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Date: 2016-08-12

Saudi Certificates

Q.  I\\'ve heard that Saudi Customs is stopping manufactured goods from entering the country if they lack a specific certificate. Is this new?  Is it legal?

A.  You may be referring to a certificate of conformity, which requires an independent testing of components and performance.  The Saudi regulation has been on the books for several years, but WPG has learned that enforcement began in earnest earlier this year.  So, yes, goods are being stopped if not accompanied by this certificate, which is in addition to a certificate of origin.

The practice is in compliance with WTO, though it\\'s less common to require testing and certification across such a large range of goods.  The intent is to protect Saudi consumers--and they\\'ve needed it.  With massive development projects during the last decade, the country has imported a vast array of goods.  Some of them have been spectacularly shoddy--breaking, catching fire, melting and in some cases injuring or killing their owner-operators.

The problematic goods mainly come from East Asian manufacturers, but the rules regulating their sale in the Kingdom need to apply to all sources.

Certificates of conformity are not inexpensive for the smaller enterprise.  Indeed, they can cost several thousands of dollars, and if the producer is selling a number of different kinds of products the money adds up quickly. The Saudi government stipulates the testing labs that can be used and there are many of them in the U.S. and in other countries the provide products for the Kingdom’s many consumer and industrial needs.

Mother of all spending sprees

The good news is that testing is only needed once.  Although now a necessary cost of doing business, what spectacular business there is to get done.  Saudi plans to spend over  $500 billion during the next few years on infrastructure projects such as new cities, medical complexes, railroads and renewable energy equipment.  With the price of oil sitting for a while at over $100 per barrel, the Saudi’s are flush with petro dollars.  They know the party can’t last forever, so they’ve embarked on an ambitious plan to modernize and diversify.

This means that they need consultants of every imaginable skill set.  Students with full scholarships are fanning across the English-speaking world in search of higher education.  Returning after their studies, they will become entrepreneurs and policy makers, more likely to do business with friends they’ve met while abroad.

Don’t believe what you learn from the mass media.  U.S.- Saudi ties remain strong, and contracts and contacts are increasing.  Imports are vital to the nation’s imagined future, which is under construction now.  Regulations can seem like a nuisance, but they often serve legitimate public purposes, and any costs to exporters arising from them are often fully tax deductible.

The market is simply too lucrative to allow nettlesome regulations to dissuade you from doing business there.


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