute almost a third of services imports, followed by transport (22.5% in 2019) and travel (19.2% in 2019).

Does the Kingdom of Saudi Arabia have any specific plans to reduce the services trade deficit in the country? If yes, please provide explanation on the plans.

Answer The kingdom of Saudi Arabia prepared a national trade in services strategy which included and aligned all services sectors’ strategies in this national strategy to ensure coordination, cooperation and coherence. In addition, the Kingdom had autonomously liberalized several services sectors to allow 100% foreign ownership to attract FDI’s in these sectors.

Question 10 1.6.2 Trends and Patterns in FDI [Page 22]

1.27. In line with Vision 2030, Saudi Arabia is implementing several reforms to attract larger FDI inflows, including approving the investment policy principles to encourage local and foreign investment (Box 2.1). During the review period, several activities were removed from the negative list and opened to foreign investment (Section 2.4).

The Kingdom of Saudi Arabia allows 100% foreign investment on the retail and wholesale sectors, transportation, engineering services and associated consultations and private health institutions.

What is the profile of the above activities? (e.g.; players, capabilities, competitiveness level)

Answer The profile of the above activities is Land transportation, healthcare, media, cinemas and education. Each sector or subsector that was fully liberalized had its own reasons and rationale. Transportation and logistics; Location at heart of major global trade routes complemented by significant government investment and series of reforms to liberalize new sectors to foreign investors. Healthcare and life sciences; A growing, wealthy population and major government investment leading to growing demand for healthcare services. Tourism, Culture, Entertainment and sports; Significant social and economic reforms unlocking new sectors to international investors. Tourism visa scheme launched on September 27th, 2019. Comprehensive social transformation is already underway, with opening of cinemas, over 5,000 live events across 56 cities, 500 entertainment companies started, and 20,000 jobs created in this sector in 2018.

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Education; Significant reforms aiming to boost educational outcomes creating opportunities for private sector suppliers.

Question 11 What were the considerations taken in opening up the above activities to 100% foreign entry?

Answer • Increasing the level of competiveness between the current players in the market • Economic forecast for the new sector, with high demand for new projects induced by public and private sector programs • Introducing new technology and innovation solutions by the newly entered international investor

Question 12 What were the facilities and programmes undertaken in attracting foreign investment into the above activities?

Answer Each sector has its own relative programs and facilities that will help in achieving the attraction and development of International investments. Below are some examples of these programmes: • Launched the Authorized Economic Operator (AEO) program, which offers customs advantages to trusted businesses (customized pathways) • Lunch of Human Capability development program to help achieve the education sector objectives under Vision 2030

Question 13 What were the facilities and programmes undertaken to assist local companies to compete in the more open market?

Answer Several entities in the Saudi government plays a major role in enabling investment development by both local and international players alike, and that includes but not limited to: 1. Saudi Export Authority to enable Export credit, financing, guarantee and insurance. 2. Industrial zones authorities such as MODON which provides all the required infrastructure and utilities. 3. Saudi Industrial Development Fund and Small and Medium enterprises provides the required financial programs in a commercial basis. 4. Human Recourse Development Fund which provides Saudi employment funding programs.

Question 14 What is the success rate and impact on both foreign and domestic investment?

Answer Recognition of Business Environment Advancement • Within two years, Saudi Arabia has implemented 45% of more than 300 economic reforms identified. • Ranked the top reformer and improver among 190 countries according to World Bank in 2020, thanks to its serious commitment to improve regulations in crucial areas such as electricity supply, protection of minority investors, trading across borders and enforcing contracts.

Question 15 1.6.2 Trends and Patterns in FDI [Page 22]

1.28. Moreover, in 2019, the Saudi Arabian General Investment Authority (SAGIA) was transformed into the Ministry of Investment (MISA) to add power and capacity to help increase Saudi Arabia's effectiveness in attracting local and foreign investments. MISA implemented, inter alia, the following reforms: reduced the foreign investment licence requirements to two documents; launched instant licence and renewal; automated post services (licence renewal, company activities amendment, adding branches); reduced the time to issue new licenses (from an average of 53 hours to less than 4 hours); and extended the validity of the foreign investment licence to five years (rather than being renewed annually).

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Based on the report, Saudi Arabian General Investment Authority (SAGIA) was transformed into the Ministry of Investment (MISA) in 2019. What is the enhancement made in the structure of MISA to give it more power and capacity to attract investment?

Answer MISA will continue the mandate previously undertaken by SAGIA but will also enjoy increased powers and authority on the full-investment ecosystem in Saudi Arabia. MISA has been given an expanded mandate as the caretaker of Saudi Arabia’s full investment ecosystem, in charge of with re-energizing the Kingdom’s private sector and positioning Saudi Arabia as an attractive destination for international and local investors for doing business.

Question 16 3.2.3.1 Export prohibitions [Page 51]

3.74. In response to the COVID-19 pandemic, Saudi Arabia took some temporary measures to prohibit exports of some products. These measures ensure the supply of goods necessary for preventing a critical shortage of essential products and for preserving human health. The products subject to the temporary export prohibition include personal protective equipment for safeguarding against the spread of disease, medical equipment, and pharmaceutical products.

When will The Kingdom of Saudi Arabia lift the temporary export prohibition on personal protective equipment, medical equipment, and pharmaceutical products?

Answer The Saudi Food & Drug Authority (SFDA) is currently issuing permits on the export of medical supplies and equipment relevant to the temporary measures against the outbreak of Covid-19 (“Coronavirus”), for the excessive quantities required to supply the national needs. These measures are expected to be lifted after the demise of Covid-19, due to which these measures have been taken.

Question 17 3.2.5 Special economic zones (SEZ) [Page 55]

3.89. Currently, the Economic Cities Authority (ECA) and the SEZ Authority are in the process of approving three SEZs:

• Jazan City, dedicated for Primary and Downstream Industries in the Southern Area, is operated by the Royal Commission for Jubail and Yanbu. It provides a wide range of support to manufacturing food industries, manufacturing metal industries (iron, titanium, etc.), and supporting logistics. • Ras Al-Khair Industrial City, located in the Eastern Province and operated by the Royal Commission for Jubail and Yanbu. It will create a global complex for marine industries and services, including manufacturing and ship servicing and marine oil platforms. • King Abdullah Economic City at Rabigh Governorate. It will provide a centre for logistics, light industries, pharmaceutical industries (medicines and bio-products), and medical appliances. It will be the first SEZ operated by the private sector (Emaar, a real-estate development company).

When will the King Abdullah Economic City start operating?

Answer King Abdullah Economic City KAEC is lunched and running since 2010 but the special economic Zone (60 sq2) within KAEC will be lunched end on 2021.

Question 18 3.3.6 Government Procurement [Page 69]

3.164. On 16 July 2019, the Council of Ministers approved the new Government Tenders and Procurement Law (GTPL) by Royal Decree No. M/128 of 1440H. It supersedes most of the previous GTPL issued under Royal Decree No. M/58 dated 04/09/1427H. The key objective of the new Law, which came into force on 1 December 2019, is to strengthen government procurement activities

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- 93 - while protecting public funds and enhancing economic development, with an emphasis on integrity, fair competition, and transparency.

3.165. The new GTPL also aims to support SMEs and increase local content in government procurement contracts. The conditions to benefit from local content and SMEs' preferences are generally to supply locally made products, hire locals, conduct R&D, and include other elements of local content, as well as to be registered as an SME for SMEs' preferences.132.

How can Malaysia and Saudi Arabia work together under this initiative in order to improve trade relation between the two countries ?

Answer The Kingdom of Saudi Arabia welcomes foreign investment and encourages fair competition from all WTO members.

Question 19 If there are any Malaysian companies awarded with the government project, will they be allowed to secure funding from the local financial institutions ?

Answer It may apply.

Question 20 The improved transparency will definitely encourage more foreign companies to bid for government tenders. Will tenders also be available for participation by other countries on a G2G basis ?

Answer Based on article 3-2 of the Government Tenders and Procurement Law (GTPL), Government agencies shall, before contracting with foreign persons to carry out the procurements or works inside the Kingdom, ensure the unavailability of more than one local person qualified to carry out the said works and procurements.

Question 21

Is there any regulations related to preferences in Government Procurement such as local content and SME enacted based on the provisions provided under Article 96 of the new Government Tenders and Procurement Law (GTPL) by Royal Decree No. M/128 of 1440H?

Answer Yes, regulation of governing the prioritization of local content, local small- and medium-sized enterprises and companies listed in the Saudi Capital Market for awarding works and procurements within the scope of government procurement was issued by Council of Ministers Decision No 245 dated 29/3/1441.

Question 22 3.3.6 Government procurement [Page 70]

3.170. Also, in line with Vision 2030, the new GTPL empowers the LCGPA to enter into contracts on its own volition for the Saudization of an industry or for knowledge transfer. Further, procurement contracts entered into under the new GTPL may include provisions on knowledge transfer, training, and the transfer of operating skills to employees of the government entity. The new GTPL also reflects some core principles of Vision 2030 in providing for a new form of government contract to encourage the best idea, design, or other form of intellectual property right through competition. This approach is consistent with Saudi Arabia's goal to become a hub for R&D activities to help grow the non-oil sector.

Appreciate if Saudi Arabia could further explain how the new form of government contract to encourage the best idea, design, or other form of intellectual property right through competition is operationalized and put into practice.

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Answer The new form shall be in the manner of a competition with the aim of preparing designs, plans, models, or other artistic and intellectual works. The prize is awarded to the winner, provided that their number does not exceed three.

Question 23 3 3.3.7 Intellectual property rights [Page 72]

3.183. Under Vision 2030, Saudi Arabia is building innovation labs and platforms, and engaging in initiatives to encourage entrepreneurship. This approach was underpinned by the reforms undertaken in the IP administrative regime during the review period. For example, in 2020, the Saudi Authority for Intellectual Property (SAIP) requested public consultations on a draft regulation for IP licensing, and launched a network of 33 IP support centres, and, in 2019, it began preparations for the development of a national IP strategy.

Appreciate if Saudi Arabia could share examples of the most successful outcomes of the innovation labs and platforms.

Answer • 65033 is the total number of beneficiaries across three innovation centers • 23 prototypes for entrepreneurs • 68 MSMEs have implemented innovative solutions • 50+ startups have been incubated across innovation labs

Question 24 3 3.3.7 Intellectual property rights [Page 72]

3.184. Since the declaration of the precautionary and preventive measures against COVID-19 in 2020, the SAIP has delivered 19,990 different actions via its virtual platforms and provided 17,546 actions to its individual and institutional customers. The SAIP also organized 44 sessions of quasi-judicial committees to adjudicate violations of IPRs. Additionally, it provided training courses for more than 500 beneficiaries from 28 government and private sectors. SAIP also provided a package of exceptions to support its clients in accordance with rules stipulated in international treaties and national regulations. For example, the SAIP extended deadlines of some services until 3 May 2020, due to the COVID-19 pandemic, which supplemented its statement regarding business continuity due to the crisis.

Appreciate if Saudi Arabia could clarify the nature of actions provided to its individual and institutional customers via its virtual platforms. What IP related barriers were addressed under these measures ?

Question 25 4.3 Manufacturing [Page 104]

4.96. The National Industrial Development and Logistics Program (NIDLP) approach to industrial development leverages high domestic and regional demand to catalyse growth in clusters of promising industrial sectors, optimizes the economic value captured from Saudi Arabia's natural resources, and involves the development of new clusters of transformative industries. The new industrial policy is reflected in a comprehensive and detailed National Industrial Strategy (NIS) focusing on nine sectors: (i) equipment and machinery; (ii) renewable energy supplies; (iii) pharmaceutical manufacturing; (iv) medical supplies; (v) the automotive sector; (vi) oil- and gas- adjacent industries; (vii) food processing; (viii) the aviation industry; and (ix) military industries. The selection of these sectors appears to be motivated by, inter alia, the fact that because of high domestic demand and dependence on imports they offer substantial opportunities to attract foreign and local investors to develop local manufacturing capacity. In each sector covered by the

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NIS, the NIDLP sets out in detail the existing situation and context, objectives and strategy, specific initiatives, and relevant agencies involved in the implementation of the NIS. The authorities note that the NIS is currently being updated. Implementation of the NIS is one of the main mandates of the recently created Ministry of Industry and Mineral Resources. In this regard, a new entity, the National Industrial Development Center, was established in August 2020.

One of the sectors which The Kingdom of Saudi Arabia is looking to develop is pharmaceutical manufacturing. Appreciate if The Kingdom of Saudi Arabia could indicate the category of pharmaceuticals which will be produced.

Answer The Kingdom looks into the followings: • Upscale current capabilities on Generics. • Venture into higher value add categories such as the bio-pharma. It worth noting the that the National Industrial Strategy is currently being updated.

Question 26 Summary [Page 8]

11. Saudi Arabia introduced the value added tax (VAT) as from 1 January 2018 at a standard rate of 5%. VAT was introduced as a result of a common approach between Gulf Cooperation Council (GCC) member States. On 1 July 2020, the standard rate was increased to 15% as part of the measures adopted to deal with the economic crisis caused by the COVID-19 pandemic. On 31 January 2017, Saudi Arabia ratified the GCC Common Excise Tax Agreement and issued the Excise Tax Law and its Implementing Regulations. Two different excise tax rates apply: 50% on soft/sweetened drinks or 100% on tobacco-related products, energy drinks, and electronic devices for smoking/vaping.

The current rate for VAT in Saudi Arabia at 15% is considerably higher than UAE (5%), Qatar (5% in near future), Bahrain (5%), Kuwait (5% from 1 April 2021) and Oman (5% from 1 April 2021). Would Saudi Arabia consider revising its VAT rate to spur more economic growth in their domestic market and attract investment?

Answer Currently there is no announced plan to change the VAT standard rate (15%). The Government of Saudi Arabia regularly evaluates and reassesses the various tax it implements based on many considerations including fiscal & economic conditions, international best practices, transparency, and international standards. Should any fiscal and economic conditions require a change in the VAT standard rate, the Kingdom is ready to take the necessary action to do so.

Question 27 3.1.4.1 MFN applied tariffs [Page 44]

3.30 The highest tariff rate of 100% or the ad valorem part of 100% for mixed duties (e.g. 100% with a minimum of SAR 200 per 1,000 units) is exclusively levied on tobacco products (HS 24); followed by fruit, vegetables, and plants (up to 40%), and dairy products (up to 25%). The highest simple average applied MFN rate among agricultural goods is for the beverages, spirits, and tobacco category with 27% (Table 3.3). With regard to non-agricultural goods, petroleum products have the highest simple average applied MFN rate at 6.7%, followed by wood, pulp, paper, and furniture (6.5%); textiles (6.5%); and leather, rubber, footwear, and travel goods (6.0%).

Is there any special tariff rate provided for certified wood products in support of sustainably managed forest?

Answer The duty on wood and its products mentioned in Chapter (44) varies, since some items are duty- free, while others are subject to a duty rate ranging between 5% and 20%.

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Question 28 Table 3.4 Import Prohibitions, 2020 [Page 48]

Chapter 40 (rubber and articles thereof) is listed in the table – Based on 4-digits code there are 17 products under chapter 40. Please specify which one is prohibited to enter Saudi Arabia and what is the specific reason for that.

Question 29

Based on the listing in the table 3.4, is it prohibited by all means?

Answer 28 & 29 Chapter 40 covers rubber and its products. Yet, this Chapter prohibits the importion of the retreaded and used external tires included under the Customs Items (401211, 401213, 401212, 401219, 401220).

Question 30 4.1.3.2 Domestic policies [Page 83]

4.18. In January 2020, the Ministry of Environment, Water and Agriculture issued a new animal feed policy, replacing most subsidies to poultry farmers for imported feed (of corn and soybeans) with direct support to licensed (small) poultry farmers and per-head payments to small livestock farmers. Administered prices for barley feed were increased in early 2020, while import subsidies for hay remain in place. In 2016, SAGO became the sole importer of barley for feed, but since 2019, private firms have again been allowed to import barley, although they imported only small amounts in 2020. SAGO imported 5.2 million metric tonnes of feed barley in 2019 through international tenders, and then private-sector distributors sold it at administered prices to livestock producers.

Appreciate if Saudi Arabia could clarify if the new feed policy is also applicable to ruminants or is the new policy only for poultry?

Answer The new feed policy is applicable to small livestock producers and poultry.

Question 31 4.2.2 Energy [Page 90]

4.37. In order to grow and diversify the economy, which is one of the strategic objectives of Vision 2030 (Section 2), Saudi Arabia aims to maximize the value captured from the energy sector through: (i) increased localization of the oil and gas sector; (ii) increased gas production and distribution capacity; (iii) development of oil- and gas-adjacent industries; (iv) increased contribution of renewables to the national energy mix; and (v) enhancement of the competitiveness of the energy market. Specific plans to achieve this objective of maximizing the value from the energy sector were defined in the NIDLP, one of the Vision Realization Programs adopted in 2017 to implement Vision 2030. Energy is one of four key sectors addressed by the NIDLP.

What is Saudi Arabia's strategy to increase the contribution of renewable energies and to reduce emissions from burning fuel in transportation sector?

Answer The National Renewable Energy Program (NREP) is a strategic initiative under Vision 2030 and the Renewable Energy Initiative. The program aims to maximize the potential of renewable energy in the Kingdom. The program sets out an organized and specific road map to optimize the energy sources, economic development and provide sustainable economic stability to the Kingdom in light of the goals set for Vision 2030.

Question 32 The use of biofuels or biofuels blending has proven to reduce the consumption of fossil fuels and thus reduce carbon dioxide emissions. Is there any plan to partially replace the use of petroleum diesel with biodiesel?

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Answer The kingdom is endowed with hydrocarbons and will exhaust all attempts to improve the efficiency of its energy resources and managing emissions, in an economic and environmentally- responsible manner. Circular Carbon Economy (CCE) approach addresses all technological innovations including cleaner hydrocarbon technologies to meet the required national environmental performance.

Question 33 Table A3.2 : Products affected by standards and technical regulation, 2016-20 [Page 125]

Malaysia would like to request further information on the technical regulation imposed for the rubber- based products below:

• Group 4: Tyres (Motor-cars) [Page 126] • Group 11: Tubes, pipes and hoses of vulcanized rubber (4009) [Page 131] • Group 31: Textiled Products – Rubber thread and cord [Page 143]

Answer All adopted standards and technical regulations can be found on SASO’s official website on the following links: https://wasif.saso.gov.sa/ http://www.saso.gov.sa/en/laws-and-regulations/technical_regulations/pages/default.aspx

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OMAN

III. OTHER QUESTIONS

Question 1 We commend the Kingdom of Saudi Arabia for its electronic platform SABER. Could the Kingdom of Saudi Arabia provide us with further details about this platform and its functions?

Answer Saber E-Platform developed under the supervision of SASO, and according to the highest standards of efficiency in terms of speed of registration. Saber is an integrated e-service system that allows traders to register their enterprise and consumer products' data, registration is mandatory whether the product was manufactured locally or imported to be eligible for granting the required certificates of conformity for consumer products in the Kingdom of Saudi Arabia. Saber's Electronic Platform Features are as follows: - Improved importation experience through obtaining the certificates of conformity and shipment. - Ensure safety of the products available in the market. - Faster Clearance at borders. - One platform integrated with other entities. - Lower total cost. - Ensure that products are free from defects that may affect the health and safety of the Saudi consumer, limiting fraudulent products, reducing the required time to import products in coordination with the Saudi Customs examination, and speeding up the process of issuing the required Conformity Certificates.

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PHILIPPINES

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1

I. ECONOMIC ENVIRONMENT Para 1.13 (Page 16) SAMA is vested with the conduct of monetary policy, and its key monetary policy objective remains the stability of the Saudi riyal (SAR) exchange rate in local and global markets, complemented by protecting the stability and resilience of the financial system, expanding and deepening the financial sector, and contributing to the economic development of the country.

What are the asset allocation parameters that the SAMA considers for its reserves?

Answer The provided question is not an integral part of the secretariat report nor the government report.

Question 2

What strategies are used by SAMA to reduce negative carry?

Answer The provided question is not an integral part of the secretariat report nor the government report. Question 3

What are the asset classes allowed to invest into and possibly be included in its portfolio in the near term and in the medium to long term? Is it allowed to invest in equities? If yes, what have been SAMA's notable experiences in investing in equities?

Answer The provided question is not an integral part of the secretariat report nor the government report.

