Transferring the Sponsorship of the Labor, Reporting a Commercial Concealment Case, without the Consent of his Sponsor, as Announced by MCI & Ministry of Labor

15 May 2016
​The Ministries of Commerce & investment, Labor & Social Development confirmed that the labor, who reports a commercial concealment case, would be allowed to transfer his sponsorship to another employer without the consent of his sponsor, provided that evidences should be presented and the informant is not sharing in such concealment. This reflects the cooperation and keenness of the two ministries on combating the commercial concealment and finding a regular trading environment, free of any violations, and to enable the citizens of exercising business safely.
It is worth mentioning that article 15 of the Implementing Regulations of Labor Law, recently adopted, stipulates that "The Minister, or his authorized representative, is allowed to give approval for transferring the sponsorship of a labor without the consent of his employer, in the event the labor would report a commercial concealment case against the employer, provided that the labor should present substantiated evidences and he is not sharing in such concealment”.
The two ministries call on citizens and residents to cooperate in this field to reduce and combat the commercial concealment phenomenon, by reporting their complaints and observations through the toll free number of MCI "1900" or through the application of a commercial notification, or through the call center of the Ministry of Labor No. 19911, as well as through contacting the two ministries via their accounts in the social networking websites.
Meanwhile, the two ministries renewed their warning to companies, institutions and individuals to avoid cooperating, dealing or aiding the violators of the Kingdom`s Rules & Regulations regarding the investment and labor law. Otherwise, they would be liable to legal questioning and penalties, which may lead to defamation, two years' imprisonment, a fine of up to one million riyals for each violator and deporting the non-Saudis from the Kingdom.
The Commercial Concealment is defined when the non-Saudi practices a business for his own account, with the support and empowerment of a Saudi citizen or a foreign investor, whether through using the citizen`s name, license, commercial registration, or in any other way. This is a clear violation of the R&R of the Kingdom, where the first article of the Anti-Commercial Concealment Law stipulates that it is not permissible for the non-Saudi, in any case, to exercise or invest in any trade activity, he is not authorized or licensed to exercise or invest in. This is in accordance with the Foreign Investment Law and the relevant Rules, Regulations and decisions.

Last Modified 26 Dec 2018