Local Content

Local Content Services

Importance of Local Content:
The concept of local content plays a major role in developing non-oil sectors and GDP, attracting special attention from the government.

  • Local content certificate became mandatory for benefiting from national product preference from May 1, 2023, for sectors:
    • Medical supplies
    • Chemicals and fertilizers
    • Furniture
  • From September 1, 2023, the certificate will also be required for sectors:
    • Construction
    • Cleaning consumables
    • Equipment and personal/home supplies

Definition of Local Content

Local content is the total expenditure in Saudi Arabia through the participation of Saudi elements in:

  • Workforce
  • Goods and services
  • Productive and technical assets

Simplified Objective: Preserve as much spending as possible within the Kingdom by government, private entities, or individuals.

Local Content Elements:

  • Assets: Sources and components of goods for local production chains
  • Workforce: Labor involved in producing local products or providing local services
  • Goods and Services: Local components used in producing goods or services
  • Technology: Research and development and training of Saudi workforce

Impact: Enhances Saudi Arabia’s economic competitiveness and develops local capacities to compete globally.

Mechanisms of Local Content Preference:

Mechanisms defined in the local content and SME preference regulation within the new government procurement system, giving preference to national products, local content, SMEs, and listed companies. Mechanisms include:

  • Price preference
  • Mandatory list
  • Weight of local content in financial valuation
  • Minimum local content requirement

Our Office and Its Role:

Our office, accredited by the authority, verifies local content ratios through:

  • Inspecting and auditing baseline models
  • Adhering to procedures approved by the Local Content and Government Procurement Authority