Question 4

Para 1.26 (Page 21) A key objective of Vision 2030 is to promote and facilitate foreign investment and increase its GDP share from 3.8% to 5.7%. FDI inflows declined steadily over the last decade, when they were over three times higher than today. Inward FDI averaged USD 5.2 billion per year during 2015-19, compared with an annual average of USD 18.2 billion in 2005-07, while the stock of FDI in 2019 stood at USD 236 billion.

How does Saudi Arabia collect data on direct investments? Does the country have a business registry, e.g. a corporate sector database, particularly for those corporations with FDI transactions?

Answer The requested question is not an integral part of either the secretariat nor the government reports and it’s classified outside the scope of the TPR.

Question 5

Does the Saudi Arabia Monetary Agency (SAMA) have authority to collect data from economic units that are not under their supervision, such as non-deposit taking corporations and households for statistical purposes, economic surveillance, and policy formulation?

Answer SAMA regulates and supervises the banking, insurance, finance, money changers, and payment systems oversees the statistical information over the aforementioned sectors. Moreover, SAMA coordinates with related entities to collect balance of payment data. Other financial statistics could be found within the relevant financial entities through websites or annual reports. In-depth statistics are available in SAMA’s annual reports that can be accessed here (https://www.sama.gov.sa/en- us/economicreports/pages/annualreport.aspx).

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Question 6

II. TRADE AND INVESTMENT REGIMES Para 2.18 (Pages 26-27) During the review period, there was a significant change in Saudi Arabia's institutional framework for trade policy formulation and implementation. The General Authority for Foreign Trade (GAFT) was established in January 2019 as a separate public entity to take over all the responsibilities related to foreign trade that were previously carried out by the Ministry of Commerce. The GAFT is currently responsible for all trade policy matters, including negotiating international trade agreements, ensuring Saudi Arabia's compliance with its WTO obligations, and representing the Kingdom in the WTO and other international economic organizations.

Given the relatively recent institutionalization and operationalization of the GAFT, what were the main challenges it encountered in its early stages in terms of formulating trade policy? How were these challenges addressed?

Answer Given the increasing role of foreign trade in national and international economy, GAFT was created as a specialized entity for the foreign trade mandate. The main challenge was formulating a national foreign trade strategy which incorporates several sectoral strategies. GAFT is developing the National Foreign Trade Strategy, where the strategy and its initiatives are being formulated on the basis of international and regional best practices and in consultation with private sector, aiming to achieve Vision 2030 goals and objectives.

Question 7

Para 2.39 (Page 31) In June 2017, Saudi Arabia, the United Arab Emirates and Bahrain severed diplomatic, trade, and travel ties with Qatar, including restricting access by land, sea, and air. The embargo was lifted in January 2021.

Kindly discuss the effects of the three-and-a-half year embargo of KSA, UAE, and Bahrain to Qatar and overall GCC relations.

Answer As refered in paragrapgh 2.39 the relevant measures were lifted in January 2021.

Question 8

Para 2.44 (Page 32) Some GCC member States (Bahrain and Oman) concluded bilateral FTAs, notably with the United States. In the case of Saudi Arabia, bilateral economic relations with the United States are conducted under the Trade and Investment Framework Agreement (TIFA), signed in 2003. The TIFA is aimed at improving legal protection for investors, strengthening intellectual property protection, enhancing the efficiency of customs procedures, and increasing transparency in government and commercial regulations. The GAFT is currently assessing the potential to expand the Kingdom's network of FTAs in light of the Vision 2030 goals.

What are the GAFT's key considerations in identifying potential bilateral FTA partners? Is it also looking into engaging other countries with which KSA has not initiated FTA negotiations with yet in the past?

Answer GAFT has developed FTA prioritizion for potential FTAs for current and future negotiations. Key considerations are complementarity of economies, current bilateral trade, geographic location, potential trade creation and market access opportunities for goods and services. The potential FTAs with some trading partners with whom negotiations were not initiated.

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Question 9 Kindly discuss the impact of FTAs implemented in overall GCC trade, investment, and economic relations.

Answer Saudi Arabia and the GCC have a small but robust FTAs network, this is set to change in the future as both have ambitious plans to actively expand their FTA’s network. Question 10

Para 2.46 (Page 32) Since the last Review, an Agreement on Trade in Services has been concluded among the countries of the League of Arab States. Saudi Arabia was the first to ratify the Agreement and the schedule of commitments, and it started its implementation in October 2019. However, negotiations on the implementation details of some PAFTA provisions on rules of origin and non-tariff barriers are still ongoing, as reported in the previous Review.

What are the salient features of the Agreement on TIS which the League of Arab States has concluded? How is KSA implementing its commitments under the agreement? What are some challenges encountered during the implementation of the Agreement and how are these being addressed by the government?

Answer The salient feature of the agreement is the participation of non WTO members to this agreement. The Kingdom was the first member to sign and ratify the agreement. Any challenges that may arise regarding the implementation of the agreement are to be addressed in the relevant committee (implementation and follow up committee). Question 11

Para 2.51 (Page 33) The MISA has launched several initiatives that aim to improve the investment environment and foster competition. Notably, it has issued the Consolidated Investment Plan, aimed at working closely with all relevant government agencies and leading Saudi companies to attract investment and channel it into the most promising economic sectors, while also making the traditional sectors more competitive. Other initiatives are geared towards marketing investment opportunities in the Kingdom in cooperation with the chambers of commerce. "Invest Saudi" was established as the national investment brand, with the aim of promoting investment projects in Saudi Arabia and enhancing the image of the country's investment climate. It functions as a communication platform that serves and connects all government entities engaged in investment matters. Other reforms aimed at attracting investment include the establishment of Tayseer, a government committee mandated to continuously improve the way business is conducted in the Kingdom; and the issuance of Ministerial Resolution No. 713 on public consultation with stakeholders regarding proposed legislation, which seeks to improve the transparency and predictability of business regulations.

What are the main deliverables and targets of the Invest Saudi campaign?

Answer Kindly refer to par. 1.13 of GOV report.

Question 12 What is the difference between the functions of the Ministry of Investment (MISA) and that of the Ministry of Commerce? This would help other economies in streamlining agency functions particularly those involved in investments.

Answer Regarding the Ministry of Commerce kindly refer to par. 1.7, 1.8 and 1.9 of GOV report. On the other hand, MISA facilitates access to investment opportunities by developing a vibrant cross- government investment ecosystem, while supporting businesses throughout their investment journey. Through a network of dynamic business centers across the Kingdom, MISA partners with local and international businesses of all scales and sizes—from startups to blue chip multinationals— to help make investing in the Kingdom as streamlined and simple as possible. MISA takes a lead role in improving Saudi Arabia’s overall business environment, commissioning multiple market intelligence studies every year, and developing local opportunities for joint ventures.

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Question 13 Can KSA expound more on the function of the Tayseer? Are they not overlapping with the functions of MISA?

Answer Kindly refer to par. 2.51 of SEC report.

Question 14

Para 2.60 (Page 35) Foreign investors have the right to transfer abroad profits, capital gains, funds derived from the sale of equity, and any amounts required to settle contractual obligations pertaining to their investment. Resident companies in Saudi Arabia that are wholly owned, either directly or indirectly, by foreign investors (i.e., non-Saudi and non-GCC natural or juridical persons) are subject to corporate income tax on profits and capital gains at a flat rate of 20%. Whereas resident companies that are wholly owned, either directly or indirectly, by Saudi or GCC nationals, with no non-GCC entity in the ownership structure, do not pay corporate income tax but are subject to a religious levy on net assets, called Zakat, at a rate of 2.5%. However, if the activity of the resident company is in the hydrocarbons and natural gas industry, only the corporate income tax is levied, regardless of the nationality or origin of its shareholders. Withholding taxes are applied to payments made to any non-Saudi resident who derives income from a source in Saudi Arabia; the withholding tax rate ranges from 5% for dividends and technical services to 15% for transfers to related parties, and 20% for management fees. There are no taxes on personal income.

May we confirm if the government of Saudi Arabia does not implement any foreign exchange (FX) restrictions/regulations such as the need to register foreign investments in order to be eligible for the repatriation of capital and remittance of related-earnings using FX from the banking system. Pursuing FX reforms on these areas, such as streamlining the registration process, may help attract foreign investments if such regulations exist.

Answer Saudi Arabia maintains an exchange rate system free of restrictions on the making of payments and transfers for current international transactions. Saudi Arabia related regulations are in line with Article XI (Payment & Transfers) of the GATS agreement.

Question 15

III. TRADE POLICIES AND PRACTICES BY MEASURE Para 3.3 (Page 39) During the review period, Saudi Arabia introduced important changes in customs procedures; notably, the SCA enhanced an electronic data interchange system, an electronic trade single window that allows electronic submission and processing of import declarations. Moreover, Saudi Arabia implemented a new risk management system and targeting centre to classify the shipments based on their risk level, launched both an online platform for the certification of imported goods and a truck reservation service at its seaports, and upgraded its infrastructure at Jeddah. Saudi Arabia now has a country-wide single window for customs procedures.

Are there plans to establish a GCC-wide single window system for customs procedures? If so, what are the key considerations and foreseen challenges to operationalize such mechanism?

Answer The unified platform for import and export clearance is established for Saudi Customs and its partners including other relevant governmental authorities in the Kingdom. It is not currently linked to the customs authorities of GCC countries; there are no current plans to change that.

Question 16

Para 3.15 (Page 41) There are no legal provisions pertaining to advance rulings. According to the authorities, the SCA answers, on a case-by-case basis, requests for information on customs matters such as classification, valuation, and rules of origin.

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Why is the issuance of Advance Rulings (AR) not part of Saudi Arabia's current customs procedures/legal provisions? Are there future plans to adopt same for transparency and trade facilitation purposes?

Answer There is a Saudi customs procedures /legal provisions of issuance Advance Ruling, which is the Unified Guide adopted by customs administrations in the GCC Member States.

Question 17

Para 3.61 (Page 49) Under the GCC Common Law, the determination of injury is based on the overall market of the GCC member States. Under the 2010 amendment to the GCC Common Law, the following institutions were established to deal with trade remedy issues within the GCC market: the Ministerial Committee, the Permanent Committee, the Cooperation Council for the Arab States of the Gulf, and the Bureau of Technical Secretariat of Anti-injurious Practice in International Trade (GCCTSAIP).

What are the specific roles of each institution that deals with trade remedy issues? Which is/are the investigating authority/ies?

Answer Article 8 of the GCC Common Law of Anti-dumping, Countervailing and Safeguard measures (“GCC Common Law”) provides details about the duties and roles of the Ministerial Committee, which in short, is responsible for taking the final decision on the trade remedies measures. Article 9 of the GCC Common Law provides details about the duties and roles of the Permanent Committee, which in short, is responsible for overseeing the GCCTSAIP, taking the decisions on provisional measures and undertakings, propose the final decisions on trade remedies measures, and accepting the trade remedies applications.

Question 18

Para 3.63 (Page 49) On 3 January 2019, Ministerial Decree No. 211 established the GAFT. The Trade Remedies Deputyship (TRD), under the GAFT, is responsible for all issues related to trade remedies. The Deputy Governor of the TRD is a member of the Permanent Committee and participates in its decisions. The Minister of Industry and Mineral Resources represents Saudi Arabia in the Ministerial Committee for final decision-making of trade remedy matters.

What is the interplay/relationship between the GAFT and the institutions dealing with trade remedy that were identified in para 3.61?

Answer GAFT is representing the Kingdom of Saudi Arabia in the Permanent Committee. GAFT reviews the GCCTSAIP’s reports and votes – among other GCC members- on the Permanent Committee’s decisions. GAFT also coordinates with the Minister of Industry and Mineral Resources in his representation in the Ministerial Committee in voting on the final decisions. In addition, GAFT assists the GCCTSAIP in conducting the trade remedies investigations in collecting information from Saudi market, industry and Saudi customs authorities.

Question 19

Para 3.165 (Page 69) The new GTPL also aims to support SMEs and increase local content in government procurement contracts. The conditions to benefit from local content and SMEs' preferences are generally to supply locally made products, hire locals, conduct R&D, and include other elements of local content, as well as to be registered as an SME for SMEs' preferences.

How much of government procurement contracts have been sourced locally? From SMEs specifically?

Answer The share of MSMEs contribution in government procurement has increased to 36.34% in Q4, 2020 (SAR 13.1 Bn). Despite the decrease in value of contracts in Q4, 2019 by -1.6% (SAR 13.3 Bn). The

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Question 20

IV. TRADE POLICIES BY SECTOR Para 3.182 (Page 72) The Saudi Authority for Intellectual Property (SAIP) was established under the Council of Ministers Decision No. 410 of 27 March 2017. The Decision transfers duties and responsibilities from the Saudi Patent Office (King Abdulaziz City for Science and Technology), Copyright Department (under the Ministry of Culture and Media), and Trademark Department (under the Ministry of Commerce) and unifies them under the SAIP. The Council of Ministers Decision No. 496 of 11 June 2018 sets forth the SAIP's main roles and responsibilities as: (i) preparing the national strategy for intellectual property (IP), following up on implementation after its adoption, and developing work plans and programmes in coordination with the relevant authorities; (ii) proposing laws and regulations relating to intellectual property rights (IPRs); (iii) managing the registration, grant, and enforcement of IPRs; (iv) providing information to the public; (v) raising awareness regarding IP and IPR protection; (vi) representing Saudi Arabia in international and regional organizations and defending its interests; (vii) providing opinions on international agreements related to IPRs; (viii) following up on the implementation of the obligations resulting from Saudi Arabia's accession to international conventions relating to IP; (ix) promoting the use of IP to build an advanced knowledge-based economy; (x) establishing databases related to the SAIP's work and exchanging information with local, regional, and international authorities; and (xi) licensing of related activities.

We would like to request further information on the responsibility of SAIP to "provide opinions on international agreements related to IPRs" particularly, on the nature of such opinions (i.e. whether the opinion is legally binding), and the SAIP clients requesting for such opinion.

Answer SAIP responsibility is to study and provide opinion to the Saudi council of ministers on the advantages and commitments of IPR treaties such as accession, economic impact and legislative modification.

Question 21

Para 3.192 (Page 74) The Regulations of Optional Copyrights Registration issued by the SAIP's Board of Directors Decision No. 03/07/2019 dated 07/06/1440H (12 February 2019) provide registration services for architectural designs and computer software and applications. Under Article 3(3) of the Regulations, registration services may be extended to include other types of copyrighted works by a decision of the Chief Executive of the SAIP.

What is the advantage of the registration of architectural designs and computer software applications and is such registration a requirement?

Answer The right holder is protected even without having his/her work registered. The purpose of the optional copyright registration is to establish a public record of Ownership and in case of disputes, the owner of the registration can use an official document to establish a presumption of Ownership.

Question 22

Para 3.193 (Page 74) Saudi Arabia's copyright laws and procedures apply to copyright infringement on the Internet. Accordingly, any person within the territorial jurisdiction of Saudi Arabia who infringes copyrighted works on the Internet shall be subject to one or more of the following penalties: (i) a warning; (ii) a fine not exceeding SAR 250,000; (iii) closure of the establishment that participated in the infringement for a period not exceeding two months; (iv) confiscation of all copies of the work in addition to the materials used, or intended for use, in the infringing acts; or (v) imprisonment for a period not exceeding six months (Article 22 of the Copyright Law). How does Saudi Arabia enforce the penalties if the infringer is located outside of Saudi Arabia?

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Answer If the infringer is located outside of Saudi Arabia, it depends pursuant to the country's policy in enforcing foreign judgments. Moreover, Law of Procedure before Sharia Courts stated in Article (26) (a) that the Saudi courts shall have Jurisdiction over cases that are filed against non-Saudi who does not reside in the kingdom, if the case is related to a commitment existing, created or implemented in Saudi. The legal notification of the lawsuit shall be sent by the Ministry of Foreign Affairs and the legal notification will be delivered via diplomatic channels. However, if the infringer is located in a country which is considered to be a party of "TRIPS AGREEMENT" the agreement shall be binding on the state parties and the enforcement shall be applied against the infringer.

Question 23

Para 4.104-4.105 (Page 106) As part of Vision 2030, the Financial Sector Development Program (FSDP) aims to develop a strong, innovative, and stable financial sector, able to support private-sector growth through lending, new services, and an advanced capital market, while promoting and enabling financial planning in society more broadly. In this role, the financial sector is seen as essential, allowing the private sector to drive the diversification and development of the economy. Therefore, the authorities consider financial-sector development critical to achieving the Vision 2030 objectives.

The Saudi Central Bank (SAMA) regulates and supervises financial services, while the Capital Market Authority (CMA) regulates capital markets. During the review period, the regulators implemented a large number of reforms, aimed at increasing the use of electronic payments, supporting the development of the FinTech sector, and deepening capital markets. These reforms resulted in the inclusion of the Saudi Stock Exchange in three emerging market indices (Section 4.4.1.3). In 2019, financial services (comprising the banking sector, the insurance sector, and non-bank financial institutions) and business services jointly accounted for 5.6% of GDP at current prices, and financial services alone employed nearly 64,000 people.

How did the COVID-19 pandemic impact specifically the financial services sector? What regulations were issued to address these?

Answer In response to Covid-19 pandemic, jurisdictions around the world, including Saudi Arabia, have taken both health and economic measures to contain the effect of the escalating virus outbreak. As a result of these measures, economic activity across many sectors has been adversely affected including the financial sector although mostly indirectly. Financial services do not necessarily rely on physical contact with customers especially with accelerated level of digitization in the sector in recent years. The Saudi Banking sector’s asset quality was minimally impacted, where the NPL ratio remained at 2.2 percent during the third quarter of 2020. However, the system has remained comfortably capitalized, with CAR standing at 19.6 percent in the third quarter of 2020, and highly liquid.

Question 24

Para 4.113 (Page 109) Foreign banks continue to be allowed to operate in Saudi Arabia, either as a locally incorporated joint-stock company or as a branch of an international bank. In 2019, the SAMA issued revised licensing guidelines for banks under the Banking Control Law, 1966, which remains the main legislative text governing the banking sector. Under the guidelines, foreign bank branches are, in principle, subject to the same prudential requirements as locally incorporated banks. Foreign bank branches are not required to maintain capital in Saudi Arabia but, under certain circumstances, the SAMA reserves the right to impose such capital requirements. The guidelines require preliminary discussions prior to submitting a license application for review to the SAMA. The Regulations for Foreign Bank Branches were published in September 2019 in Circular No. 4922/67, and the SAMA also regulated "agent banking" in 2019. In 2020, the SAMA issued additional guidelines for digital-only banks, requiring such banks to be set up as incorporated joint-stock companies, to have a physical presence in the country, and to put in place adequate customer support.

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In terms of commercial banking activities, is there a provision under Saudi Arabia's domestic laws and regulations that limits the number of non

Answer The financial sector is very liberal and attractive to foreign investment with strong foreign participation as for foreign equity share is as indicated in the KSA Services Schedule of Specific Commitments.

Question 25

Para 4.117 (Page 110) From a regulatory point of view, banks assess and approve the Shariah-compliance of their products and services. In practice, this is done by internal (Shariah) boards within each bank. As a result, all banks are regulated using the same reporting requirements and, in principle, all banking activity is Islamic or Shariah-compliant. While there is no official classification of banks into Shariah-compliant and conventional, four banks are run completely in accordance with Shariah, with other banks offering both conventional and Shariah-compliant products. Approximately 71.5% of banking sector assets were Shariah-compliant in 2019, an increase from 51.0% in 2016.

As we are aware, many foreign workers or individuals are staying in the Kingdom. In accordance with Saudi Arabia's domestic laws and regulations, are there rulings that restrict foreign nationals to open an account with a domestic bank under Mode 2? Does it follow the same Shariah/Islamic rulings in the foregoing?

Answer According to Bank Accounts Rules issued by Saudi Central Bank, any foreign resident individual can open a bank account. There are no restrictions on individuals’ choice of Shariah-complaint or conventional banking Products.

Question 26

Para 4.124 (Page 111) In December 2018, the SAMA issued new rules for the licensing and supervision of branches of foreign insurance and/or reinsurance companies in Saudi Arabia, to support the development of a stable and resilient financial sector as part of Vision 2030. Foreign insurance and reinsurance firms are now allowed to open a branch if they meet some, primarily prudential, conditions; some applications to open a branch have been received and are under review. The SAMA also updated its requirements for appointments to senior positions in September 2019.

For the entry of foreign insurance and reinsurance firms, what are the specific prudential requirements (i.e. qualifying capital in respect of insurance liabilities and risks; risk identification and management; and reporting and disclosure) needed to open a branch in Saudi Arabia? Further, is there an acquisition requirement of the voting stock of an existing domestic insurance company? Is there a limitation in the participation of a non-Saudi Arabian resident in the Board of Directors of a locally incorporated insurance company?

