Unlocking Job Opportunities for Saudis by Combating Commercial Concealment

In Saudi Arabia’s ongoing journey toward economic diversification and labor market reform, one major obstacle has been the persistent issue of commercial concealment (tasattur). This illegal practice, where foreign nationals covertly operate businesses in the name of Saudi citizens, has long distorted the job market and limited opportunities for Saudi nationals. In response, the Saudi Ministry of Commerce has launched a series of targeted reforms designed to eliminate commercial concealment and unlock meaningful employment and entrepreneurial paths for citizens.

The Legal and Strategic Response

The Ministry of Commerce introduced a comprehensive Anti-Concealment Law in 2020 to address this issue systematically. This law not only imposed stricter penalties—including up to five years’ imprisonment and SAR 5 million in fines—but also empowered authorities to confiscate illegal revenues and shut down illicit businesses. Crucially, it holds both the Saudi and the non-Saudi parties accountable for concealment practices.

To modernize enforcement, the Ministry has employed cutting-edge technologies such as AI and big data analytics. These tools help detect irregular financial activities, mismatches in business registrations, and ownership structures that suggest concealment. This digital transformation has allowed for more proactive and transparent enforcement, reducing the number of informal or hidden businesses.

National Program and Corrective Measures

The creation of the National Program to Combat Commercial Concealment has further centralized and coordinated government efforts. This multi-agency initiative includes the Ministry of Commerce, the Zakat, Tax and Customs Authority (ZATCA), the Ministry of Human Resources and Social Development, and others. Together, they conduct inspections, audit financial records, and ensure compliance with Saudization policies.

One notable initiative was the corrective period launched between 2021 and 2022, during which businesses engaged in concealment were given a chance to legalize their operations. Over 20,000 businesses took advantage of this amnesty period, either by transferring ownership to Saudis, obtaining proper investment licenses, or exiting the market. This not only increased the transparency of commercial activity but also opened up space for Saudi entrepreneurs and job seekers.

Indicators of Success and Market Transformation

There are clear signs that these reforms are making a tangible impact:

• More than 1,200 tasattur cases were referred to the Public Prosecution in 2023 alone.

• Over 20,000 businesses corrected their legal status during the grace period.

• Joint inspections across agencies exceeded 50,000 in recent years.

• The Saudi Business Center has recorded a rise in new commercial registrations by Saudi nationals, especially in sectors previously dominated by expatriates.

• Public reporting and whistleblower engagement have surged, thanks to awareness campaigns and a reward system offering up to 30% of fines collected.

These figures highlight not just enforcement success but also the beginning of a broader cultural shift in the Saudi private sector—toward legal compliance, transparency, and genuine opportunity.

Previously Expat-Dominated Sectors

Several sectors were historically dominated by expatriate labor and concealed foreign ownership due to low barriers to entry and limited interest from local workers. These include:

• Retail and Wholesale Trade: Small grocery stores, electronics shops, and mobile phone outlets were often run by foreigners under Saudi names.

• Construction: Labor-intensive work such as plumbing, masonry, and electrical services saw widespread informal employment.

• Food and Beverage: Restaurants, cafés, and catering businesses frequently operated under tasattur arrangements.

• Automotive Services: Car repair garages and used auto dealerships were typically managed by expatriates.

• Cleaning and Maintenance: Services such as housekeeping, pest control, and building maintenance were largely expatriate-run.

• Real Estate and Contracting: Informal brokers and subcontractors dominated this space.

• Personal Care Services: Barbershops, salons, and tailoring services were often expatriate-managed.

• Small-Scale Consultancy: Unlicensed accounting, tax filing, and legal advisory services were prevalent.

These sectors, once largely closed off to Saudis due to entrenched concealment practices, are now undergoing transformation. As illegal operations are shut down or legalized, new opportunities arise for Saudi nationals to step into roles as business owners, managers, and skilled service providers.

Strategic Implications for Saudi Vision 2030

The crackdown on commercial concealment is more than a legal or regulatory initiative—it is a cornerstone of Vision 2030’s broader goals. By reclaiming sectors of the economy previously obscured by illegal practices, the government is fostering a more inclusive, competitive, and transparent private sector. These reforms not only encourage Saudi participation in the workforce but also nurture a new generation of entrepreneurs.

Furthermore, the alignment of anti-concealment efforts with Saudization programs ensures that job creation is real and impactful. It prevents the phenomenon of phantom jobs created merely for compliance and instead redirects employment and ownership opportunities to where they are most needed.

Conclusion

Saudi Arabia’s fight against commercial concealment is unlocking vast economic potential. Through strict laws, technological innovation, interagency coordination, and public engagement, the Ministry of Commerce is laying the groundwork for a more dynamic, transparent, and Saudi-led private sector. As reforms continue to gain momentum, they will not only level the playing field but also empower citizens to take charge of their economic future—turning hidden challenges into visible opportunities.