Saudi Arabia announced the establishment of a Special Economic Zone (SEZ), the first special zone of its kind in the world. The zone, to be located at King Khalid International Airport in Riyadh, will focus on integrated logistics and will enjoy special rules and regulations aimed at attracting more multinational companies to the country.

A Royal Order was issued on 19 October 2018 to approve the regulation of the “Integrated Logistics Bonded Zone – ILBZ” and has assigned its establishment and operation to the General Authority for Civil Aviation (GACA) as the Zone Governing Body, while the Saudi Arabian General Investment Authority (SAGIA) will oversee attracting investment. ILBZ is a major step in translating Vision 2030 into action by leveraging Saudi Arabia’s strategic location as the hub connecting three continents, one of three core pillars of the Saudi Vision announced in 2016.

The establishment of ILBZ is part of a broad plan to establish special economic zones in competitive locations for promising sectors, including Information and Communications Technology, logistics, tourism, industrial and financial services. These zones will leverage the unique advantages of Saudi Arabia’s location within less than seven hours’ distance from a vast number of consumers in Europe, Asia, the Middle East and North Africa, as well as its strong and growing transportation and logistics infrastructure.

The ILBZ offerings are tailored for multinational companies, supporting a wide range of activities, including warehousing and fulfillment, inventory management, maintenance and repairs, staging, testing, and assembly. By serving as a unified hub in which companies can engage in these activities and access a vast network of transportation corridors by air, land and sea, the ILBZ is expected to enable Saudi Arabia to become a regional and eventually a global logistics hub, playing an increasingly central role in world trade.

Further details as to its functionality etc. will be shared as soon as announced.

For additional information with respect to this Alert, please contact the following:

Ernst & Young & Co (Public Accountants), Saudi Arabia Tax Leader, Riyadh

• Asim J. Sheikh | asim.sheikh@sa.ey.com

Ernst & Young & Co (Public Accountants), Riyadh

• Abbet R Barce | abbet.barce@sa.ey.com
• Ahmed Abdullah | ahmed.abdullah@sa.ey.com
• Amr Farouk | amr.farouk@sa.ey.com
• Altaf Sarangi | altaf.sarangi@sa.ey.com
• Hosam Abdulkareem | hosam.abdulkareem@sa.ey.com
• Imran Iqbal | imran.iqbal@sa.ey.com
• Michael Hendroff | michael.hendroff@ae.ey.com
• Mirza Ashraf | mirza.ashraf@sa.ey.com
• Nitesh Jain | nitesh.jain@sa.ey.com
• Parvez Maqbool | parvez.maqbool@sa.ey.com
• Sohail Nini | sohail.nini@sa.ey.com
• Stuart Halstead | stuart.halstead@sa.ey.com
• Suleiman Mohammed | suleiman.mohammed@sa.ey.com
• Vladimir A. Gidirim | vladimir.gidirim@sa.ey.com
• Yousef Eldaw | yousef.eldaw@sa.ey.com

Ernst & Young & Co (Public Accountants), Jeddah

• Franz-Josef Epping | franz-josef.epping@sa.ey.com
• Ayman Abu El Izz | ayman.abueIzz@sa.ey.com
• Hanif Khatri | hanif.khatri@sa.ey.com
• Hussain Asiri | hussain.asiri@sa.ey.com
• Imran Ahmed | imran.ahmed@sa.ey.com
• Irfan Alladin | irfan.alladin@sa.ey.com
• Mohammed Desin | mohammed.desin@sa.ey.com

Ernst & Young & Co (Public Accountants), Al-Khobar

• Syed Farhan Zubair | farhan.zubair@sa.ey.com
• Ali Sainudheen | ali.sainudheen@sa.ey.com
• Bilal Mian | bilal.mian@sa.ey.com
• Hatem Ghobara | hatem.ghobara@sa.ey.com
• Javed Aziz Khan | javed.aziz@sa.ey.com
• Jude deSequeira | jude.desequeira@sa.ey.com
• Sanjeev Fernandez | sanjeev.fernandez@sa.ey.com

Ernst & Young LLP, Middle East Tax Desk, Houston

• Gareth Lewis | gareth.lewis1@ey.com 

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