Answer The specific prudential requirements needed to open a branh in Saudi Arabia are; 1-Taking into consideration the premiums retention percentage stated in the Implementing Regulation and/or SAMA’s Instructions, the Branch shall ensure that its liabilities excluding the reinsurance share- equals its assets in Saudi Arabia. There should be no transfer of money from the Branch to the Company unless it is under a service provision arrangement between the Company and the Branch that has been approved by SAMA, or retained profits shown in the annual financial position of the Branch, submitted to SAMA according to Article 15 of these Rules and after getting SAMA’s approval, provided that the Branch is in compliance with the solvency margin requirements stated in the Implementing Regulation and SAMA’s Instructions. 2-The management of the invested assets of the Branch shall be carried out by its investment department, a licensed Saudi bank or Capital Market Authority authorized person. The Investment requirements provided in the Implementing Regulation and SAMA’s Instructions shall apply to the Branch 3-Surplus distribution stated in the Implementing Regulation and/or SAMA’s Instructions shall apply to the Branch’s business.

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4-SAMA requires the Company “the foreign insurance and/or reinsurance company licensed to open a branch in KSA” to submit regular returns to demonstrate its solvency determined according to Saudi Arabian regulatory requirements. In addition, SAMA requires the Company to provide it with any decisions that affects the Branch business including, but not limited to, decisions related to the capital, solvency, and the board of directors. 5-The paid up capital of the Company has to be equal to, or more than, the amount required for a Saudi established insurance and/or reinsurance company 6-The Branch shall calculate its solvency in accordance with the solvency requirements stated in the Implementing Regulation and SAMA’s Instructions 7-Any Company, prior to commencing the Branch operations in Saudi Arabia shall place the Company’s Contribution with the Branch, as a minimum of one hundred million Saudi Riyals for insurance and two hundred million Saudi Riyals for reinsurance. The statutory Deposit percentage shall be determined based on the Standard & Poor's classifications or their equivalent, for example but limited to, AM Best, Moody's or Fitch, as follows: AAA: %10 AA: %20 A: %30 Others: %40 as minimum If a ratings downgrade occurs, the Company shall inform SAMA and deposit the balance of the Deposit corresponding to the lower credit rating within ninety (90) days of such downgrade. If the rating of the Company is upgraded, the Company may apply to SAMA to reduce the Deposit to an amount corresponding to such upgraded rating with the change taking effect one year from the rating upgrade. 8- The Branch’s gross written premiums shall not exceede (10) times the Company’s Contribution and its reserves, unless SAMA’s prior written approval is obtained 9- The Company shall evaluate and ensure the adequacy of the technical provisions of the Branch on a quarterly basis. The Company shall remain ultimately liable for settling all policyholder obligations and other liabilities of the Branch 10- SAMA requires the Branch to submit regular reporting forms in a similar format to those required for local insurance and/or reinsurance companies 11- The Cooperative Insurance Companies Control Law and its Implementing Regulation, as well as SAMA’s Instructions shall govern whatever is not provided in the Rules for Licensing and Supervision of Branches of Foreign Insurance and/or Reinsurance Companies in Saudi Arabia (link to the Cooperative Insurance Companies Control Law, Regulations, rules and Instructions- including Risk Management Regulation and Insurance Corporate Governance Regulations: https://www.sama.gov.sa/en-us/laws/pages/insurance.aspx There is no an acquisition requirement of the voting stock of an existing domestic insurance company. There is no a limitation in the participation of a non-Saudi Arabian resident in the Board of Directors of a locally incorporated insurance company.

Question 27

Para 4.130 (Page 112) Investment in Saudi capital markets continues to face restrictions, despite recent efforts to increase access by non-resident foreign investors to capital markets. While investment in equity markets is open to Saudi citizens, GCC nationals, and foreign residents, direct investment in the main market for non-residents remains primarily restricted to QFIs, ultimate beneficiaries in swap agreements, and Foreign Strategic Investors. Non-GCC nationals that hold shares in public joint-stock companies traded on the equity market must still obtain permission from the CMA prior to buying or selling their shares. In terms of investment houses, what is the foreign equity limitation allowed under the Kingdom's domestic laws and regulations? Further, are foreign nationals allowed to become members of the Board of Directors to the extent of the foreign participation in the equity enterprise?

Answer The following ownership limits will be applied on qualified foreign investors (“QFI”) and ultimate beneficiary in a swap agreement (“Swap Investor”): • Each QFI may not own 10% or more of the shares of any issuer whose shares are listed or convertible debt instrument of the issuer.

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• The maximum proportion of the share of any issuer whose shares are listed or convertible debt instrument of the issuer that may be owned by all foreign investors (in all categories, whether residents or non-residents) in aggregate is 49%.

The above restrictions only apply to QFIs and Swap investors. If foreign investors would like to invest in the Saudi market without limitation, they can do so as a strategic foreign investor. However, foreign strategic investors would be restricted from disposing of any of the shares they own in accordance with The Instructions for the Foreign Strategic Investors Ownership in Listed Companies within a period of two years after the date of ownership of such shares. The other provisions of The Instructions for the Foreign Strategic Investors Ownership in Listed Companies shall apply on foreign legal persons who directly owned shares in companies listed on the Main Market. Lastly, foreign nationals are allowed to become members of the Board of Directors to the extent of the foreign participation in the equity enterprise.

Question 28

What are the policies or mechanisms that the Saudi Capital Markets employed in order to sustain their domestic markets given that they have several restrictions and regulations limiting foreign investors to engage in their markets?

Answer CMA initiated a strategic plan to develop the market infrastructure and policies to sustain the domestic markets. To achieve this objective, CMA reviews capital market needs on a frequent basis through its strategic plan that is based on future target of the Saudi market, which is to be a leading in the MENA region, and one of the leading market in the world. The enhancements often take into consideration transforming the market to be in line with the best global practices.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 29

V. FREE TRADE AGREEMENTS Para 5.6 (Page 25) The Kingdom grants preferential treatment to the goods of national origin imported from Singapore as of 1 April 2015 within the framework of the free trade agreement between the GCC states and Singapore. The GCC-Singapore FTA has its own rules of origin.

Please share Saudi Arabia's or the Gulf Cooperation Council (GCC) States' plans to expand trade cooperation agreements with other ASEAN Member States or ASEAN as a whole? What are the plans in terms of agreements in other trade modalities such as trade in services or investment? Are there specific sectors in ASEAN/the Philippines which the KSA consider as potential investment channels?

Answer Negotiating FTA with ASEAN member states is under consideration along with a number of other potential FTAs.

Question 30

VI. FUTURE DIRECTION OF SAUDI ARABIA'S TRADE POLICY Para 6.1 (Page 25) During the Kingdom's presidency of the G20-2020, the Trade and Investment Working Group (TIWG) held a number of Ministerial-level as well as Working Group-level meetings, which included virtual extraordinary meetings in response to COVID-19 pandemic. The first meeting of the working group took place in March 2020 in Al-Khobar, with the participation of G20 members, invited countries and a number of international organizations. During the meeting, the priorities of the TIWG were revealed and discussed in addition to the launch of the Riyadh initiative for the future of the World Trade Organization.

How did KSA, during its G20-2020 presidency, lead the group to discuss responses to the COVID-19 pandemic specifically on trade-related issues (e.g., export ban or restrictions on medical supplies)?

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Answer The Kingdom of Saudi Arabia proposed short and long term action lists to counter the negative effects of Covid-19 and to support the multilateral trading system, in this regards G20 members supported and endorsed these lists.

III. OTHER QUESTIONS

Question 31

The IMF expects the current account deficit in KSA, as a percentage of GDP, to settle at 2.5% and 1.6% in 2020 and 2021, respectively, mainly as a result of the COVID-19 pandemic. May we ask if these are in line with the KSA's external sector projections? How does the KSA expect the recent developments on vaccine availability along with the emergence of the new variants of COVID-19 influence its external sector outlook for 2021-2022?

Answer KSA's external sector projections for 2020 using actual number for quarter 1, 2, 3 and projecting quarter 4 is equal to -1.6%, where the projection for 2021 is equal to 4.5% surplus. MOF has assumed developments on vaccine availability when projecting 2021-2022 for current account.

Question 32

Saudi Arabian Monetary Authority (SAMA) had its maiden issuance of SAMA bills in December 2008. What are the objectives in introducing SAMA bills? Since its maiden issuance, have these objectives been achieved? Given that the weekly offering for SAMA bills is revised infrequently, what indicators does SAMA consider in deciding to change the volume of the weekly SAMA bill offering? Moreover, how does SAMA allocate the volume across the offered tenors?

Answer SAMA bills are liquidity management tool issued on a weekly basis for maturities up to 1-year. SAMA bills have been introduced as a liquidity management tool and subsequently provide a short term high quality securities for the banking system. SAMA bills currently have a weekly offering of SAR 10 bn, the offering dependent on monetary conditions. More recently, the offering has been adjusted from SAR 3 bn to SAR 10 bn in December to enhance banks' efficiency in managing liquidity. SAMA bills allocation is based on a pro rata basis.

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RUSSIAN FEDERATION

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1

4 SECTORAL DEVELOPMENTS 4.6 Services 4.6.1 Financial services

Page 19, para 4.45 Simultaneously in 2018, SAMA launched Fintech Saudi, an initiative to develop the Kingdom as a hub for financial technology and contributing to the support of financial inclusion and the rise of digital transactions.

An inclusive financial system implies that the majority of people have access to and use financial services. The lack of access to such financial services can contribute to the persistence of income inequality and hinder economic growth. Financial inclusion is an integral part of the economic and social development and is currently a priority in many countries. Could Saudi Arabia please clarify at what stage of development is financial inclusion in Saudi Arabia and what government measures have been taken on order to improve it?

Answer At the end-2020, the cumulative effects of FSDP initiatives positively affected the Kingdom’s level of financial inclusion and will continue to improve further in the short- and long-term as per the following indicators:

• The share of population above 15 years old that have an account is above 80% mark by the end of 2020 compared to 71% in 2018. This is largely facilitated by the growing use of e-wallets and the high degree of mobile penetration. In addition; focused efforts is accorded to segments in remote locations or with less digital connectivity e.g. (i) expanding the use of qualified agent banking, (ii) ensuring banks’ fee and charges facilitate more account opening and active usage, and (iii) expanding insurance penetration via bancassurance and mandatory insurance coverage. As such, the Kingdom remains on track to achieve its 90% target number of population with access to formal financial institutions. • Share of non-cash transactions (% of total transactions) rose two-fold to 36% (2020 target: 28%). • Point-of-sale transactions increased by 158% to reach SAR37 billion. • SME loans as a share of bank loans increased four times to 8%, 3ppts above the target. • 14 Saudi-based fintech firms operating with full license, from the initial target of 3.

Question 2

2 TRADE AND INVESTMENT REGIMES 2.1 General Framework Pages 23-26

Could Saudi Arabia please provide information on the types of legal instruments of general application that can be adopted by the Saudi authorities and are applied within the territory of Saudi Arabia (specifying which authority is responsible for adoption of the relevant legal instrument)?

Answer The regulatory authority shall have the jurisdiction of formulating laws and rules conducive to the realization of the well-being or warding off harm to State affairs in accordance with the principles of the Islamic Shari‘ah Law. It exercises its jurisdiction in accordance with the Basic Law of Governance, and Laws of the Council of Ministers and the Shura Council.

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Question 3

2 TRADE AND INVESTMENT REGIMES 2.1 General Framework

Pages 23-24, para 2.5 The Basic Law of Governance, 1993, serves as the constitutional framework, and stipulates that the Shariah is the bedrock of the Kingdom.7 Over the years, the Shariah has been supplemented by an evolving body of laws and regulations issued through royal decrees and other legal instruments. Trade policy and other related policies (such as intellectual property, and corporate law) are implemented by means of such legal instruments.

Could Saudi Arabia please confirm that royal decrees and other legal instruments referred to in para 2.5 are included in the notion of "laws and regulations"?

Answer Laws and regulations are issued through legal instruments. The Royal Decree is a legal instrument to approve Laws and Regulations in Saudi Arabia pursuant to "Basic Law of Governance" Article (70).

Question 4

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.4 Competition policy and price controls Pages 62-67

Could Saudi Arabia please elaborate on the sectors, activities or types of enterprises excluded from the competition regime's coverage after the issuance of the new Competition Law (23.09.2019)?

Answer The exception is conditional to whether the entity is solely owned by the Saudi Government and solely authorized to provide a commodity or service.

Question 5

Could Saudi Arabia please confirm that the new Competition Law (23.09.2019) has a provision on possibility of its extraterritorial application?

Answer According to clause B in Article 3 of Saudi competition law it states that: “Practices taking place outside the Kingdom which have an adverse effect on fair competition within the Kingdom, in accordance with the provisions of this Law.”

Question 6

Could Saudi Arabia please elaborate on methods of price (tariff) regulation of goods and services that are applied by the state?

Answer The methods of price (tariff) regulation of goods and services that are applied by the government is illustrated in full in KSA accession working party report.

Question 7

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.1 Overview

Page 72, para 3.183 Under Vision 2030, Saudi Arabia is building innovation labs and platforms, and engaging in initiatives to encourage entrepreneurship. This approach was underpinned by the reforms undertaken in the

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IP administrative regime during the review period. For example, in 2020, the SAIP requested public consultations on a draft regulation for IP licensing, and launched a network of 33 IP support centres, and, in 2019, it began preparations for the development of a national IP strategy.

The Report indicates that in 2019 Saudi Authority for Intellectual Property (SAIP) has launched work on developing a national IP strategy. Could Saudi Arabia please provide information on the development of the strategy? What is the planned date of the strategy adoption?

Answer National IP Strategy is being prepared along with the contribution of National stakeholders.

Question 8

Page 75, para 3.198 GIs may be protected as trademarks. According to the authorities, the period of time from the filing of an application to the date of rejection or approval is similar to that of trademarks. As part of the Project for the Protection of GIs, and in cooperation with related national authorities, the SAIP compiled a list of agricultural and food products, handicrafts, and national industrial products that may be registered as GIs. The SAIP requested all interested parties to submit written opinions or notes in accordance with a July 2020 deadline.

Please provide more detailed information on the Project for the Protection of GIs. In particular, which government authorities are involved in its development and implementation? What are the goals of the Project? Has it been implemented yet? If yes, what results have been achieved?

Question 9

The Report states that GIs may be protected as trademarks. Could Saudi Arabia please clarify whether there is a sui generis regime for legal protection of GIs and/or appellations of origin? If there is none, are there any plans to develop national legislation in this area?

Answer to 8 & 9 Geographical Indications in Saudi Arabia can be registered as collective marks. In addition, Saudi Arabia has been working on developing a sui generis law for the Protection of Geographical Indications. The Saudi Authority for Intellectual Property is the government body taking the lead in the draft law and will be responsible for its implementation. The development process involved all the related government entities and public consultation to ensure effective cooperation. The draft law aims at providing protection for the registered geographical indications, and it also aims to prevent illegitimate exploitation of local products for which the regions of the Kingdom are famous for, or its imitation in a way that leads to misleading consumers about the true source of these products.

Question 10

4 TRADE POLICIES BY SECTOR 4.1 Agriculture, Forestry, and Fisheries 4.1.3 Policies 4.1.3.2 Domestic policies

Page 84, para 4.19 The ADF provides interest-free loans17, including repayment subsidies18: (i) to small farmers and medium-sized enterprises growing specialty products; (ii) to importers of products related to food security through the Agricultural Products Import Finance Program19; and (iii) for Saudi investments in priority crops abroad under the Agricultural Investment Abroad (AIA) Program. Loans cover investment costs to varying degrees, depending on the size of the investment and with projects using modern technologies or those implemented by joint-stock companies being eligible for a higher

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- 113 - financing share.20 As a result of the COVID-19 pandemic, additional funds were allocated to food-security-related import programmes, to support SMEs with working capital loans, and to reschedule existing loans to SMEs to alleviate liquidity issues. The number and value of ADF loans have declined since 2015, while overall subsidies increased and approved loans in 2019 increased sharply.

According to the previous TPR, Agricultural Investment Abroad Program was "under study and evaluation" (WT/TPR/M/333/Add.1, p.70). The Secretariat's report (WT/TPR/S/407) notes that now "The ADF provides interest-free loans, including repayment subsidies … for Saudi investments in priority crops abroad under the Agricultural Investment Abroad (AIA) Program." Could Saudi Arabia please provide relevant information described in the Statistical Appendix to the Annex to the Bali Decision on PSH?

Answer Out of the TPR scope.

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SINGAPORE

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 Page 25 (Para 2.12) Since the launch of Vision 2030 in 2016, Saudi Arabia has made commendable progress in diversifying government revenues. The WTO Secretariat Report notes that the Saudi authorities have indicated that Vision 2030 is currently being reviewed. Could Saudi Arabia elaborate on: A. the status and timeline for the review; and b. how the strategies for Vision 2030 and Saudi Arabia's economic diversification plans might change in light of the COVID-19 pandemic?

Answer a. The Vision 2030 includes several Vision Realization Programs (VRP) which go through a regular refreshment/update cycle periodically. Most VRPs have recently completed their refreshment/update cycle. b. Some changes in terms of the approach occurred in some strategies, however, the Vision 2030 targets and objectives remain the same

Question 2 Page 28 (Para 2.28) The WTO Secretariat Report notes that Saudi Arabia is a strong supporter of the multilateral trading system and held two extraordinary G20 Trade and Investment Ministerial Meetings were held to address the challenges posed by the COVID 19 pandemic. We thank Saudi Arabia for your leadership in this area. Could Saudi Arabia elaborate on its plans and initiatives to ensure supply chain connectivity and resilience for the Gulf region?

Answer The kingdom of Saudi Arabia encourages MSMEs, Multinational Corporations (MNCs) and their affiliates to develop fair, balanced linkages to support increased participation of MSMEs in regional supply chains, and to explore ways of making those supply chains more resilient and reliable for MSMEs, including through the strengthening of relevant business support organizations that host information portals on competitiveness of local MSMEs and offer matchmaking services, with MNCs. The Small and Medium Enterprises launched the 'Vendor Development Program' (Jadeer) to support local MSMEs meet large enterprises standards and procedures and enable them to connect to MNCs procurement.

Question 3 Page 31 (Para 2.41) The WTO Secretariat Report notes that the GCC-Singapore FTA entered into force on 1 September 2013, and was notified to the WTO in June 2015. Could Saudi Arabia elaborate on: a. the outreach efforts undertaken to promote the benefits of the GCC-Singapore FTA to Saudi industry players; and b. efforts to promote awareness of obligations under the FTA to relevant Saudi authorities and ensure compliance by stakeholders?

Answer The General Authority of Foreign Trade held and continues to hold periodical awareness campaigns to acquaint industries, services providers, exporters and importers with existing FTAs as well as the benefits and opportunities available under them. GAFT is also responsible ensuring compliance with FTAs to which the Kingdom is a Party thereto.

Question 4 Page 31 (Para 2.43) 4. The WTO Secretariat Report notes that the GCC is reviewing its position regarding all its FTA negotiations. Could Saudi Arabia elaborate on the scope of this review, and whether there are plans to pursue more FTAs?

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Question 5 Page 39 (Para 3.3) Saudi Arabia has introduced an electronic trade single window that allows electronic submission and processing of import declarations which has helped facilitate trade. Could Saudi Arabia share whether there are plans to further digitalise and streamline trade documentation, as well as link up the single window with similar systems in other countries?

Answer The Kingdom of Saudi Arabia fully applies the trade facilitation agreement. One of the steps in this process is the launch of "FASAH" platform, which allows importers to enter imported goods data before arrival in order to speed up the process of consignment clearance. General Customs Authority is developing and adding reforms to this platform in line with trade facilitation agreements.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 6 Page 10 (Para 3.19) 6. The Government Report states that KSA's Economic Cities and Special Zones Authority (ECZA) is planning to establish more than 7 SEZs in the coming 5 years. Could Saudi Arabia elaborate on its plans for these upcoming SEZs?

Answer 6-We expect the launch of the first three SEZs in 2021, and three more in 2022

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SWITZERLAND

I QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 According to paragraph 3.35, Saudi Arabia levies an excise tax on beverages. The different rates are 50% for soft drinks and sweetened drinks and 100% for energy drinks. Since the implementation of this tax, Switzerland has voiced its concerns bilaterally as well as in the WTO about the consistency of this tax with Article III of the GATT. The General Authority of Zakat and Tax (GAZT) informed Switzerland in August 2020 that a study, aiming at making recommendations to reform the tax, was ongoing and should be completed soon. Which recommendations does the study contain?

