Riyadh - Sharikat Mubasher: Global technology giants Google, Microsoft, and Amazon.com are poised to open their regional headquarters in Saudi Arabia, in alignment with the Kingdom’s Regional Headquarters (RHQ) Program that entered into effect on 1 January 2024.

The three giants, along with other firms including Airbus, Oracle, and Pfizer, have all obtained licenses to establish regional headquarters in Riyadh, as reported by Bloomberg.

The Kingdom announced several exceptions to the RHQ Program, including contracts below SAR 1 million, contracts executed outside of the kingdom, deals with firms that are the sole providers of their service or commodity, and emergencies that can only be addressed by a foreign firm without regional headquarters.

According to the program, having a regional headquarters in the Kingdom is a prerequisite requirement for foreign firms to start or expand their businesses in Saudi Arabia.

Firms without regional headquarters can still compete for government tenders, but government agencies will only be able to approve them if they are technically superior and 25% cheaper than the next best offer, or if there are no competing offers.

Last December, the Saudi government added a 30-year tax relief incentive package to the RHQ Program to streamline the process for multinational companies establishing their RHQ in the Kingdom.

The incentive package included a 0% rate for corporate income tax (CIT), withholding tax (WHT) on dividend payments from RHQ to its foreign parent entity, WHT for payments to related parties, and WHT for services payments to non-resident unrelated parties necessary to carry out RHQ activities as defined in the tax rules.