Oil giant Saudi Arabia has started enforcing a ban on bidding for government projects by contractors who are not rated or registered in the Gulf Kingdom, a local newspaper reported on Sunday. 

The cabinet approved the bank in 2020 and said it would be enforced in 2021 to allow all contractors to adjust to the new regulations. 

“The higher authorities in the Kingdom has issued approval for the cabinet decision banning any unrated or unregistered contracting firm from bidding for government projects in the country as part of a plan to regulate the Saudi contracting market and tackle the problem of stalled and faltering projects due to long delays,” the Saudi Arabic language daily Al-Madina said, citing official sources. 

All small, medium and large firms would be rated by the Municipal, Rural and Housing Minister as per each company’s financial and technical resources, the paper said. 

Companies awarded one project must all be rated by the government and registered with the Saudi Contractors’ Authority (SCA), it said. 

“Government inspectors will  make visits to project sites to ensure compliance by the new regulations...offenders will face stiff penalties including cancellation of rating and a ban on new rating for 5 years,” it added. 

More than 140,000 contracting companies, mainly small, medium and family firms, operate in the Gulf Kingdom but a fraction of them are rated or registered. 

(Writing by Nadim Kawach; Editing by Anoop Menon)

(anoop.menon@refinitiv.com) 

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