Answer The purpose of the study is to provide the Kingdom and the Gulf Cooperation Council member states ("GCC") with alternative excise tax implementation models especially with respect to sweetened beverages. The content of the study should enable the GCC states to make a determination as to the optimal excise model that takes into account international best practice, ease of implementation, compatibility with the tax's health objectives, compliance with international obligations, sustainability, impact and burden on manufacturers and consumers, and equity.

Question 2 Does the revised tax link the rates to the level of sugar contained in the beverages?

Answer The details of the excise tax model will be announced once there is an agreement among the GCC states and a formal resolution is passed. The tiered volumetric excise model is a model under consideration by the GCC states

Question 3 What will be the revised structure of the tax?

Answer The details of the excise tax model will be announced once there is an agreement amongst the GCC states and a formal resolution is passed.

Question 4 What are the rates of the revised selective tax and to which products do they apply?

Answer

The current excise tax rates applicable in the Kingdom are as follow: • Soft drinks (50%); • Sweetened drinks (50%); • Tobacco-related products (100%); • Energy drinks (100%); • Electronic devices and equipment used for smoking, vaping, and similar activities (100%); and; • Liquids consumed in electronic devices and equipment used for smoking, vaping, and similar activities (100%). The details of amendments to the excise tax rates -if any- will be announced once there is an agreement among the GCC states and a formal resolution is passed.

Question 5 Does Saudi Arabia foresee to exempt beverages with no added sugar or low-caloric beverages from the selective tax?

Answer Currently, excise tax is not assessed on beverages that do not contain added sugar. Exempting or applying a different excise tax rate to beverages with based on caloric content is among the options being considered at the GCC level.

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Question 6 When will the revised selective tax come into force?

Answer After the GCC member states reach an agreement as to the new excise model and a formal resolution is passed to amend the GCC Unified Excise Treaty, the Kingdom will take the necessary steps to ratify the amendment and make a formal announcement as to the expected timeline to begin enforcing the new excise model domestically. It is expected that -at a minimum- the member countries that have already implemented the tax domestically will announce their respective timeline for domestic implementation within a few months of the resolution to amend the treaty passed.

Question 7 When does Saudi Arabia foresee to inform private industry, trading partner governments and other interested parties about the study?

Answer The details of amendments to the excise tax rates -if any- will be announced once there is an agreement among the GCC states and a formal resolution is passed. the Kingdom will publish the draft amended legislation for public consultation prior to enacting the new legislation and will give all stakeholders sufficient time to provide their feedback.

Question 8 Until the reform is implemented how does Saudi Arabia intend to address the discrimination between energy drinks and other sugar containing beverages, i.e. harmonize and apply the same tax rate to all sugar containing beverages?

Answer The Government of Saudi Arabia applies the same tax rate on all excisable goods and ensures equal tax treatment is applied, whether those excisable goods are produced domestically or imported. Saudi Arabia emphasize that the excise regime is not and has never been discriminatory in any way. The difference in the tax rate between energy drinks and sweetened drinks is based on the inherent difference between the types and contents of the beverages. Thus, the appropriate tax rate applies to a drink depending on how its categorized based on the legal definition for each type of beverage.

Question 9 Does the study recommend to subject other beverages to the selective tax? If yes, which beverages would be newly taxed?

Answer Any expansion of the goods subject to excise tax will be announced formally upon the issuance of a resolution at the GCC level to that effect. Products subject to excise are those that are considered harmful to human health. Thus, any expansion of the tax's scope would be to include consumable products that are similarly deemed to be harmful to human health.

II QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 10 3.2 Technical Barriers to Trade (TBT) - (page 11 – paragraphs 3.20 to 3.23) Switzerland would like to raise its concerns over the potential impact of the Saber Conformity Assessment Online Platform on bilateral trade with the Kingdom of Saudi Arabia in a range of products, including textiles and machineries. While Switzerland shares the Kingdom of Saudi Arabia's objective to ensure the safety of products placed on the Kingdom's market, Switzerland is concerned over the system's costly, burdensome and time-consuming nature in particular in view of the COVID-19 pandemic. Furthermore, manufacturers continue to report that recognised bodies require disproportionate fees when carrying out conformity assessment procedures. Moreover, additional certificates of conformity need to be issued by the recognised bodies for identical products already placed on the market, leading to the same costs. Finally, depending on sector, complex conformity assessment procedures are required for products considered in their majority to be low risk products. Will the Kingdom of Saudi Arabia publish in a transparent manner all relevant regulations instituting the Saber Conformity Assessment Online Platform and release the necessary guidelines so as to ensure an effective implementation of the Saber Conformity Assessment Online Platform?

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Answer The technical regulations can be found in the official website of SASO, which provide the scope for each technical regulation and the conformity assessment procedure. Please visit the link below for further details: http://www.saso.gov.sa/en/laws-and regulations/technical_regulations/pages/default.aspx

Question 11 Will the Kingdom of Saudi Arabia reconsider its approach and ensure that the registration and certification process is efficient and less costly for producers? The documentation and certification requirements, as well as registration and certification fees, should be kept to what is necessary to guarantee an effective implementation of the applicable requirements.

Answer Registration for products is free of charge in Saber Platform. In regards to the regulated products, which required PCOC, prices are dependent on the conformity bodies based on the technical files provided for the CB. Therefore, prices depend on the CB itself; however, SASO-Fee recommendation for CB for reviewing the complete technical file is 1500 SAR. In addition, the PCoC is required for one type of product which means if you have some products that are at the same type (Same HS Code, same model type, made in one factory, in the same country of origin, and belong to the same trade mark) then you only need to apply for one PCoC. For the shipment certificate fee, it costs 350SAR for each shipment (can contain many products) arriving to the Kingdom of Saudi Arabia.

Question 12 In the assessment of its approach, would the Kingdom of Saudi Arabia consider the risks of products when elaborating the applicable conformity assessment procedures?

Answer SASO evaluates the risks of products based on the reports received from the overlapping government authorities with it, such as the Ministry of Health, Civil Defense and the Ministry of Commerce, in addition to being guided by the results of the conformity index issued by SASO, as well as the reports issued by the Monitoring and Alert Center of unsafe products. Accordingly, the Conformity Steering Committee approves the conformity assessment procedures.

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CHINESE TAIPEI

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 Page 27 (Para 2.22) Trade policy objectives are guided by Vision 2030. Accordingly, the GAFT aims to maximize the Kingdom's contribution to international trade in order to strengthen the national economy. It seeks to achieve this by enabling market access to international markets for Saudi exports of non-oil goods and services, and by providing protection for national goods and services from unfair trade practices abroad. The GAFT also aims to support greater private sector participation in foreign trade. At present, the GAFT is developing the National Foreign Trade Strategy, for which it receives inputs from relevant government entities and the private sector. In the interest of strengthening its national economy, Saudi Arabia is increasing market access to international markets for Saudi exports of non-oil goods and services, while the GAFT is developing the National Foreign Trade Strategy. Could the GAFT please share with us further details of the specific approaches it is taking in its development of the National Foreign Trade Strategy?

Answer Foreign Trade Strategy is being developed via incorporating and aligning with all relevant government agencies strategies. GAFT also reflects inputs and interests of the private sector. Saudi Arabia, jointly along with other GCC member states, plan to increase their share in international trade through expanding their network of preferential trade agreements. Prioritizing FTA's negotiations is based on several elements including; potential trade coverage (goods and services) and destinations that could warrant economic integration

Question 2 Page 44 (Para 3.31) In April 2020, the Government raised import tariffs on certain goods, including dairy products, juices, vegetables and olive oils, chemicals, building materials, and vehicles. The changes took effect in June 2020. The Report by the Secretariat (Page 8, Para 10) states that import tariffs, which are subject to common GCC rules, did not change significantly until the recent COVID- 19 pandemic. … In June 2020, customs duties were raised on various categories of consumer, industrial, and agricultural products as part of the Government's response to the COVID-19 pandemic. The Government of the Kingdom of Saudi Arabia announced an increase in customs duty rates on a total of 1,370 items (including foodstuffs, mineral and chemical products, plastic, rubber, leather goods, textiles and footwear, base metals, cement, ceramics, machinery, equipment and electrical equipment, toys, furniture, vehicles and various other manufactured goods) applicable from June 20th. The full list of products was published on the Saudi Customs website only on June 18th, therefore, in addition to the sudden impact of unexpectedly high increases in duty rates, exporters were also given insufficient time to react. Should the Saudi Government have been more prudent and lenient in its imposition of this measure?

Question 3 Raising tariffs inevitably increases importation costs, which has a detrimental effect on the welfare of Saudi residents. Will the Government of the Kingdom of Saudi Arabia consider restoring the tariffs back to their previous rates once the COVID-19 pandemic is over?

Answer to Questions 2 and 3 On 20 June 2020, the Kingdom of Saudi Arabia increased customs duties on 575 goods only. Raising the tariffs to the bound rates is a legitimate Member's right and it is not limited to a time frame.

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TURKEY

I. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 1

3. Trade Policy Developments, 3.1. Tariffs, Other Measures Affecting Imports, 3.1.2. Import and export formalities, pg. 9, 3.2. It is stated in the Government Report that "Since 2016 up to now, Saudi customs facilitated and automated customs procedures to achieve customs vision of being ranked the first in the region for providing distinguished custom services. In order to become a global logistic hub, the Kingdom fully applies the agreement on Trade Facilitation and has automated various customs formalities." Could the Kingdom of Saudi Arabia give further information about its customs procedures implemented to imported goods? Are there any complaints from Saudi importers regarding not being able to complete customs transactions due to long-duration delays in the customs? Is there any discriminative application at Saudi customs based on the origin of goods, if not, could the Kingdom of Saudi Arabia explain the recent problems faced regarding the importation of Turkish goods at the customs?

Answer The General Customs Authority applies, the provisions of Article (56) of the Common Customs Law for GCC Countries, its Rules of Implementation and Explanatory Notes thereof issued by a Royal Decree No. (M/41), dated 03/11/1423H. It provides for in paragraph (a) thereof; “The customs authority may have the goods scanned by specialized agencies to verify the kind and specifications of the goods or their conformity to the Laws and regulations;” while provides for in paragraph (b): “Goods requiring the availability of certain conditions and specifications to be released shall be subject to inspection” Thus, these conditions shall be applied to all consignments entering KSA. Also, the Kingdom of Saudi Arabia accords MFN treatment to imports from all its trading partners.

Question 2

Despite the above stated facilitated customs procedures Turkish exporters increasingly raise complaints about the unusual long-lasting procedures (approximately 1 month) at the customs of the Kingdom of Saudi Arabia since 2020. Could the Kingdom of Saudi Arabia elaborate on the underlying reasons of such long-lasting customs procedures, which appears to affect particularly Turkish goods? What could the relevant Saudi Arabian authorities advise Turkish exporters on the methods to avoid these long waits?

Answer Kindly refer to answer provided for question 1.

Question 3 3. Trade Policy Developments, 3.1. Tariffs, Other Measures Affecting Imports, 3.1.6. Exports and free zones, pg. 11, 3.18. It is stated in the Government Report that "SEZs being developed in Saudi Arabia have competitive locations targeting (17 sectors) which can be collectively described as; Industrial, Logistics, Aviation, Military, Maritime, Food processing, Pharma & Bio-pharma, Machinery & equipment, Automotive, Renewables, Specialty Chemicals, Healthcare, Media, Financial services, Tourism, Digital and E- commerce." Could the Kingdom of Saudi Arabia provide detailed information about SEZs? What are the expected outcomes from SEZs in terms of e-commerce?

Answer The Economic cities and Special Zones authority is mandated to realize the development plans of the Kingdom through attracting national capital and foreign investments in the Special Economic Zones (“SEZs”). The SEZs envisaged having best in class regulations and standards for various commercial, industrial and service related activities including e_commerce.

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Question 4 3. Trade Policy Developments, 3.2. Technical Barriers to Trade (TBT), pg. 11, 3.20. It is stated in the Government Report that "In order to protect commercial facilities from fraud and tampering with technical documents, in addition, ensure products are free from defects that may affect the health, safety, and the environment of the consumer; Saudi Standards, Metrology and Quality Organization (SASO) introduced "SABER" platform. SABER automated tracking of products, technical processes involved in the supply chain and raising products' safety levels." Could the Kingdom of Saudi Arabia provide detailed information about the purposes and scope of SABER platform? Does the Kingdom of Saudi Arabia plan to amend the scope of SABER?

Answer Saber is an electronic platform that is developed under the supervision of SASO, and according to the highest standards of efficiency in terms of speed of completion in registration, as well as in reducing the time spent for beneficiaries.

Saber's Electronic Platform Features: ▪ Improving import experience and obtaining the certificates of conformity and shipment. ▪ Ensuring safety of the products available in the market. ▪ expedite borders clearance. ▪ One platform integrated with other authorities. ▪ Lower total cost. ▪ Ensuring that products are free from defects and they are safe for Saudi consumer, limiting the fraudulent products, reducing the required time to import products in coordination with the Saudi Customs examination, and speeding up the process of issuing the required Conformity Certificates. Saber certifications are required from both importers and local manufactories.

Question 5 4. Sectoral Developments, 4.2. Food Security, pg. 15, 4.15. It is stated in the Government Report that “Food security strategy in the Kingdom seeks to achieve five main objectives, which include; achieving sustainable domestic food production system, diversifying and stabilizing external food supply sources, ensuring access to safe and nutritious food and promote healthy and balanced nutrition habits, building food security resilience capabilities and institutionalizing food security at the national level and ensuring clear and accountable governance.” Could the Kingdom of Saudi Arabia provide detailed information about the strategies and methods that have been implemented for stabilizing external food supply sources?

Answer Saudi Arabia has begun refining the strategies in recent years to combine more targeted overseas investments via Agriculture Investment Abroad (AIA) program and Importation program. AIA was set-up with the aim to achieve a stable and affordable supply of risky commodities through strategic and viable AIA, encourage private sector involvement in agriculture investments abroad and establish mutually beneficial partnerships with host countries. AIA targets were set for commodity which have low self-sufficiency ratios as a portion of total demand in alignment with Food Security and National Agriculture Strategies. These commodities are divided into primary crops such as alfalfa, wheat and maize and secondary crops such as sugar, rice, edible oil, barley, red meat and soya bean. Apart from AIA program, the crop importations initiative is another strategy and method for stabilizing external food supply sources. The initiative is focused on providing loans to private sector in order to assist in meeting the food security demand on the essential crops such as rice, sugar, soybean and corn. Diversifying the sources of imported grains procurement is one of the methods used to enhance supply chain in the kingdom.

II. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 6

2. Trade and Investment Regimes, 2.2. Trade Policy Formulation and Objectives, pg. 27, 2.22. It is stated in the Secretariat Report that “Trade policy objectives are guided by Vision 2030. Accordingly, the GAFT aims to maximize the Kingdom's contribution to international trade in order to strengthen the national economy. It seeks to achieve this by enabling market access to international markets for Saudi exports of non-oil goods and services, and by providing protection

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- 122 - for national goods and services from unfair trade practices abroad. The GAFT also aims to support greater private sector participation in foreign trade. At present, the GAFT is developing the National Foreign Trade Strategy, for which it receives inputs from relevant government entities and the private sector.” Could the Kingdom of Saudi Arabia provide further information of its National Foreign Trade Strategy?

Answer GAFT is developing the National Foreign Trade Strategy, where the strategy and its initiatives are being formulated on the basis of international and regional best practices and in consultation with private sector, aiming to achieve Vision 2030 goals and objectives.

Question 7 3. Trade Policies and Practices by Measure, 3.1. Measures Directly Affecting Imports, pg. 39, 3.5. It is stated in the Secretariat Report that “Regarding transparency, the SCA implemented some changes during the review period, such as: (i) launching an import and export guide to allow more transparency on the import or export process, in cooperation with other government authorities, through the single window platform; (ii) publishing the customs tariff HS codes on its website and mobile application; (iii) launching a public platform for receiving reports from traders, brokers, employees, and public "clients" on corruption and violation of laws; and (iv) establishing a Customs Committee (an independent customs court) to rule on duty-collection decisions and the variances in customs duties found by the PCA team, which enables the trader to submit a defence and initiate legal proceedings.’’ In the framework of transparency, could the Kingdom of Saudi Arabia provide detailed information about its assessment process regarding complaints from foreign exporters on the intended delays and discriminative practices at customs?

Answer The General Customs Authority does not engage in any intentional and discriminatory practices, rather, it applies the provisions of the Common Customs Law and its Rules of Implementation thereof as the legislative framework for the works and competencies of the Authority. The Authority asserts that it equally applies its procedures to all the Kingdom’s imported and exported goods.

Question 8 3. Trade Policies and Practices by Measure, 3.3. Measures Affecting Production and Trade, 3.3.2. Standards and technical requirements, pg. 57, 3.101. It is stated in the Secretariat Report that “The SASO adopted ISO/IEC 17065 as a model for assessing the conformity of products and services. The SASO made Saber, an electronic platform, available to all economic operators importing products to Saudi Arabia. In addition, users can write to an email address with questions regarding Saber. The Saber platform will be connected to the customs platform in order to facilitate the recording of customs operations.” Could the Kingdom of Saudi Arabia provide detailed information about how the Saber platform will be connected to the customs platform in order to facilitate the recording of customs operations? How will this connection affect the customs procedures and solve the problems regarding the long-lasting customs procedures of the Kingdom of Saudi Arabia?

Answer Saber is linked electronically to FASAH platform (Custom platform). Therefore, all data will be linked and verified from Saber platform, which will save time.

Question 9 3. Trade Policies and Practices by Measure, 3.3. Measures Affecting Production and Trade, 3.3.2. Standards and Technical Requirements, pg. 8, 57-58, 3.106. It is stated in the Secretariat Report that “The SASO, in coordination with the SCA, adopted and validated a procedure for the random verification of the conformity of documents and products based on TBT/WTO directives and risk assessment. Regarding random product controls at Saudi Customs, and if there is an obligation to carry out product tests, the SASO in coordination with the SCA adopted a simplified procedure to facilitate product transits.” Recently, almost all products imported from Turkey have been subject to the above mentioned "random control" at Saudi Customs. Could the Kingdom of Saudi Arabia provide reasons and details

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Answer The General Customs Authority applies, the provisions of Article (56) of the Common Customs Law for GCC Countries, its Rules of Implementation and Explanatory Notes thereof issued by a Royal Decree No. (M/41), dated 03/11/1423H. It provides for in paragraph (a) thereof; “The customs authority may have the goods scanned by specialized agencies to verify the kind and specifications of the goods or their conformity to the Laws and regulations;” while provides for in paragraph (b): "Goods requiring the availability of certain conditions and specifications to be released shall be subject to inspection" Thus, these conditions shall be applied to all consignments entering KSA.

Question 10 3. Trade Policies and Practices by Measure, 3.3. Measures Affecting Production and Trade, 3.3.2. Standards and technical requirements, pg. 59, 3.116. It is stated in the Secretariat Report that "Labels must be in Arabic in addition to any other language. A small number of products with English-only labels may be approved, on a case-by-case basis, for marketing test purposes. As an Islamic country, Saudi Arabia has strict marking and labelling requirements for meat and poultry products, including that the product was slaughtered in accordance with Islamic halal procedures. The most important specifications related to the labelling of food are: SFDA.FD/GSO 9, "Labelling of Pre-packaged Foods"; SFDA.FD 2333, "Food Requirements with Health and Nutrition Claims"; and SFDA.FD 2233, "Nutritional Data Requirements on the Card". Labelling information on pharmaceutical, cosmetic, and personal care products are required to appear on the outer pack for each product marketed in Saudi Arabia.” Could the Kingdom of Saudi Arabia explain whether it is sufficient in the new halal system for a halal certificate to be issued against the standards which are accepted by the Kingdom of Saudi Arabia such as OIC/SMIIC standards, and is any accreditation required? If yes, accreditation by which bodies and against which standards are accepted for halal certificates?

Answer In order to accept halal certificate for imports of food, recognized halal certification body shall issue Halal certificate. Recognition Requirements: 1- Accreditation certificate based in GSO 2055-2. 2- Acceptance certificate by SASO . 3- Recognized by Halal Center.

