Tech companies are now at the center of Saudi Arabia's Vision 2030 priorities, as it aims to be the regional leader in AI, datacenters, IP development, and broader digital infrastructure.
Key to this vision is greater localization and domestic market participation by global technology companies - and the Kingdom is combining public procurement and onshoring programs to encourage substantive local presence.
Global technology companies need to pay close attention to the growing procurement opportunities alongside localization programs that affect bid eligibility, project economics, delivery models, and long-term market access.
Tech companies should assess procurement, localization, and operating structure together. Key topics include:
The RHQ program has become a critical prerequisite to engaging with the Saudi government at all levels. To participate in government tenders above SAR 1 million (c. USD 270,000), multinational companies must maintain their RHQ in Saudi Arabia. The program requires onshoring of substantive management operations, but includes parallel incentives, including favorable tax treatment, staffing benefits, and regulatory facilitation. Planning for an RHQ, and its implications on regional operations, is a key step in managing Saudi market participation.
The EPP is the region’s most significant onshoring program, and ties tender participation directly to market participation. To bid on government contracts above SAR 100 million (c. USD 27 million), foreign suppliers must separately provide a local investment proposal reflecting 35% of the prime contract’s value. The program identifies key areas of focus that receive “dollar multipliers” for calculating the value of the local investment, including R&D, technology transfer, and knowledge transfer. The program is a growing government priority, and while it is still in the early implementation phase, it must be taken into account in market entryplans.
The Saudi government is seeking to move away from older local partnership and joint-venture models. The new RHQ and EPP programs are designed to encourage multinationals to directly participate locally. Companies must evaluate whether current partnership or JV models fully meet the new onshoring requirements.
As Saudi Arabia continues to invest heavily in these sectors, tech companies should expect increased scrutiny of their local footprint, contribution to the Saudi economy, workforce development, and localization efforts.
This requires proactive assessment of Saudi bid pipelines, RHQ status, potential EPP exposure, localization options, and technology-transfer risk allocation before a live procurement.
Tech companies should consider whether they bid, or intend to bid, for Saudi government or government-related contracts and be ready to identify realistic localization initiatives. They should also assess local capability building, training, technical support, technology transfer, RHQ arrangements, and the impact of localization commitments on pricing, delivery, and profitability.
We understand how early assessment of procurement eligibility, localization plans, and operating structure can reduce execution risk and improve tender readiness.
Our clients rely on us to help design and implement their entire Saudi market entry strategy, including focused Saudi procurement and localization readiness reviews, RHQ compliance assessments, potential EPP exposure, localization options, and practical strategies for future government opportunities.
We work in tandem with our Saudi partner-firm, MZ Lawyers, to combine global tech-sector experience, regional government relations and regulatory expertise, and on-the-ground knowledge to ensure our clients are ready for the new opportunities in the Kingdom.
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Technology Sector
(International and Cross-Border)
Privacy & Data Security: The Elite
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Government Contracts: The Elite
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