It is not mandatory for foreign pilgrims’ service providers to establish service companies

Monday, April 3, 2023

JEDDAH — The Ministry of Hajj and Umrah has made the finishing touches to the amendments in some articles of the Law of Service Providers for Foreign Pilgrims which is in line with the latest developments while contributing to improve the services provided to the pilgrims.

According to the draft amendment, a copy of which was obtained by Okaz/Saudi Gazette, it is not mandatory on the part of foreign pilgrims’ service providers to establish service providing companies, and this matter would be an optional one.

The draft amendments delete definitions related to the owners of tawafa organizations and names of companies.

The amendment included the deletion of the phrase that states: “Restructuring the tawafa organizations to transform from individual institutions into companies, through their capitalization and governance.”

The amendment also deletes the text that every tawafa organization and the United Establishment for Guides shall take the form of a joint-stock company.

According to the amendment, the initial public offering (IPO) of shares shall be after five years from the establishment of the companies and not from the date when the law comes into force.

The amendment also deleted the text: “The United Establishment for Agents and the United Establishment for Zamazama must take the form of a joint stock company to provide service to pilgrims.”

Companies are obligated to provide the service for the first three years from the date of their establishment in accordance with that specialization.

During the last two years they may expand their specialization, to include the provision of the service provided by any of the other companies.

The amendment included the penalties of suspension and cancelation of service of tawafa organizations in the event that they chose to practice the activity themselves.

The text of the following provision of the law was also amended: “In the event that any of the tawafa organizations and service-providing companies breach their obligations, the Ministry may take all necessary measures to ensure the provision of service to pilgrims, including assigning the duty to any other company, which is licensed to provide the service, and retrieving its value from the violating company.”