Question 11 3. Trade Policies and Practices by Measure, 3.3. Measures Affecting Production and Trade, 3.3.3. Sanitary and phytosanitary measures, pg. 60-61, 3.124. It is stated in the Secretariat Report that “In addition to obtaining a commercial registration (Section 3.1.1), food importers must register with the SFDA and specify the food items that they import. All imports of food and animal products for human consumption are subject to import permits issued by the SFDA. For imports of meat and poultry meat, a Halal Certificate and an Islamic slaughter certificate are required for each consignment, in addition to other documentation generally required for customs clearance. As the Kingdom of Saudi Arabia launched a new halal system for imported products, could the Kingdom of Saudi Arabia explain in detail the acceptance procedure of the Saudi Halal Center (SHC) of the Saudi Food and Drug Authority (SFDA) and describe the new halal system by specifically explaining the role of all relevant institutions participating in this acceptance procedure?

Answer In order to accept halal certificate for imports of food, recognized halal certification body shall issue Halal certificate. Recognition Requirements: 1- Accreditation certificate based in GSO 2055-2. 2- Acceptance certificate by SASO . 3- Recognized by Halal Center.

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Question 12 3. Trade Policies and Practices by Measure, 3.3. Measures Affecting Production and Trade, 3.3.3. Sanitary and phytosanitary measures, pg. 61, 3.125. It is stated in the Secretariat Report that “Imports of meat and poultry meat must be sourced only from the establishments on the list maintained by the SFDA. This list can be consulted by sector or by country. Establishments that wish to supply meat and poultry meat to Saudi Arabia must apply for approval from the SFDA; the approval process involves an evaluation including an on-site audit by the SFDA. If the evaluation outcome is satisfactory, the SFDA grants an approval certificate to the establishment in question. Since 9 March 2014, the SFDA has delegated to the competent authority of the exporting country to approve establishments on the list, provided that the competent authority of the exporting country signs bilateral minutes with the SFDA and assures compliance with the GSO standards.” Could the Kingdom of Saudi Arabia explain whether a halal certificate is needed for domestic meat and poultry meat products of Saudi Arabia? If yes, is accreditation required for those halal certificates regarding these products? What will be the procedure for countries, which could not meet the requirements of the new halal system that is envisaged to be effective as of 1 March 2021?

Answer Identical requirements that are required from foreign establishment are applied on local establishments which include GSO 993 and GSO 2055 for Halal certification. All foreign and national establishment shall comply with halal requirements as of 1 March 2021.

Question 13 Chart 1.3. Direction of merchandise trade, 2015 and 2019, pg. 20 and Table A1. 4. Merchandise imports by origin, 2015-19, pg. 121. According to "Chart 1.3 Direction of merchandise trade, 2015 and 2019" and "Table A1.4 Merchandise imports by origin" in the Secretariat Report, Turkey's share is 2.1% in total imports of the Kingdom of Saudi Arabia in 2019. As can be seen from these statistics, imports from Turkey traditionally constitute an important share in Saudi Arabia’s total imports. According to Turkstat, however, Turkish exports volume to Saudi Arabia has abnormally decreased in the last quarter of 2020. Volume of Turkish exports has declined by about 50% in the last quarter of 2020 compared to the last quarter of 2019 with a decrease of about 80% only in December. Could the Kingdom of Saudi Arabia verify these statistics? Could the Kingdom of Saudi Arabia comment on the possible reasons of such an abnormal decrease, in comparison with its general imports from the rest of the world?

Answer According to the secretariat report table A1.4 merchandise imports from Turkey witnessed an increase in value, although several other trading partners witnessed decrease. More so, the indicated time period in the raised question is not part of the trade policy review time period.

Question 14 4. Trade Policies by Sector, 4.2. Mining and Energy, 4.2.2. Energy, 4.2.2.5. Energy price reform, pg. 100, 4.79. It is stated in the Secretariat Report that “Reform of domestic energy prices was an important component of Saudi Arabia's economic transformation policies during the review period. Saudi Arabia provided energy products to its domestic consumers at prices that are usually lower than export prices. In the context of the Fiscal Balance Program, the total amount of energy benefits resulting from these low energy prices was estimated at close to SAR 300 billion in 2015, given the oil export price at that time, and it was observed that energy and water subsidies together typically accounted for the vast majority of the overall subsidies in Saudi Arabia. In this regard, one of Vision 2030's objectives is to increase the competitiveness of the energy sector by raising the efficiency of the government support system and making the best use of its benefits by redirecting it and targeting eligible citizens and economic sectors. Vision 2030 also provides that, in the long term, free market prices shall stimulate productivity and competitiveness among utility companies and open the door to investment and diversification of the energy mix.” Could the Kingdom of Saudi Arabia clarify how "Energy Price Reform" will affect the trade of energy products?

Answer Price reforms would contribute to trade competitiveness and efficiency that would advance the sustainability of all economic sectors.

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Question 15 4. Trade Policies by Sector, 4.4. Services, 4.4.2. Telecommunications, E-commerce, pg. 117, 4.145. It is stated in the Secretariat Report that "The Ministry of Commerce and Investment (MOC) issued an E-Commerce Law that became effective in October 2019 with implementing regulations adopted and implemented from 31 January 2020. 206 The Law regulates e-commerce between consumers in Saudi Arabia and service providers based anywhere in the world (including transactions between individuals), and contains clauses on consumer data protection, transparency in contracting and electronic advertisements, consumer rights (including returns and cancellations under certain circumstances), and licensing/registration requirements for traders and electronic platforms. According to the authorities, the new framework increased trust in online transactions and facilitated consumers raising cases related to e-commerce to the authorities as a result of a strengthened consumer protection framework." Could the Kingdom of Saudi Arabia further explain the expected outcomes from E-Commerce Law in terms of cross border e-commerce?

Answer With regard to the expected outcomes of the e-commerce law and its executive regulations on the cross border e-commerce, the Ministry of Commerce, represented by the E-Commerce Center, monitoring closely the websites outside the Kingdom and clarifies the law and its materials and policies that it contains, what can be published and presented by the stores to consumers inside the Kingdom In terms of advertisements, discounts, offers and ensuring that they follow the law, as well as, the policies which regulates after-sales services, methods of communication, invoices and the information and details it contains. The law will have control over the practices of external electronic commerce targeted the Saudi market, in order to properly apply them in accordance with the articles of the law and its implementing regulations that are subject to this category.

III. OTHER QUESTIONS

Question 16 During last months, Turkish exporting companies in various sectors have been instructed by the Saudi importers to suspend or to cancel their already agreed shipments or productions to Saudi Arabia on the basis of the information that the importation of Turkish products into Saudi Arabia would no longer be permitted. While the existence of this de facto import ban has been denied by Saudi authorities on different occasions, there is ample evidence and information3 to confirm the existence of an "unofficial pressure" by Saudi authorities on its importing companies to stop importing goods from Turkey. There is information that Saudi companies are being forced to sign "letter of commitment" not to import from Turkey as part of these pressures, shipments from Turkey are systematically being subject to unreasonably long delays at Saudi customs and unnecessarily burdensome product safety inspections. Turkey is deeply concerned about this import prohibitive policy of Saudi Arabia vis-à-vis Turkish products, and would like to address the following questions to Saudi Arabia under its third Trade Policy Review: Have the Kingdom of Saudi Arabia made an official declaration, as referred in the footnote, about the de facto "import ban" against Turkish products?

Answer The referenced information is not an integral part of neither the Secretariate nor the Government reports. Also provided from unreliable sources of data.

Question 17 What is the legal basis of the "import ban" that seems to be applied by the Kingdom of Saudi Arabia against Turkish products?

Answer The Kingdom of Saudi Arabia accords MFN treatment to imports from all its trading partners.

3 https://www.ft.com/content/38de1748-c231-4351-9634-ae0bd8014716 https://www.reuters.com/article/us-saudi-turkey-trade/saudi-business-leader-urges-boycott-of-goods- from-hostile-turkey-idUSKBN26P0RZ https://www.middleeastmonitor.com/20201010-saudi-prince-calls-for-boycotting-turkey-imports/

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Question 18 Are there specific sectors or products targeted under the « import ban» for Turkish products?

Answer Please refer to answer provided to question 17.

Question 19 Have Saudi authorities requested "letter of commitment" from their companies for not to import Turkish products into the country?

Answer Please refer to answer provided to question 17.

Question 20 Can Turkish products still be cleared in the Saudi Arabian customs for importation? If this is the case, what has been the average time for custom clearance for import of Turkish goods into Saudi Arabia from September 2020 to January 2021?

Answer Please refer to answer provided to question 17.

Question 21 How does Saudi Arabia reconcile the de facto "import ban" for Turkish products with GATT Articles I, III:4 and XI?

Answer Please refer to answer provided to question 17.

Question 22 Can Saudi Arabia confirm that it will not impose any import bans on imports from Turkey and that it will comply fully with its obligations under GATT Articles I, III:4, and XI?

Answer Please refer to answer provided to question 17.

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UKRAINE

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 Page 22 (Para 1.28) Under the Report, the Ministry of Investment of Saudi Arabia implemented, inter alia, the following reforms: reduced the foreign investment licence requirements to two documents; launched instant licence and renewal; automated post services (licence renewal, company activities amendment, adding branches); reduced the time to issue new licenses (from an average of 53 hours to less than 4 hours); and extended the validity of the foreign investment licence to five years (rather than being renewed annually). Ukraine would appreciate if the Kingdom of Saudi Arabia could specify features of the foreign investment licenсing system. What requirements should investors meet to get the licenсe to conduct investment activities on the territory of the State?

Answer Ministry of Investment facilitates the entry of foreign value-added enterprises to invest in the Saudi market and provide the opportunity to establish companies to practice various activities by applying for investment licenses after applying the terms and requirements for various investment activities according to the services guide.

Question 2 Page 28 (Para 2.27) The Report notes that Saudi Arabia joined the Joint E-commerce Initiative in 2019. Saudi Arabia actively participates in the negotiating process within the framework of this Initiative in the WTO. Could Saudi Arabia, please, comment on its vision concerning the role of the WTO in promoting regulatory environment in facilitating electronic commerce and the perspectives of the positive outcome of this Initiative in 2021?

Answer The Kingdom's believes on the importance of the JSI on Electronic Commerce and its ongoing negotiations. The Kingdom joined the JSI in 2019 to help promotes a regulatory framework for organizing and facilitating electronic commerce between WTO members in the future. The Kingdom working closely with JSI members to reach an agreement by MC12.

Question 3 Page 33 (Para 2.53) According to the Report, the foreign investment regime is mainly governed by the Foreign Investment Law and its Implementing Regulations. Сould Saudi Arabia kindly describe its legislation on protection and promotion of investments?

Answer The Basic Law of Governance of Saudi Arabia has granted the general protection for foreign as well as domestics (For example: see Article 18 and 19). Investment Principles and Policies in the Kingdom: 1- Ensure equality between Saudi and non-Saudi investors, and among non-Saudi investors. 2- Ensure the protection of investments, in line with the Kingdom's regulations. 3- Enhance the sustainability of investments and deal with investor complaints in a transparent manner. 4-Maintain environmental and social standards in order to ensure that Saudi and non-Saudi investors comply with regulations regarding labor, health, and environmental safety in accordance with national regulations and policies and the international conventions in which Saudi has acceded. 5- Facilitate entry procedures for non-Saudi employees including technicians, administrators, and their dependents. Arrange their residency in the Kingdom to facilitate their participation in activates related to foreign investments in accordance with the Kingdom's regulations and its international obligations. 6- Transfer and localize science and technology resulting from foreign direct investment in accordance with the Kingdom's international obligations.

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Question 4 Page 39 (Para 3.3) The Report notes, that during the review period, Saudi Arabia introduced important changes in customs procedures; notably, the Saudi Customs Authority enhanced an electronic data interchange system, an electronic trade single window that allows electronic submission and processing of import declarations. Could Saudi Arabia clarify whether existing capabilities of the new interchange system allow for electronic exchange of health and other (halal, etc.) certification data?

Question 5 Page 41 (Para 3.15) Under the Report, "There are no legal provisions pertaining to advance rulings. According to the authorities, the SCA answers, on a case-by-case basis, requests for information on customs matters such as classification, valuation, and rules of origin." Could Saudi Arabia, please, clarify whether the Government intends to put in place a system of advance rulings as provided by Article 3 of the Trade Facilitation Agreement?

Answer The purpose of the unified manual is to define the key formalities and controls adopted by the customs administrations of the GCC Countries in order to make advance ruling requested by importers or exporters in preparation for their import/ export operations. Thus, the unified manual is a guidance document that helps importers, traders and employers in GCC Countries and exporters for GCC Countries to understand the formalities and controls relating to advance ruling to facilitate their implementation and use, on the one hand. It also contributes to the strengthening of the Information Unit included in the advance ruling at all the first entry ports and all customs administrations of the GCC Countries. The submission of advance ruling request via the internet will be made available by the importers or their representatives to the competent authorities of the Customs administrations regarding the goods to be imported. The request of advance ruling will be limited to importers who have a commercial record in the Kingdom of Saudi Arabia.

Question 6 Page 48 (Para 3.51) The Report notes, that import prohibitions continue to be maintained based on security, public safety, moral, and religious considerations, as well as on international obligations, such as international convention requirements and UN sanction resolutions. Could Saudi Arabia, please, explain the reasons for prohibiting the import of goods, in particular of following HS codes: 25; 49; 68; 85 and 90 (presented in Table 3.4)? Question 7 Does Saudi Arabia consider any changes regarding these import prohibitions?

Answer With regard to prohibited items under the Harmonized System code (25) and (68), the reasons for prohibition are healthy causes including Asbestos or Amianthus. As for items under the Harmonized System (49) code related to import of Mushafs and Mushafs with a margin for interpretation, the prohibition is for religious and commercial reasons and the King Fahd Compound also prints the Holy Mushafs and meets the need of the local market. As for the customs item under the Harmonized System Code (49) on the prevention of the import of smart watches containing a camera, the prohibition is for security reasons. As for the items under the Harmonized System Code (90), the prohibition of importing portable laser pointers such as laser pens and medals is for healthy and security reasons. The Kingdom of Saudi Arabia periodically updates and revise the import, reorganization and classification of goods.

Question 8 Pages 49-50 (Para 3.62) The Report states, that "The GCC-TSAIP is the investigating authority for trade remedy proceedings. A complaint must be submitted to the GCC-TSAIP, which reviews it and submits an initial report to the Permanent Committee, with a recommendation on whether to pursue an investigation. Based on the initial report by the GCC-TSAIP, the Permanent Committee may decide whether to initiate an investigation and, based on a preliminary determination report by the

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GCC-TSAIP, whether to impose provisional measures. Based on the final findings of the investigation, the Permanent Committee may propose the imposition of definitive measures to the Ministerial Committee." Would Saudi Arabia, please, explain the procedure of decision making in the Permanent Committee?

Question 9 How much influence has each member of the Gulf Cooperation Council (GCC)?

Answer to Questions 8 and 9 The Permanent Committee takes its decision on a simple majority (50%+1) system; each member of the GCC States has one vote with the same weight. The decision is made after discussing the facts and laws provided by reports prepared and provided by the GCC-TSAIP to the Committee in every stage of the investigation. Only in case of equal votes (3-3), the member representing the GCC State of presidency (which is rotated among GCC States every year) will have the power of the casting vote

Question 10 Would Saudi Arabia, please, specify the on-line source with the information on current investigations, measures in force and decisions that were taken?

Answer In order to download and obtain the issued official gazette by the GCC-TSAIP, you need to subscribe in the subscription services through this link by completing the form and pay the monthly or annually fee, https://www.gcc-sg.org/ar-sa/GeneralSecretariat/SectorsSites/TSAD/Pages/Releases.aspx. In addition, in order to follow the news of the GCC-TSAIP you may go to this link: https://www.gcc- sg.org/ar-sa/GeneralSecretariat/SectorsSites/TSAD/Pages/News.aspx.

Question 11 Page 50 (Para 3.63) The Report notes, that "On 3 January 2019, Ministerial Decree No. 211 established the GAFT. The Trade Remedies Deputyship (TRD), under the GAFT, is responsible for all issues related to trade remedies. The Deputy Governor of the TRD is a member of the Permanent Committee and participates in its decisions. The Minister of Industry and Mineral Resources represents Saudi Arabia in the Ministerial Committee for final decision-making of trade remedy matters." Would Saudi Arabia, please, provide more precise information regarding the newly established body TRD under the GAFT?

Question 12 If the GCC-TSAIP is the investigating authority what is the role of TRD under the GAFT?

Answer to Questions 11 and 12 According to the Council of Ministers Decision No. 211 dated 25/4/1440H (1 January 2019) and Article 4.5 of GAFT administrative regulation issued by Council of Ministers Decision No. 741 23/11/1441H (14 July 2020), GAFT is responsible, among other issues of international trade, on trade remedies issues in the Kingdom of Saudi Arabia.TRD as part of GAFT, is assigned to handle all trade remedies issues which currently include; representing Saudi Arabia in the GCC Permanent Committee, coordinating with the Ministry of Industry that represents Saudi Arabia in the GCC Ministerial Committee, representing Saudi Arabia in trade defence investigations targeting Saudi exports, handling trade remedies issue and negotiations in the WTO, and to represent Saudi Arabia in trade remedies among all international forums.

Question 13 Could Saudi Arabia also provide the relevant web-link of the new body?

Answer The website of GAFT including TRD is under development and will be online soon.

Question 14 Page 50 (Para 3.64) The Report mentions, that "During the review period, the GCC-TSAIP conducted several anti-dumping and safeguards proceedings but no countervailing proceedings. Several applications were submitted, and nine were accepted to initiate investigations; one self-initiation investigation was also initiated."

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Would Saudi Arabia, please, explain how domestic legislation regulates self-initiation of the investigation? In particular, when there is no petition from the domestic industry, how would investigating authority establish domestic industry?

Question 15 Would Saudi Arabia, please, explain how the self-initiated investigations comply with the obligation to provide reasons for initiation of the investigation according to Article 12.1 (A) of the WTO Agreement on Safeguards?

Answer According to Article 2.4 of the Regulation of the GCC Common Law on Anti-dumping, Countervailing and Safeguard measures, the GCC Permanent Committee may self-initiate the investigation when the condition of the initiation of the investigation are met as provided under Article 2.3. With regard to the domestic industry, because no petition received and no standing of the petition is required, the investigation authority shall adopt the definition of the GCC industry as provided in Article 3 of the GCC Common Law to conduct the investigation of the serious injury and threat of serious injury during the investigation according to Article 71.2 of the Regulation of the GCC Common Law.

Question 16 According to available information on 23 October 2019 the Competent authority of the GCC initiated a safeguard investigation against the increase of imports of Certain Steel products (G/SG/N/6/SAU/3) and then made a Preliminary finding of serious injury or threat thereof caused by increased imports of Certain Steel Products (G/SG/N/8/SAU/3). On 20 January 2021 GCC notified members that Competent Authority has found some relevant products that have to be added to the scope of the products under investigation; while some other products have been found to be excluded from the scope of the products under investigation (G/SG/N/6/SAU/3/Suppl.1). When is mentioned Safeguard investigation supposed to be concluded?

Answer As provided in paragraph 3 of the notification No. G/SG/N/6/SAU/3 on 24 Oct 2020 satisfying the requirements of Article 12.1 (A) of the Safeguard Agreement, the Permanent Committee has based its decision to initiate the Safeguard investigation on a study made by the GCC-TSAIP. Based on this study and the available information, which showed such increase of imports of the product subject to the investigation, the Permanent Committee has provided that the information, data, evidence, and facts available appear to be sufficient to justify the initiation of the investigation as per the provisions of the Common Law and its Rules of Implementation.

Question 17 What criteria did the Competent Authority apply to conclude that imports of products under investigation were recent, sudden, sharp and significant enough?

Answer According to Article 23 of the Regulation of the Common Law, the investigation shall be conducted within 12 months. However, the GCC Permanent Committee may extend this period to additional 6 months. The mentioned Safeguard investigation has extended 6 months.

Question 18 On what legal basis did the Competent authority decide to add new products within the ongoing investigation?

Answer As the Safeguard Agreement does not include specific criteria to conclude that imports of products under investigation were recent, sudden, sharp and significant enough, the GCC-TSAIP is adopting the criteria as last interpreted by the WTO case law. In the Final decision, the GCC-TSAIP will provide its basis to conclude the determination of "such increase of imports" that justifying any final findings. Because the mentioned Safeguard investigation is self-initiated based on a study made by GCC- TSAIP, and as the investigation includes several categories of the product under the investigation, the GCC-TSAIP amended the scope of the product under the investigation when it finds, during the investigation and verifications, that the scope of the product shall be amended. Accordingly, the investigating authorities made this amendment public to all the interested parties. This amendment was made to fulfill the requirements of Article 1 of the Safeguard Agreement in order to include only the product that "is being imported into its territory in such increased quantities, absolute or relative

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Question 19 Pages 60-61 (Para 3.124) The Report mentions, that in addition to obtaining a commercial registration, food importers must register with the Saudi Food and Drug Authority (SFDA) and specify the food items that they import. All imports of food and animal products for human consumption are subject to import permits issued by the SFDA. For imports of meat and poultry meat, a Halal Certificate and an Islamic slaughter certificate are required for each consignment, in addition to other documentation generally required for customs clearance. Could Saudi Arabia please elaborate whether there are any specific requirements for halal certificates and an Islamic slaughter certificate in order to be recognized by Saudi Arabian Authorities?

