Saudi Arabia's tourism authorities look to new regulations to improve standards and build capacity

Despite playing host to a plethora of natural and cultural attractions, the Kingdom’s tourism sector remains relatively under-developed and is largely limited to the religious pilgrim market centred on Makkah and Medina. The legacy of this under-development is particularly felt in the regulation of the sector. The Kingdom’s regulatory body, the Saudi Commission for Tourism and Antiquities (SCTA), was established as recently as 2000. Moreover, for the first 15 years of its existence the SCTA has been working within a legislative framework from 1975 (the Royal Decree on Hotel Regulations).

New Legislation

Although the SCTA has made significant advances over the past decade in terms of the organisation of the sector, the authorities nonetheless considered it time for an overhaul of legislation. As such, in January 2015 the SCTA received Cabinet approval for a new set of tourism regulations, which aims to streamline services and facilities related to the sector, as well as guide future development.

The new framework greatly expands the supervisory scope of the SCTA, and should play a significant role in raising standards and building capacity in the Saudi tourism sector. For instance, new rules will enable the SCTA to lay down criteria to regulate, develop and support tourism events across a wide range of sectors, including marine, agricultural, health, medical, business and wildlife tourism. Furthermore, the SCTA will also be able to set standards for published material relating to tourism (both printed and electronic).

Regarding tourism-related businesses, the new framework stipulates a licensing framework for companies involved in a variety of services, including accommodation, guided tours and travel agencies, while institutions involved in training for the hospitality sector will be obliged to follow standards established by the SCTA. In addition, tourism companies will be required to register details of their employees every three months.

Professional Bodies

As well as regulating tourism-related businesses, the SCTA is also hoping to improve coordination in the sector through the establishment of three professional societies. The Saudi Accommodation Association (for hoteliers), the Saudi Tourist Guide Association (for guides), and the Saudi Travel and Tourism Association (for operators) were all established in May 2014 by the Council of Ministers; their inclusion in regulations provides these bodies with a statutory basis. The new professional bodies are expected to help drive up standards in their respective fields, and take over some of the monitoring functions currently performed by the SCTA. The authorities also hope the professional bodies will take on a role in the future development of the sector. Speaking to local press at the inauguration of the associations, Prince Abdullah bin Saud bin Mohammed Al Saud, chairman of the Travel and Tourism Association, said, “The establishment of these associations will contribute to the implementation of many of the future projects that are expected to enhance tourism activity across the Kingdom.”

The associations will be helped in this task by powers granted to the SCTA through the new framework. According to the new law, general tourism locations such as beaches will become protected sites under government ownership, which the state may either directly develop itself, or lease to private sector partners for development following SCTA-mandated criteria. Such powers should give a boost to investment in new tourism developments, and provide a legal framework for public-private partnerships in the sector.

While the new framework significantly advances the SCTA’s scope, it fell short of media anticipation regarding tourist visas. As it stands, there is no mechanism for foreign visitors to enter the Kingdom for general tourism purposes. For several years it has been rumoured that the authorities are on the verge of introducing a tourist visa. Indeed, local media reported in December 2014 that the SCTA was in the process of doing so. Yet the commission was quick to issue an official denial, stating, “There is no intention at the moment to issue this kind of visa.” Rather, the authorities’ strategy is to focus first on developing the domestic market.