Abu Dhabi: Saudi Arabia has extended the grace period for business licensing fraud offenders to legalise their status toFebruary 16, local media reported.
The period provides multiple options for violators, whether Saudi or non-Saudi, by exempting those who apply to the Ministry of Trade to request rectification of their legal status from penalties and from paying income tax retroactively.
Dr. Majid Al Qasabi, Minister of Commerce, said the extension reflects the Kingdom’s keenness to provide the opportunity to more businesses to correct their legal status.
Al Qasabi added a number of large and medium-sized firms, whose annual revenues exceeded more than 6 billion riyals, have benefited from the amnesty so far.
Anyone arrested by the ministry for committing a crime or violating the anti-business licensing fraud law before submitting a request to rectify their situation, or whoever was referred to the Public Prosecution, or the competent court, is not exempt.
Violators of the anti-concealment system can rectify their legal status by submitting an application through the Ministry of Commerce website: mc.gov.sa.
Applicants will have several options, including: Introducing a new legal partner (Saudi or non-Saudi); selling, assigning or dissolving the business; transfering the ownership of the business to a non-Saudi after the latter obtains an investment license; a non-Saudi can apply for a distinct residence visa, or an investment license to continue business; or to apply for final exit.
Saudi Arabia has tightened penalties for business licensing fraud, also known as Tasattur, or cover-ups, in which foreign nationals owning businesses in the kingdom use the names of Saudi citizens.
A new anti-business licensing fraud regime passed by the Saudi Cabinet seeks to eliminate the shadow economy and includes tough penalties for offenders of up to five years in prison and a fine of up to SR5 million.
Protecting whistleblowers
The new anti-business fraud regime protects whistleblowers and rewards them up to 30 per cent of the fine collected after a final court ruling is issued.
The system stipulated proactive measures to prevent cover-ups by addressing the stages that preceded the crime, and punishments, the most important of which is the seizure and confiscation of the unlawful funds of the perpetrators.
The system enables the relevant government agencies to curb business licensing fraud, demanding that each entity that issues licenses to businesses follow up on them, and inform the Ministry of Commerce of any suspicious practices.
The new system authorises relevant entities to use technology to prove the crimes and violations of commercial concealment through “electronic evidence” in addition to other methods of proof.
The system also allows commuting or exempting from penalties for those who report any fraudulent activities.