Answer In order to accept halal certificate with imports of food, Halal certificate shall be issued by recognized halal certification body. Recognition Requirements: 1- Accreditation certificate based in GSO 2055-2 2- Acceptance certificate by SASO. 3- Recognized by Halal Center.

Question 20 Page 69 (Para 3.162) It is noted in the Report that Saudi Arabia is an observer to the WTO plurilateral Agreement on Government Procurement (GPA) and indicated that it would initiate negotiations for GPA membership. Does Saudi Arabia have an intention to initiate negotiation to be a member of GPA?

Question 21 Could Saudi Arabia please indicate preliminary date when this process might begin?

Question 22 Page 75 (Para 3.201) Under the Report, "There were no significant changes to the legal provisions and administrative procedures concerning compulsory licensing, except the transfer of the competent authority to issue compulsory licences from King Abdulaziz City for Science and Technology to the SAIP (per Articles 24-30 of the Law on Patents, Layout-Designs of Integrated Circuits, Plant Varieties, and Industrial Designs)." Would Saudi Arabia, please, describe its administrative procedures concerning compulsory licensing and elaborate on intention to use it for health protection purposes?

Answer Compulsory license can be issued base on a request from third party or from government agency and both need to submit all supportive documents that needs to grant compulsory license, such as the invention has not been exploited within four years or having exploited it in an inadequate fashion. (See article 24-29 of law). The intention to use it for health protection depends on many factors such type of heath crisis, number of patients and market needs and others but in any case, the use of compulsory license will be consistent with TRIPS provisions and its flexibilities.

Question 23 What was the reason for the transfer of the competent authority to issue compulsory licences from King Abdulaziz City for Science and Technology to the Saudi Authority for Intellectual Property?

Answer The reason for transfer of the competent authority to issue compulsory licenses from King Abdulaziz City for Science and Technology to the Saudi Authority for Intellectual Property is due to the Council

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Question 24 Page 82 (Para 4.13) The Report informs that in June 2020 the authorities increased tariffs on certain agricultural products, such as dairy products, juices, and vegetable and olive oils, as part of the COVID-19 response. Could Saudi Arabia elaborate on the mechanisms used to notify importers and exporters about the changes in applied tariffs?

Answer The decision was made publically available on newspapers, social media and the official website of General Customs Authority giving importers and concerned entities sufficient time prior to the implementation.

II. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 25 Page 9 (Para 2.23) According to the Report the Ministry of Investment launched the "Invest Saudi" platform, which includes investment opportunities in various sectors, along with launching the identity (slogan) of "Invest in Saudi Arabia"; a unified national identity for marketing and attracting investments to the Kingdom. Would Saudi Arabia, please, provide more detailed information on the "Invest Saudi" platform?

Answer Saudi Arabia began a monumental national transformation with the launch of Vision 2030 in 2016, a strategy that expresses the Kingdom's long-term goals and expectations for its future and is centered around driving economic diversification. Increasing the amount of FDI into Saudi Arabia is the core element of how Vision 2030 is being achieved. In response to the emerging need to unify the message of the many stakeholders telling the exciting story of Saudi Arabia's offering to global investors, in 2018, INVEST SAUDI was initiated by a Royal decree to become the national investment promotion and attraction brand for Saudi Arabia so the Kingdom could go out into the world using one collective voice. Under the Royal decree and governed by Saudi Arabia's Ministry of Investment (MISA), INVEST SAUDI is mandated to bring together all government entities under one umbrella to position Saudi Arabia as an attractive investment destination. Leveraging a wide variety of initiatives and promotional campaigns, INVEST SAUDI works to increase Saudi Arabia's performance in 'doing business' rankings, develop and promote the opportunities opening up in newly unlocked sectors, and foster global partnerships that amplify the brand's impact and exposure. INVEST SAUDI aims to increase its levels of brand awareness, compete with the world's top IPA brands, and increase the number of FDI projects being undertaken in Saudi Arabia. The brand's strategy is centered around strengthening the perception of the country as an attractive investment destination amongst both local and international investors; maximizing awareness of national and sectorial value propositions; promoting investment opportunities and incentives; and generating quality leads for investment opportunities across all sectors.

Question 26 Page 13 (Para 3.43) The Report states, that Saudi Arabia has introduced the permanent residency programme designed to attract foreign investment. Premium Residency holders will be granted the right to invest in various fields such as industry and real estate, in addition to job mobility. Could Saudi Arabia, please, clarify how the permanent residency programme, focused to attract foreign investment, works (what are its coordinating bodies/units, main tasks and functions, results, successful examples etc.)?

Answer The Premium Residency Center is currently working on the new strategy that will launch new products and programs. (Please Check with Investors Services and Advisory for further information).

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Question 27 The Report notes, that Saudi Arabia has established "the National Committee for Enforcing Intellectual Property Rights". Could Saudi Arabia kindly inform how the process of establishing and functioning of the National Committee for Enforcing Intellectual Property Rights is contributing to the enforcement against IP infringement and piracy?

Answer The committee aims to improve the work of the enforcement ecosystem and enhance efforts aimed to Develop work methods and procedures, achieving harmony and coordination and coordinating efforts between government and private entities to enhance the enforcement intellectual property rights.

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UNITED KINGDOM

I. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 SUMMARY Paragraph 8 Will there be further consideration on specific professional skills and qualifications, across sectors, that could be transferred and recognised to open the market for jobs and foreign investors, who would be looking to set up in Saudi Arabia?

Answer The kingdom focus is directed toward sectors rather than persons or skills. Liberalizing further sectors to overseas investors will lead to have more skilled investors and employees.

Question 2

2 TRADE AND INVESTMENT REGIMES 2.3 Trade Agreements and Arrangements 2.3.1 WTO Paragraph 2.23

Saudi Arabia is presently an observer to the WTO Agreement on Government Procurement (GPA). Can Saudi Arabia elaborate on any future ambition to start negotiations to join the GPA as a member?

Answer Government procurement has important implications for Saudi economic development and diversification plans specially in the face of current circumstances. In this regard, it is worth mentioning that the confirmation by Saudi representative at the time of accession was specific to a previous version of the Agreement.

Question 3

2 TRADE AND INVESTMENT REGIMES 2.4 Investment Regime Paragraph 2.54 Are there plans to change exemptions to include law firms, insurance firms and other service sectors?

Answer Insurance firms is already liberalized; other sectors are under consideration.

Question 4

2 TRADE AND INVESTMENT REGIMES 2.4 Investment Regime Paragraph 2.60 Are there any planned changes for future withholding tax policy?

Answer Currently there is no plan to change the withholding tax policy, however, the Government of Saudi Arabia regularly evaluates and reassesses the various tax it implements based on many considerations including fiscal & economic conditions, international best practices, transparency, and international standards.

Question 5

2 TRADE AND INVESTMENT REGIMES 2.4 Investment Regime Paragraph 2.63 Please elaborate on the decision to increase fees for business visas and entry/exit permits for foreign workers, and to increase levies on expatriates with dependents, in light of MISA's commitment to

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"facilitate entry procedures for non-Saudi employees, including technicians, administrators, and their dependencies" and whether there are any further plans to change fees for visas? (Box 2.1).

Answer The regime for expatriates and their dependents had been announced in 2017 and has not changed. Business visa fees were adjusted to align with the cost of sponsoring an expatriate worker as several businesses were abusing the business visas for long-term employment. Entry/exit permit costs have remained constant for decades and were slightly adjusted in lieu of recent reviews. Nevertheless, the recent labor mobility initiative significantly facilitates cross-border movement for expatriates. Additionally, there is ongoing work to facilitate and exempt skilled expatriate workers as part of the Kingdom’s Vision 2030 plan to reduce dependence on oil, and they will be announced in due course.

Question 6

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.1 Measures Directly Affecting Imports 3.1.4 Tariffs 3.1.4.1 MFN applied tariffs Paragraph 3.31 Raised import tariffs Please elaborate on the justification for the introduction of higher import tariffs of certain goods by Saudi Arabia (above those applied by other GCC states) and what this means for the future of the GCC customs union.

Answer Within the framework of the WTO, the Kingdom of Saudi Arabia has already been committed to the bound rates indicated in its tariff schedules. Consequently, any adjustment to the customs duty rate shall not exceed the bound rates to which the Kingdom has been committed to WTO. The Kingdom of Saudi Arabia solely has goods with a customs tariff of more than 5%.

Question 7

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.2 Measures Directly Affecting Export 3.2.5 Special Economic Zones Paragraph 3.83 What programmes or other measures does Saudi Arabia plan in order to help foreign companies become local manufacturers in the special zones?

Answer These zones’ main purpose is to create an attractive business environment to attract FDIs, which will in turn create jobs and contribute to the country’s GDP. Each of the launched zones will be focusing on certain sectors, these zones will develop sector specific regulations along with the general business regulations, which will be amended to create an attractive and competitive environment.

Question 8

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.2 Standards and technical requirements Paragraph 3.107 Does SASO maintain a list of mandatory standards and will they be available online and free of charge?

Answer All adopted standards and technical regulations can be found on SASO’s official website on the following links: • https://wasif.saso.gov.sa/ • http://www.saso.gov.sa/en/laws-and-regulations/technical_regulations/pages/default.aspx

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Copyright and intellectual property restrict standardization bodies in the GCC countries from making national standards available free of charge, given that most of them are adopted by international and regional standardization bodies.

Question 9

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.2 Standards and technical requirements Paragraph 3.114 What are Saudi Arabia's plans for the SASO Quality Mark, and will Saudi Arabia adhere to the 6- month TBT requirement for any future changes? How can producers check the existing requirements (in English) and ensure they get notified of future changes?

Answer The future plans for the Saudi Quality Mark depend mainly on the legislations issued in the Saudi technical regulations, which are notified to the members of the World Trade Organization according to the established commitments, and producers can check the requirements of the current quality mark in English via the following link: http://www.saso.gov.sa/en/eservices/pages/details.aspx?serviceid=381

Question 10

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.1 Measures Direction Affecting Imports 3.3.2 Standards and technical requirements Paragraph 3.116 Can Saudi Arabia elaborate on whether they will provide the 6 months requirement as referred to in paragraph 3.107 before any new changes to food standards and regulations and elaborate on the implementation of nutritional labelling?

Answer All draft standards, technical regulations, and conformity assessments usually are in a period of six months at least between final publication and entry into force.

Question 11

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.3 Sanitary and phytosanitary measures Paragraphs 3.123, 3.124, 3.125 Why are Saudi Arabia moving away from accepting the GCC Halal accreditation?

Answer Accreditation certificate is based on GSO 2055-2 which is acceptable by any Accreditation body.

Question 12 Will Saudi Arabia delegate audits and approval of food and other certifications to competent authorities in exporting countries?

Answer Yes, this is already applied with UK establishments (Sheep meat, sea caught fishery products, milk products) For poultry, eggs and other fishery products, the local importer is required to apply for an import permit.

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Question 13

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.6 Government procurement Paragraph 3.170 Could Saudi Arabia explain how the new GTPL will impact intellectual property ownership in international collaborations?

Answer There is no direct impact of GTPL since the ownership of intellectual property is determined by intellectual property laws and subject to the agreement between contracting parties.

Question 14

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.1 Overview Paragraph 3.182 Please confirm if the transfer of duties to SAIP has been completed from previous government departments and offices responsible for intellectual property rights.

Answer The transfer of duties has been completed, except some enforcement procedures such as inspection and seizing which is still handled by the ministry of commerce.

Question 15

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.1 Overview Paragraph 3.183 Could Saudi Arabia confirm if the draft national IP strategy available in English and if so, provide a copy?

Answer National IP Strategy is under consideration and being prepared along with National stakeholders.

Question 16

3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.1 Overview Paragraph 3.185 The UK participated in the Global Intellectual Property Challenges Forum (IP20+) in October 2020. Could Saudi Arabia confirm if IP20+ generated any specific outcomes and if the forum will be it be repeated next year?

Answer As stated in the Joint Statement, the head of the Intellectual Property Offices operating in the G20 countries (IP20+), participated in the Global Intellectual Property Challenges Forum, agreed to strive to: • Exchange IP policy. • Encourage voluntary dissemination • Explore practices and procedures of IP Offices. • Exchange experiences in the use of digital technologies. • Promote the role of the World Intellectual Property Organization (WIPO). • Enhance IP cooperation among G20 countries.

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• With regard to weather the forum will be repeated next year or the upcoming years in general, there is no update or further information on this regard, except what stated on the joint statement that the IP20+ share a willingness to consider future IP20+ meetings.

Question 17

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.2 Copyright and related rights Paragraph 3.191 As Saudi Arabia Copyright Law prohibits "parallel imports of copyrighted materials" – please can it be confirmed whether this applies to services i.e., digital/ wireless/ broadcast materials", as well as physical goods.

Answer The prohibition of prohibits parallel imports of copyrighted materials is not explicitly stated in the copyright law, but rather it is an interpretation and application of many factors and judicial principles such as the type of the work, the nature of the contracts” the implied conditions of the contract’ and other factors. Therefore, even though parallel imports are considered infringements as a general interpretation the determination of whether a such import is an infringement may vary.

Question 18

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.2 Copyright and related rights Paragraph 3.192 Please can Saudi Arabia give examples of "other types of copyrighted works" that can be registered under Art 3(3) of the Regulations for Optical Copyrights Registration Decision No. 03/07/2019 dated 07/06/1440H (12 February 2019)?

Answer For example: 1. Written materials like books, booklets and others. 2. Works which are verbally delivered like lectures, speeches, poetry, songs and the like. 3. Dramatic works, plays, shows and similar presentations which involve motion, sound or both. 4. Works which are especially prepared for broadcasting or are presented through broadcasting. 5. Drawings, works of plastic arts, architecture, decorative art and artistic embroidery and the like. 6. Sound and audio-visual works. 7. Applied art works, whether handcrafted or manufactured. 8. Photographic works and the like. 9. Illustrations, geographical maps, designs, plans, sketches and sculptured works related to geography, topography and science. 10. Three-dimensional works of geography, topography, architecture or science. Numbers 3,5,6,7,8,9 are going to be ready for registration by the end of 2021.

Question 19

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.2 Copyright and related rights Paragraph 3.193 Please can Saudi Arabia confirm if any actions have been taken under copyright laws and procedures in relation to copyright infringement on the internet?

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Answer The Saudi Authority for Intellectual Property conducts online inspection visits to detect the compliance of Intellectual property, as during 2020 more than 300 websites violating intellectual property rights were temporary blocked. SAIP continues to carry out inspection visits in parallel with the improvement of procedures.

Question 20

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.3 Industrial property Paragraph 3.194 Under Saudi Arabia's industrial property and enforcement legislation, are the general rules regarding exhaustion of rights and parallel imports for patents and trademarks publicly available? If so, please indicate where they can be found or obtained.

Answer Legislation and rules are on the websites of the Ministry of Justice and the Saudi Authority for Intellectual Property (SAIP), in addition the Ministry of Justice constantly publishes all cases related to intellectual property.

Question 21

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.3 Industrial property Paragraph 3.195 Please can Saudi Arabia confirm if patent legislation has been amended pursuant to the public consultation referred to in para 3.195.

Answer SAIP is currently reviewing the law of patent, layout designs of integrated circuits, plant varieties and industrial design. SAIP issued a public consultation request to gather feedback from the public.

Question 22

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.3 Industrial property Paragraph 3.196 Regarding industrial property, specifically the 2001 Economic Agreement and the requirements therein for GCC member states, please can Saudi Arabia advise if information is available on each member state policy and the coordination protocol with other countries and regional/ international organisations? Do these policies include IP enforcement?

Answer There are many polices and projects which resulted from the 2001 Economic Agreement, such as the agreement between the GCC countries to negotiate as a single block instead of negotiating with each country individually. In addition, the establishment of the GCC patent office and the GCC patent law are results of the mentioned agreement. For more information, you may contact the Secretariat General of the Gulf Cooperation Council.

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Question 23

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.3 Industrial property 3.3.7.3.2 Trademarks and geographical indications (GIs) Paragraph 3.197 Please could Saudi Arabia indicate whether SAIP are intending to join the Madrid systems for international trademarks?

Answer Madrid Protocol is under consideration by Saudi Arabia for possible accession.

Question 24

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.3 Industrial property 3.3.7.3.2 Trademarks and geographical indications (GIs) Paragraph 3.198 Please can Saudi Arabia update on the project with SAIP for the protection of geographical indications and if the specified list of protected products is available.

Answer Saudi Arabia is still working on the development of a sui generis law for the Protection of Geographical Indications. The Saudi Authority for Intellectual property is currently working on confining a list of potential national GIs. However, since the law is not in force yet, none of them are registered.

Question 25

3 TRADE POLICIES AND PRACTICES BY MEASURE 3.3 Measures Affecting Production and Trade 3.3.7 Intellectual property rights 3.3.7.3 Industrial property 3.3.7.3.4 Patents Paragraph 3.202 Following the announcement of the 41st meeting of the Supreme Council of the GCC on 5th January that GCCPO has stopped accepting new patent applications as of 6th January, please can Saudi Arabia provide a further update as to why this decision was made and (b) has patent legislation been amended accordingly?

Question 26 Please elaborate on when these changes will be made public.

Answers 25 & 26 The GCC countries collaboratively have worked together to develop and update the GCC Patent system. The patent law of the GCC patent office and its bylaw will be published in the GCC patent Gazette and shall be effective after specific period from the date of its publication. For more information, you may contact the Secretariat General of the Gulf Cooperation Council.

Question 27

4 Trade Policies by sector 4.4.2 Telecommunications Paragraph 4.143 On digital two-way flow of data across borders, the documents refer to data localisation for sensitive data. Please can Saudi Arabia clarify what data is considered sensitive? Will any future market access regulation be linked to the flow of data or data localisation?

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Answer There are no trade restrictions on cross-border data flows or localization requirements as long as national laws and regulations are met and do not constitute national security risk.

I. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 28

INTRODUCTION 1.2 Labour Reform Initiative Paragraph 1.20 Please elaborate the criteria of the contractual relationship enhancement. For example, what protections/obligations will be available to workers?

Answer The labor reform initiative is a significant policy shift for expatriate workers in the Kingdom. The Kingdom is following the research that shows greater mobility is beneficial to the labor market and the economy. The initial rules are just those: initial rules. The impact of the reform will be evaluated closely and enhanced in the future. The reform primarily focuses on enhancing labor mobility for expatriate workers and as such leads to some indirect protections such as removing employer controls on travel and transferring employment. The obligations remain as before: an employee typically requests vacation approval, and gives contractual notice upon desiring to end employment with an employer.

Question 29

INTRODUCTION 1.2 Labour Reform Initiative Paragraph 1.21. Please elaborate on purposes and benefits of retaining an employer notification as part of the LRI.

Answer As mentioned in answer to question 27, these are initial rules that will be evaluated and enhanced in future. The reform is a large shift for businesses and the notification system is there merely to help them coordinate their activities. As businesses get used to the new regulations, the notifications may be deemed superfluous and removed.

Question 30

ECONOMIC DEVELOPMENT 2.1 Economic Growth Paragraph 2.4. Please elaborate the approaches Saudi Arabia is expected to use to lower the unemployment rate.

Answer As part of the Vision 2030 plan to reduce dependence on oil, the Kingdom intends to grow a range of economic industries such as advanced manufacturing, banking, entertainment, IT, leisure and tourism, and logistics. Several gigaprojects have already been announced and others are at various stages of development. This growth will lead to growth in jobs and reduce unemployment.

Question 31

Please explain the criteria for the unemployment figures used by Saudi Arabia.

Answer Unemployment is calculated and published by GASTAT via a quarterly labor force survey. The criteria are published on the GASTAT website and closely follows the ILO definition for determining unemployment that is used in many countries.

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Question 32

3 TRADE POLICY DEVELOPMENTS 3.1 Tariffs, Other Measures Affecting Imports 3.1.6 Exports and free zones Paragraph 3.19 Please elaborate on the criteria for sustainable regulations. For example, what protections would there be for workers?

