Free zones become the new frontier of the Saudi–UAE feud AS FEATURED ON fDi Intelligence – Aug 13, 2021

New rules of origin likely to be start of further announcements as UAE and Saudi Arabia diversify away from oil and gas

Saudi Arabia’s announcement in June regarding rules of origin on imports from other Gulf Cooperation Council countries has raised the stakes within the region, as it goes head-to-head with the UAE in competing for the position as the region’s trading and business hub.

The country introduced further caveats regarding the ability to claim a local national origin — most notably a nationalisation rate of at least 25% — which is vital for imported goods to enjoy a discounted rate (usually 0%). Further, and potentially more importantly for those with businesses in the UAE, goods leaving from a free zone will no longer be considered locally produced, and are therefore ineligible for the tariff reduction.

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