Answer Various protections are granted to workers either foreigners or nationals, and are incorporated as an integral part to the labor’s Law.

Question 33

3 TRADE POLICY DEVELOPMENTS 3.6 Trade-Related Intellectual Property Rights (TRIPS) Paragraph 3.40 Please clarify what benefits GCC Trademark Law confers to the right's holder if it does not provide for unitary registration.

Answer To harmonize the procedures related to trademarks in general including but not limited to registration procedures in the GCC countries.

Question 34

3 TRADE POLICY DEVELOPMENTS 3.6 Trade-Related Intellectual Property Rights (TRIPS) Paragraph 3.41 Since Saudi Arabia issued the Law of Commercial Courts, have any IP cases been referred and/or heard?

Answer Yes, and the number of the IP cases are (99) in the last (2) years.

Question 35

3 TRADE POLICY DEVELOPMENTS 3.6 Trade-Related Intellectual Property Rights (TRIPS) Paragraph 3.42 Please can Saudi Arabia provide further detail on amendments to IP legislation and which IP rights are included in this review?

Answer SAIP is currently reviewing the copyright law, the law of patent, layout designs of integrated circuits, plant varieties and industrial design, and Regulations for the Protection of Confidential Commercial information to propose drafted amendments. With the exception of Patent law, SAIP issued a public consultation request to gather feedback from the public on ne drafted copyright law and Regulations for the Protection of Confidential Commercial information to collect issues, and address them in a new draft of laws. SAIP, also, is working on proposal of new draft law for geographical indications which had been published for public feedback

Question 36

3 TRADE POLICY DEVELOPMENTS 3.6 Trade-Related Intellectual Property Rights (TRIPS) Paragraph 3.43 Please can Saudi Arabia elaborate on the structure of the National Committee for Enforcing Intellectual Property Rights and which government entities are included? For example, an organisational model or mission statement?

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Answer National Committee members are: Public security, Ministry of media, Ministry of commerce, Saudi authority for intellectual property, Ministry of Justice, Saudi customs, Communications & information technology commission, Council of Saudi Chambers, Saudi food & drugs Authority, General Commission for Audiovisual Media and Public prosecution. The Committee aims to improve the work of the enforcement system and enhance efforts aimed at developing work methods and procedures, achieving harmony and coordinating efforts between government and private agencies, enforcing intellectual property rights, and upgrading them to a level benefitting the status of the Kingdom of Saudi Arabia.

The Objectives:

1. Raise the level of enforcement to enhance the international recognition of the Kingdom. 2. Consolidate the responsibility regarding enforcement of intellectual property rights. 3. Coordinate between IP enforcement agencies. 4. Strengthen the legislation and the regulatory aspect.

Question 37

4 Sectoral Developments 4.6 Services 4.6.2 Tourism services Paragraph 4.64 Movement of natural persons. As part of Tourism services, the on-arrival-visa programme has been extended to visitors holding a valid Schengen, UK or USA visa. Are there any plans to expand this to include short term business visitors and mode 4 generally? We would likewise appreciate additional information on the requirements for short term business visitors.

Answer Currently, Kingdom of Saudi Arabia government is working on a project to unify the visa for visiting purpose to includes all the visiting purposes as (leisure, business, VFR and others). In addition, we are studying the expansion for the business visa category eligibility to include the visa holders (one of the group B countries, Schengen, UK and USA) to enable them apply for the visa through the online platform, upon arrival, or through embassies. In general, requirements and procedures for issuing visas for all purposes of the visit are evaluated and developed through the year and being updated based on the circumstances.

Question 38

6 FUTURE DIRECTION OF SAUDI ARABIA TRADE POLICY 6.2 Saudi Arabia and New Sources of Energy 6.2.1.1.2 Renewable Energy Paragraph 6.10 The report sets out some helpful detail on the National Renewable Energy Programme (NREP), which is intended to increase the share of renewables in Saudi Arabia's energy mix. What role does Saudi Arabia see trade policy playing in the development of its renewable energy industry? For example, has Saudi Arabia considered unilateral reductions in applied tariffs for goods to support renewable energy such as wind power generation?

Answer One of Saudi Arabia's priorities is the development of renewable energy industry. Saudi Arabia is keen to enable the renewable energy and seeks to minimize barriers from global trade. However, the role of trade policy formation in the energy arena is important.

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UNITED STATES

II. QUESTIONS REGARDING THE SECRETARIAT REPORT

Question 1 Page 39, paragraph 3. The Secretariat Report states that the Saudi Customs Authority (SCA) has cancelled the requirement for authentication of invoices and documents from the Chamber of Commerce and Embassies. Does SCA require authentication by Embassies, consulates, or Chambers of Commerce for any other customs documents?

Answer No, authentication by Embassies, consulates, or Chambers of Commerce for any customs documents.

Question 2 Are such requirements in place for documents required by any other government agency that regulates imports, i.e. SFDA, SASO, etc.?

Answer For food authentication of invoice is not required for Drugs, an authenticated invoice is required; chemicals require an invoice and certificate of origin to be authenticated. For medical devices authenticated invoice is required for cosmetics and authenticated invoice is required for ready for sale products. However, the raw material for cosmetics require certificate of origin to be authenticated and the invoice. The governmental or the third party the SFDA approved is responsible for the process of notrarization

Question 3 Is notarization required for any import documents? If so, what measure imposes the requirement for notarization? Who is recognized to provide notarization?

Answer Notarization is not required for any import documents

Question 4 Page 47, paragraph 3.45: The Secretariat Report notes that Saudi Arabia ratified the GCC Common Excise Tax Agreement. Pursuant to the provisions of the Agreement, Saudi Arabia issued the Excise Tax Law and the Implementing Regulations of the Excise Tax Law. The excise tax is an indirect tax that is chargeable upon releasing certain goods for consumption in Saudi Arabia. Two excise tax rates (50% or 100%) are applied to: soft drinks (50%); sweetened drinks (50%); tobacco-related products (100%); energy drinks (100%); electronic devices and equipment used for smoking, vaping, and similar activities (100%); and liquids consumed in electronic devices and equipment used for smoking, vaping, and similar activities (100%). The United States notes that this tax does not follow established international best practice linking taxes to a product's sugar content. How does Saudi Arabia plan to pursue this agreement without discriminating between beverage categories?

Answer Firstly, the Kingdom emphasizes that neither its domestic excise tax legislation nor the Unified Excise Tax Agreement for the GCC mandate ("Excise Legislation") result in unequal or dissimilar taxation of products based on the products origin. Furthermore, discrimination between imported and domestic products is not an intended or incidental consequence of the Excise Legislation.

Question 5 What is Saudi Arabia's formal mechanism for consultation with private industry, trading partner governments, and other interested parties regarding the selective tax, particularly in advance of possible revisions?

Answer Saudi Arabia's legislative process entails a rigorous public consultation process to obtain feedback and commentary from the private sector and any interested party on draft tax legislation or amendments to existing legislation prior to their enactment. Below is an overview of the process. -

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First, the draft legislation is published on a national portal dedicated to public consultation. Any interested party may submit comments/opinions/feedback during the consultation period which in all cases is no less than 30 days. -Once the public consultation period ends, all comments must be collated before submitting the draft legislation to the council of ministers ("CoM") for consideration; a report of the comments received is also published on the portal after the public consultation period ends. Note that it is strongly encouraged, and indeed common practice for the draft legislation to be amended to reflect repeated comments. -When the draft legislation is submitted to the CoM it must be accompanied by a number of reports and studies that justify the legislation, in addition to comparative studies to highlight best practice with respect to the subject of the legislation. -The public commentary must also be submitted to the CoM; any changes made to reflect the commentary must be highlighted. Further, there must be strong justification for the rejection of comments received during the public consultation. Any possible revision of the excise tax legislation in the Kingdom would be subject to this process. Q6: As soon as the GCC member states reach an agreement as to the details of the new selective tax (excise tax) model, a resolution and execution plan will pass through a formal circulation by GCC member-states, and be announced to the public through official channels.Saudi Arabia's legislative process entails a rigorous public consultation process to obtain feedback and commentary from the private sector and any interested party on draft tax legislation or amendments to existing legislation prior to their enactment. Below is an overview of the process. -First, the draft legislation is published on a national portal dedicated to public consultation. Any interested party may submit comments/opinions/feedback during the consultation period which in all cases is no less than 30 days. -Once the public consultation period ends, all comments must be collated before submitting the draft legislation to the council of ministers ("CoM") for consideration; a report of the comments received is also published on the portal after the public consultation period ends. Note that it is strongly encouraged, and indeed common practice for the draft legislation to be amended to reflect repeated comments. -When the draft legislation is submitted to the CoM it must be accompanied by a number of reports and studies that justify the legislation, in addition to comparative studies to highlight best practice with respect to the subject of the legislation. -The public commentary must also be submitted to the CoM; any changes made to reflect the commentary must be highlighted. Further, there must be strong justification for the rejection of comments received during the public consultation. Any possible revision of the excise tax legislation in the Kingdom would be subject to this process. Q6: As soon as the GCC member states reach an agreement as to the details of the new selective tax (excise tax) model, a resolution and execution plan will pass through a formal circulation by GCC member-states, and be announced to the public through official channels.

Question 6 What is the timeline to inform private industry, governments, and other interested parties about the study being undertaken by GCC Member States on revising this tax?

Answer Although the new excise tax model has yet to be agreed upon among the GCC states, Saudi Arabia will formally announce the timeline for enforcing the new excise model shortly after the GCC states reach an agreement.

Question 7 When and how will Saudi Arabia switch from an ad-valorem tax to a graduated tax based on sugar content in beverages?

Question 8 Will Saudi Arabia revise this tax to also cover fruit juices and milk-based products that contain added sugars in which the total sugar content (from either natural and/or added sugars) exceeds the minimum threshold of 5g per 100ml?

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Answer Currently, excise tax is not assessed on beverages that do not contain added sugar. Exempting or applying a different excise tax rate to beverages based on caloric content is among the options being considered at the GCC level.

Question 9 Will Saudi Arabia exempt beverages that contain no added sugar as well as low-calorie beverages from this tax?

Answer Any decision on the exemption of a particular beverages category that is subjected to tax will be based on the studies conducted and agreement reached by the GCC member-states in this regard.

Question 10 Page 47, paragraph 3.45 The United States has requested that until Saudi Arabia implements revisions to this tax, that Saudi Arabia: (1) end discrimination between energy drinks and other beverages currently covered by the tax that have similar amounts of sugar, (i.e. harmonize and apply the same tax rate to all beverages subject to the excise tax); and (2) exempt low-caloric beverages from the tax altogether. What is the status of Saudi Arabia's consideration regarding this request?

Answer Saudi Arabia reaffirms that excise regime is not and was not discriminatory in any way. The difference in the tax rate between energy drinks and sweetened drinks is based on the inherent difference between the types and contents of the beverages. Thus, the appropriate tax rate is applicable to a drink depending on how its categorized on the basis of the legal definition for each type of beverage.

Question 11 What is the status of Saudi Arabia's consideration regarding the long-term implications of continued industry volume decline for: (1) sustainable streams of tax revenue; (2) upstream, direct and downstream employment and investments; and (3) viability of the beverage industry in Saudi Arabia?

Answer The excise tax was imposed on the basis of public health considerations. Tax revenue was not in-and- of-itself the objective behind implementing the excise tax. Accordingly, the decrease in volume of these products and the resulting decrease in tax revenue from excise products is an indicator of a decrease in the sales, production and/or demand for these products, all of which also indicate a decrease in individual consumption of such goods. These results would suggest that the tax has been effective in achieving the desired public health objectives. Generally, negative implications affecting some aspects of the economy are incidental to the introduction of new taxes or an increase in existing taxes. Saudi Arabia foresaw the long-term implications mentioned in the question prior to implementing the excise tax and took them into consideration in making the decision to implement the tax. In addition, Saudi Arabia is ready to take any action needed counteractions in taken action to minimize incidental adverse effects the tax may have on the economy.

Question 12 Page 47, paragraph 3.45 Private industry stakeholders have suggested that Saudi Arabia revise the Excise Tax Law and the Implementing Regulations of the Excise Tax Law. For example, it would be in line with established international best practice models to establish a broader product base with significantly lower rates and provide non-discriminatory treatment of beverage categories through a graduated tax system based on sugar content that incentivizes product reformulation. Has Saudi Arabia considered less disruptive alternatives to the excise tax?

Answer The Government of Saudi Arabia regularly evaluates and reassesses the various tax it implements based on many considerations including fiscal & economic impact, international best practices, transparency, and international standards. However, Saudi Arabia does not consider that their excise tax practices are now or were - at any point - discriminatory as the tax is neutral on its face and in fact with respect to place of origin, and same or like products are not subject to different tax

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Question 13 Page 53, paragraphs 3.79 and 3.80: According to the Secretariat Report, the Saudi Export Program (SEP) is Saudi Arabia's official national export credit agency, with the objective of diversifying non-oil exports through the provision of financing to Saudi exporters. SEP facilitates trade transactions through local and foreign banks, offering financing through loans and credit insurance services. Please explain the basis for not reporting SEP's 2018 export financing support activities for agricultural and food products in the 2019 Export Competition Questionnaire (ECQ).

Answer Throughout 2018, no financing activities took place for the agriculture and food products sector. Nevertheless, SEP does not provide financing supports as much as non-oil product credit facilities.

Question 14 Page 56, paragraph 3.99 The Secretariat Report notes that Saudi Arabia has notified the WTO that it does not grant or maintain any subsidy programs as defined in Article 1.1 of the Agreement on Subsidies and Countervailing Measures (G/SCM/N343/SAU). However, the Secretariat Report also provides information regarding the economic diversification plans under Vision 2030, under which Saudi Arabia aims to become a leading industrial powerhouse and a global logistics hub. According to the Secretariat Report, an important component of Vision 2030 and the National Industrial Development and Logistics Program (NIDLP) is the creation of special economic zones (SEZs), which provide incentives in competitive locations for "promising" sectors. Paragraph 3.85 of the Secretariat Report provides details regarding special tax rules applied to activities carried out in the SEZs. Please explain the various types of incentives that have been enacted in order to meet the economic plans under Vision 2030 and the NIDLP.

Answer The Government of Saudi Arabia has enacted the Law of the Special Integrated Logistics Zone ("Zone Law") pursuant to Royal Order No. A/17 on 10 October 2018. The Zone Law contains the following tax provisions: (1) customs duties and VAT are suspended on goods that enter in the zone and are not imported into the mainland, including goods in transit and temporary transfer of goods into the zone. (the Zone Law, Article 8(1)) (2) No VAT is due on the transfer of goods between the mainland and the SEZ for repair and maintenance; (the Zone Law, Article 8(3)). (3) a nonresident of Saudi Arabia will not have a permanent establishment therein if they transact with other non-residents in relation to goods located in the zone only as a result of the goods being stored/warehouse/available in the zone. (the Zone Law, Article 9) Pursuant to article 10 of the Zone Law, the General Authority of Zakat & Tax ("GAZT") is to issue special tax rules to be applicable in the zone. Pursuant to Article 10 of the Zone Law, Special Tax Rules will be enacted. Pursuant to the Special Tax Rules, companies residing in the zone are entitled to the following direct tax incentives: (1) tax relief (0% income tax) for a maximum period of 50-years upon the satisfaction of certain conditions. (2) 0% withholding tax for a maximum period of 50 years for royalties, dividends, income from debt (interest) and payments for technical services.

Question 15 Please further explain why incentives were not notified in accordance with Saudi Arabia's WTO obligations.

Answer Saudi Arabia considers the above referenced tax rules -as stated in the Zone Law- are not incentives nor subsidies and thus outside the purview of the notification requirement. This is so because the tax rules are not a deviation from the tax laws applicable now and at the time of the Zone Law's enactment. In other words, the Zone Law does not contain any provision that grants an exemption, incentive, or special tax treatment. At the time the Secretariat Report was drafted and submitted, no other tax incentives were applied in the Kingdom. The rules states in the Zone Law are indeed the default rules that apply nation-wide and are available to all taxpayers in the base economy and the zone alike. Their inclusion into the Zone Law were for purposes of explicitly stating them and

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- 148 - clarifying them. Under the existing VAT law, import VAT is suspended on goods that are under customs suspension (such as suspension of customs for goods in transit). In addition, where goods are transported between the base economy and the zone, they are treated as a domestic transfer of goods for VAT purposes thus no import VAT is triggered when goods enter the base economy or the zone since there is no actual "import". Further, the VAT law stipulates that the export of goods is zero-rated. However, since the zone is still within the territory of the Kingdom, transport of goods from the mainland to the zone is not legally an export. Finally, with respect to the treatment of permanent establishments (referenced in paragraph (3) of the previous question), the transactions contemplated in the Zone Law would not trigger a PE in the Kingdom. Warehousing of goods alone is not sufficient nexus to trigger a PE for the legal owner of the goods in the Kingdom when transacting for their sale (for instance) with another nonresident.

Question 16 Page 57, paragraph 3.101: The Secretariat Report states, "Saudi Arabia's relevant legislation, notably the Technical Regulation, can be found on the SASO's website, the national notification authority and enquiry point for TBT matters. The SASO, under the Ministry of Commerce, is the main agency responsible for developing national standards, quality control and assurance, conformity assessment, and certification. In 2019, the Saudi Accreditation Center (SAC) was created as the national accreditation body. It is an independent public entity, under the supervision of Ministry of Commerce." The United States notes several instances where U.S. Enquiry Point communications have gone unresolved. Please address the following outstanding communications: The U.S. WTO TBT Enquiry Point requested in January 2020 that the WTO TBT Enquiry Point of Saudi Arabia clarify the status of implementation of GSO Draft Standard 1926:2019," notified as G/TBT/N/SAU/1104. When does Saudi Arabia intend to provide such a clarification?

Answer Kindly note that, the SFDA.FD 1926 entered into force in 01.01.2020

Question 17 The U.S. WTO TBT Enquiry Point sent comments on the "Saber Conformity Assessment Online Platform / Saleem Product Safety Program" on behalf of U.S. stakeholders to the WTO TBT Enquiry Point of Saudi Arabia in May 2020, and requested copies of all other relevant notifications to the WTO, as well as copies of all relevant regulations instituting the program and those outlining the scope of product coverage, in February 2020. When does Saudi Arabia intend to respond to these requests?

Answer KSA proposes discussing this inquiry and the technical issues associated with it through the channels of the Technical Barriers to Trade (TBT) Agreement.

Question 18 The U.S. WTO TBT Enquiry Point requested in November 2020 and December 2020 that the WTO TBT Enquiry Point of Saudi Arabia notify any and all regulations promulgated or implemented by the SFDA Halal Center, including "Draft Technical Regulations for Appointing Halal Certification Bodies (1442/2020)," to the WTO Secretariat under terms of the TBT Agreement. When does Saudi Arabia intend to provide such a notification?

Answer The referred notification will be submitted in due time to the SPS committee.

Question 19 The U.S. WTO TBT Enquiry Point requested in April 2018 that the WTO TBT Enquiry Point of Saudi Arabia notify the "Guidelines to the Requirements of Registration and Accreditation of Facilities and Products of Children's Milk, Substitutes of Breast Milk, and Supplementary Dairy Foods for Special Medicinal Uses" to the WTO Secretariat under terms of the TBT Agreement. When does Saudi Arabia intend to provide such a notification?

Answer The "Guideline to the Requirements of Registration and Accreditation of Facilities and Products of Children's Milk, Substitutes of Breast Milk, and Supplementary Dairy Foods for Special Medicinal Uses" is currently not valid and has been removed from SFDA website. Moreover, a new guideline

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- 149 - was published (Guide to control the circulation of Processed breast milk substitutes, Supplementary milk foods, and infant foods for special medicinal uses). However, the SFDA believes that there is no need to notify the new guideline as it was based on the previously approved conditions and requirements for food import that has already been notified to the SPS Committee.

Question 20 The U.S. WTO TBT Enquiry Point sent comments on "Technical Regulations B M- IV Bricks, tiles, ceramics, sanitary ware and related products," notified as G/TBT/N/SAU/993, on behalf of U.S. stakeholders to the WTO TBT Enquiry Point of Saudi Arabia in October 2017. When does Saudi Arabia intend to respond to these requests?

Answer SASO received a comment dated 2 October 2017 through the TBT inquiry point of Plumbing Manufacturers International in the United States regarding notification number G / TBT / N/SAU / 993 related to SASO 1477 and SASO 1473, and the response was sent to the United States to [email protected] on 4 October 2017.

Question 21 Page 57, paragraph 3.106 We understand that the Saudi Standards, Metrology and Quality Organization (SASO) introduced the "SABER" platform in order to protect commercial facilities from fraud and tampering with technical documents and to ensure products are free from defects that may affect the health, safety, and the environment of the consumer. We note that the registration and certification process for the SABER platform is complex. The United States remains concerned about implementation of the "Saber Conformity Assessment Online Platform / Saleem Product Safety Program," which has also been a subject of discussion in the WTO TBT Committee meetings. Please provide copies of all relevant regulations instituting the program and those outlining the scope of product coverage.

Answer The technical regulations can be found in the official website of SASO, which provide the scope for each technical regulation. Please visit the link below for more details: http://www.saso.gov.sa/en/laws-and-regulations/technical_regulations/pages/default.aspx

Question 22 When will Saudi Arabia implement clear and transparent guidelines regarding the application of the SABER platform?

Answer Saber is an electronic service that reflects the Saudi technical regulations.

Question 23 We note that industry reports highlight that HS codes on the SABER system often do not match international HS codes. Please provide the list of products (using complete HS Codes having 10 digits) for which SASO will require third-party certification and new certificates of conformity instead of self-declarations.

Answer Please visit the website below to find the requirements for each HS-code, and note that you can search by using the first 6 digits since it is matching the international HS-code: https://saber.sa/home/hscodes Please note that the Saudi Custom is the entity responsible for the HS-code, and all HS-code can be found on their website therefore we recommend visiting their website to find the right HS-code that matches the product description.

Question 24 Further, we understand there is uncertainty regarding the current status of the implementation of the SABER platform. Please provide a complete list of all products currently covered under the SABER platform.

Answer Please visit the website below to find the requirements for each HS-code covered by saber, and note that you can search by using the first 6 digits since it is matching the international HS-code: https://saber.sa/home/hscodes

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Question 25 Please provide a list of all products that will be covered under the SABER platform and the dates for which conformity with the program will be required.

Answer Please visit the website below to find the requirements for each HS-code, and note that you can search by using the first 6 digits since it is matching the international HS-code: https://saber.sa/home/hscodes The date of implementation for each technical regulation can be found in the technical regulation page in Saber Platform. Please visit the link below for more details: https://saber.sa/home/regulations

Question 26 Page 57, paragraph 3.106 We note that Saudi Arabia states that the SABER platform has contributed to facilitating and enhancing trade. We understand that the process for conformity assessment procedures under the SABER program differs among Notified Bodies in terms of the required tests and number of required samples. How is SASO working to ensure that all notified bodies implement the conformity assessment procedures in the same manner?

Answer SASO audits the conformity assessment procedures and requirement to ensure fair trade. The result for these audits can be used to apply sanctions on the notified bodies. If you have any concerns regarding notified bodies you can contact SASO at [email protected]

Question 27 Please respond to the U.S. comments submitted on G/TBT/N/SAU/1143 (also notified as G/SPS/N/SAU/435) requesting scientific justification for prescribed agricultural and food products' mandatory shelf life limits, and share the document(s) containing the Technical Regulation.

Answer Our response to comments from the United States has been sent by email to (Senior Ag Marketing Specialist at U.S. Embassy, Riyadh, Saudi Arabia) on 2/8/2021 through Saudi SPS inquiry point. Brief of SFDA Response: In regards to SFDA response on U.S comments in the draft regulation of "Expiration dates for food products" we would like to clarify the following: The updated technical regulation is intended to covers maximum shelf- life for perishable food products, which will replace GSO 150-1. U.S comments on some definitions and the shelf- life of vacuumed beef meat were taken into consideration. item 3.4 in the draft which states that "The dates shall be engraved, embossed, printed or stamped directly onto the original label of all packages by the producer only…. etc" has been removed based on U.S comments. Finally, table 1 in the technical regulation applies to perishable food, and it intends to extend shelf life of such products. A measure we believe will allow for greater facilitation of trade.

Question 28 Page 58, paragraph 3.114 According to the Secretariat Report, "Products subject to technical regulations must comply with the relevant regulations before they are placed on the market. The Saudi Standards, Metrology and Quality Organization (SASO) may grant a certificate of conformity, or, for products that comply with standards and technical requirements, a license to use the quality mark. The quality mark scheme is voluntary, and available for goods either domestically produced or imported." In 2020, The Saudi Food and Drug Administration (SFDA) implemented a new technical standard that requires halal certifying bodies to be approved by SFDA, in addition to being registered with SASO. Our understanding is that SFDA now requires U.S. halal certifying bodies to work with SFDA to apply the SFDA halal mark to conformity certificates. Please list all the Saudi Arabian ministries, agencies, and departments that have responsibility for granting/approving/authorizing use of the halal mark in Saudi Arabia, and explain their specific responsibility in the halal certification and licensing process.

Answer The Saudi governmental athorities that have responsibility for granting/approving/authorizing use of the halal mark in Saudi Arabia are;

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1. Saudi Food and Drug Authority (SFDA). 2. The Saudi Standards, Metrology and Quality Organization (SASO).

Question 29 Please describe how halal standards and requirements are notified to the WTO TBT Committee, and whether Saudi ministries consider public comments on existing or proposed regulations.

Answer Saudi Arabia have notified all halal standards and regulation to the Secretariat of TBT committee throw diplomatic channel (TBT contact point in Saudi Arabia).

Question 30 Page 59, paragraph 3.116 The Secretariat Report mentions halal marking in the context of labeling, however the impact of halal certification requirements extends much further than labeling policies Please provide all of Saudi Arabia's technical standards for determining what is, and is not, halal.

Answer GSO 2055-1 (HALAL FOOD - Part 1General Requirements) GSO 993 (Animal Slaughtering Requirements According to Islamic Rules).

Question 31 Please describe how technical standards are developed and implemented.

Answer Technical standards are developed based on international standards.

Question 32 Please provide all requirements that imported food and agricultural products undergo to complete halal-related conformity

Answer Imported halal food products shall attach halal shipment certificate issued by recognized halal certification body.

Question 33 Please identify the list of products that require halal certification as an entry-requirement.

Answer based on the General Requirements of HALAL FOOD GSO-2055-1, Furthermore, Halal Center- SFDA updates Halal food products list periodically.

Question 34 Please provide additional information on certification requirements, including Saudi measures and a description of the process and criteria for certifying/approving/accrediting halal certification bodies that certify products as halal for the Saudi market.

Answer 34 - In order to accept halal certificate with imports of food, recognized halal certification body (HCB) shall issue Halal certificate. HCB Recognition Requirements: 1- Accreditation certificate based in GSO 2055-2 2- Acceptance certificate by SASO. 3- Recognized by Halal Center

Question 35 Page 62, paragraph 3.134 Saudi Arabia prohibits trading GM foods of animal origin, which are obtained by means of biotechnology. Please clarify how Saudi Arabia defines "means of biotechnology"?

Answer In vitro nucleic acid techniques, including recombinant deoxyribonucleic acid (DNA) and direct injection of nucleic acid into cells organelles, or Fusion of cells beyond the taxonomic family, that

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- 152 - overcome natural physiological reproductive or recombination barriers and that are not techniques used in traditional breeding and selection.

Question 36 Page 70, paragraph3.162 The Secretariat Report notes that Saudi Arabia is an observer to the WTO Agreement on Government Procurement (GPA). Does Saudi Arabia intend to begin negotiations on joining the GPA? If so, when?

Question 37 Page 70, paragraph 3.169 The Secretariat Report notes that under Saudi Arabia's new Government Tenders and Procurement Law (GTPL), preferences in government tenders should be given to SMEs, listed companies, and local content. Please elaborate on whether the law places any restrictions on preferences for SMEs based on the monetary value of the government tender.

Answer The law does not place any restrictions on preferences for SMEs based on the monetary value of the government tender.

Question 38 Are all government tenders for which the GTPL applies subject to preferences for SMEs?

Question 39 Page 70, paragraph 3.171 The Secretariat Report states, "Certain elements of the new GTPL, in particular the principles of fairness, transparency, and competitiveness, are applicable to commercial companies in which the State owns more than 51% of the share capital." If only certain elements are applicable, please provide additional information on which provisions of the new GTPL do not apply.

Answer The mentioned preferences related to the local content are still under consideration and not enforced to date.

Question 40 Page 71, paragraph 3.180 The Secretariat Report notes that under the new GTPL, domestically produced products will still qualify for a 10 percent price preference, which can be increased upon agreement between the Local Content and Government Procurement Authority (LCGPA) and the Center of Spending Efficiency (CSE). Has Saudi Arabia established a maximum limit that the price preference can be increased to with respect to domestically produced products?

Answer The New Government Tender and Procurement Law does not establish a maximum limit.

Question 41 Please explain the process by which LCGPA and the CSE would determine an increase in the price preference.

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Answer LCGPA and CES, along with other government entities, started conducting a study that covers various economic and trade elements, based on the outcomes of this study it will be decided whether or not the price preference will be increased.

Question 42 Page 73, paragraph 3.190 The Secretariat Report states that Saudi Arabia has been a member of WIPO since 1982 and is a party to the Berne Convention for the Protection of Literary and Artistic Works as well as to other IP treaties. Does Saudi Arabia have any plans to join the WIPO Internet Treaties (WIPO Copyright Treaty/WIPO Performances and Phonograms Treaty)?

Answer Saudi Arabia is studying possible accession to the WIPO Internet Treaties (i.e. the WCT and the WPPT) as well as to some other IP treaties.

Question 43 Page 74, paragraph 3.191 The Secretariat Report states that the "Board of Directors of the Saudi Intellectual Property Authority Decision No. 04/08/2019 of 04/09/1440H" amended the Implementing Regulations of the Copyright Law regarding the moral and economic rights of copyright holders. Please provide more information about how this Decision amended the copyright law and impacted the scope of protection afforded to copyright holders.

Answer The amendment to the executive regulations was mentioned, is a formal amendment only to replace the phrase (the Saudi Authority for Intellectual Property) in place of (the Ministry of Culture and Information) and to replace (the Board of Directors of SAIP) the place of (the Minister), and this amendment is an effect of the establishment of the body to which all intellectual property activities were transferred

Question 44 Page 74, paragraph 3.192 The Secretariat Report explains that the Regulations of Optional Copyrights Registration provides registration services for "architectural designs and computer software and applications" and that Article 3(3) of the Regulations allows for the expansion of these registration services to other types of copyrighted works as decided by SAIP's Chief Executive. Are there current plans to expand voluntary registration to other types of copyrighted works, and if so, to what works?

Answer Yes, there is a plan to expand voluntary registration to include other types of copyrighted works such as applied works, pictorial, graphic and sculptural works.

Question 45 Page 76, paragraph 3.205: The Secretariat Report states that "commercial courts with subject matter jurisdiction over all criminal and civil IP cases" have been established Please provide information on the number of criminal and civil IP cases that have been filed and decided by these courts, as well as the criminal penalties and civil damages that have been assessed for IP violations.

Answer The number of the IP cases were (99) in the last (2) years.

Question 46 Page 116, paragraph 4.143 According to the Secretariat Report, "Other regulatory changes during the review period were based on priorities outlined in Mission 2030 and the ICT Sector Strategy, and include establishing regulatory frameworks: (i) for cloud computing (including localization requirements for certain sensitive data) in 2019..." Please provide further detail on the types of data subject to localization requirements, what is the process for determining data must be localized, and whether there are measures planned or in place to ensure that any restrictions placed on cross-border data flows are necessary and proportional to the risks presented?

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Answer As per the regulatory framework for cloud computing there are no trade restrictions on cross-border data flows or localization requirements as long as national laws and regulations are met and do no constitute national security risk.

III. QUESTIONS REGARDING THE GOVERNMENT REPORT

Question 47 Page 13, paragraph 3.37: On November 1, 2005, Saudi Arabia confirmed in the Report of the Working Party on the Accession of the Kingdom of Saudi Arabia to the World Trade Organization (WT/ACC/SAU/61/261) that its Regulations for the Protection of Confidential Commercial Information "provided for protection of undisclosed test and other data submitted to obtain approval of a pharmaceutical or agricultural chemical against unfair commercial use for a minimum period of five years from the date of obtaining the approval including the establishment of the base price." Saudi Arabia clarified that "[a]ny subsequent application for marketing approval would not be granted a market authorization unless the applicant submitted its own data, meeting the same requirements applied to the initial applicant, or had the permission of the person initially submitting the data to rely on such data." Please explain the steps taken by Saudi Arabia to "protect undisclosed test and other data against unfair commercial use for a minimum period of five years from the date of obtaining the approval including the establishment of the base price".

Answer SFDA does not disclose any data submitted for registration of a product by any company (innovated company or generic company). Also, SFDA does not benefit from this data for any commercial use. Question 48 Is Saudi Arabia considering the establishment of an administrative body under the Saudi Authority for Intellectual Property (SAIP) with subject-matter experts who could more efficiently resolve intellectual property disputes?

Answer SAIP are studying the possibility of establishing an administrative body for disputes resolutions.

UNITED STATES - FOLLOW-UP QUESTIONS

Question 1 Follow-up to Question 2: • What is the estimated cost to authenticate the required documents mentioned in Saudi Arabia's response to the U.S. Question 2 of the Secretariat Report? • What is the average time for an Embassy or Consulate to provide such service? Must an exporter present documents for authentication in person or can this process be fulfilled electronically? • What is the third-party organization that provides this service? • Where does Saudi Arabia publish information regarding these requirements and steps to comply? • Saudi Arabia noted authentication requirements are in place for drugs, chemicals, medical devices, cosmetics, and raw materials for cosmetics. • Are these authentication requirements all imposed by SFDA, or are there other agencies that require such authentication for imports?

Answer Saudi Arabia publishes information regarding these requirements and steps to comply in the official website of SFDA under the clearance requirement and conditions of each product.

• Saudi Arabia noted authentication requirements are in place for drugs, chemicals, medical devices, cosmetics, and raw materials for cosmetics.

Yes, by the Chamber of Commerce from the country of origin or from the country issuing the invoice.

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• Are these authentication requirements all imposed by SFDA, or are there other agencies that require such authentication for imports?

Yes, for SFDA.

Question 2 Follow-up to Question 22: We understand that Saber is an electronic service that reflects the Saudi technical regulations. The United States and industry continue to have questions regarding the implementation of the program. Does Saudi Arabia intend to develop and implement clear and transparent guidelines regarding the application of the Saber platform?

Answer The Kingdom of Saudi Arabia has announced the launch of Saber electronic platform, which aims to automate registering and issuing conformity assessment certificates for consumer products before entering the Saudi market. Also, it aims at ensuring that products are free from defects that may affect the health and safety of the consumer. Saber's e-platform reflects SASO's vision to develop and activate the role of beneficiaries in the process of registering products and ensuring their conformity to standards and specifications before entering, and selling them in the Saudi market. The Kingdom of Saudi Arabia reiterates that Saber e-platform facilitated for beneficiaries, local suppliers and manufacturers, to access conformity assessment bodies accredited by SASO around the world for the purpose of inspecting products and issuing conformity assessment certificates electronically and easily. In addition, it aims at facilitating and accelerating procedures for the clearance of products in coordination with the Saudi Customs. Saber's e-platform was developed in accordance with the highest standards of efficiency. These standards of efficiency include expediting registering products, searching for certified conformity bodies, reducing the time taken for beneficiaries in the process of conforming products, and obtaining required certificates of conformity. It is worth mentioning that the Kingdom of Saudi Arabia held seminars inside and outside the Kingdom for beneficiaries in order to raise awareness about Saber e-platform including United States in cooperation with the U.S.-Saudi Business Council. Please visit the link below for more details regarding the User Guide: https://saber.sa/Home/UserGuide.

Question 3 Follow-up to Question 31: Please describe how Saudi Arabia develops technical standards, like conformity assessment requirements, when there are no international standards, particularly for halal marking or certification.

Answer All Saudi technical standards are based on international standards.

Question 4 Follow-up to Question 88: • Please share information about the current timeline for amending the copyright law. • Is SAIP planning to amend its copyright law to accede to the WIPO Internet Treaties? • What topics did the public consultations on the draft copyright law cover, and will there be additional consultations? • How does Saudi Arabia intend to treat related rights in the next law, as we understand these are currently addressed in implementing regulations? • What is the current status of the law of geographical indications?

Answer • The amendment of Copy right law, and GI law, are currently in the final stages of approval. • Copyright treaties (WCT&WPPT) are from the targeted copyright treaties to be analyzed by SAIP for proposing possible accession of Saudi Arabia to them. • Many opinions were received, and the public consultations phase was completed as part of the development phases of draft laws and regulations in Saudi Arabia. • The Related rights has already been mentioned in the provisions of the developed Copyright law, However, all the detailed provisions will be indicated in the regulations.

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I. Additional Questions Based on the Secretariat Report

Question 5 3.3.7 Intellectual property rights 3.3.7.2 Copyright and Related Rights Page 74, paragraph 3.191 • Please explain how folklore is protected under its copyright law, and how the rights of authors are preserved. Are there any cases involving folklore? • Please provide more detail surrounding exceptions to copyright in its law regarding the copying of broadcast works. • What is the scope of "current events", and would it include sporting events? • Please provide information about exceptions for taking new photographs of any previously photographed object or work and publishing the pictures.

Answer Folklore shall be the property of the state, and. When an author creates a work that contains folklore that is altered or modified, he/ she-before creation- should seek a license from the government. The copyright law does not specify the scope of current event. However, such act must be within the intended objective with the source clearly given. AS Stated in the Copyright Law, it is not considered an infringement when new photographs of any previously photographed object or work and publishing these pictures is taken, even if the new pictures have been taken from the same vantage point and under the same circumstances of said pictures

Question 6 3.3.7.3 Industrial Property Page 76, paragraph 3.202: The Secretariat Report states that "the Patent Office of the GCC grants patents that are valid in all GCC member States." However, the Gulf Cooperation Council Patent Office ("GCCPO") announced that as of January 6, 2021, it was no longer accepting new patent application filings. Does Saudi Arabia anticipate an increase in national filings as a result of this decision? If so, is the Saudi Authority for Intellectual Property (SAIP) taking any actions in preparation for an expected increase in national filings?

Answer Yes, the Saudi Authority for Intellectual Property has anticipated that the number of applications will be increased and it is prepared for such increase.

Question 7 Page 76, paragraph 3.205: The Secretariat Report states that a 2020 amendment to the Law of Commercial courts "provides the commercial courts with subject matter jurisdiction over all criminal and civil IP cases."

• Please share relevant statistics or findings that provide insight into the Commercial Courts' decisions concerning IP cases, for example, a summary of damages awarded in civil cases and/or the penalties imposed in criminal cases. • Please also share specific civil judiciary procedures for filing a trademark infringement case, a patent infringement case, and a copyright infringement case.

Answer Statistical data are not available.

Question 8 Page 76, paragraph 3.206: The Secretariat Report states, "Saudi Arabia launched the IP Respect Officer initiative, which aims to qualify and train employees in most government agencies to advise on all matters related to IP in terms of software usage and publications in the entity they represent." Please provide information on the trainings it provided to government agencies under the IP Respect Officer initiative.

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Answer There were many training programs that were held dedicated to IP Respect Officers and they were required to attend specialized courses provided by World Intellectual Property Organization (WIPO) and SAIP.

Question 9 Page 76, paragraph 3.207: The Secretariat Report states that Saudi Arabia established the National Committee for Enforcing Intellectual Property Rights. With regard to the National Committee for Enforcing Intellectual Property Rights, how often does the Committee meet, and, to date, has the Committee created any reports, findings, or plans for strengthening the IP Enforcement system?

Answer The Committee meets every two months and it aims to improve the work of the enforcement system and enhance efforts aimed at developing work methods and procedures, achieving harmony and coordinating efforts between government and private agencies, enforcing intellectual property rights, and upgrading them to a level benefitting the status of the Kingdom of Saudi Arabia. Objectives:

II. Additional Questions Based on the Government Report

Question 10 Page 13, paragraph 3.42: The Government Report states that SAIP is currently reviewing and amending its IP legislations and requesting public feedback on a number of draft new legislations.

• Please identify the specific IP legislations that SAIP is reviewing, and those it is amending, and provide timelines for when they will be completed. • Will all drafts be published for comment by the public?

Answer SAIP on 2020 requested public consultations in regard to the following: • The draft Law of Geographical indications. • The development of the Law of Patents, Layout Designs for Integrated Circuits, Plant Varieties and Industrial Designs. • The Regulations of Utility Models. • The Regulations for Licensing of IP agents. • The Regulations for the Protection of Confidential Commercial Information.

Recently, Saudi Arabia centralized public consultations at National Competitiveness Center (NCC) to be the authority responsible for the address of the public consultations.

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