Individuals holding at least 25% of a company’s ownership — directly or indirectly — will now be designated as the beneficial owner under the amended rules foridentifying the beneficial owner(pdf) approved by Commerce Minister Majid Al Qasabi. The updated rules set out a clearer structure for defining who holds effective control within companies and are designed to comply with international standards to curb money laundering, terrorism financing, and arms funding while building a unified database for beneficial ownership across the Kingdom, the ministry said on X.

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Under the new rules, if no individual meets this threshold, or if the ownership structure makes the designation unclear, the status shifts to whoever exercises effective and ultimate control over the company outside of capital ownership. When neither ownership nor control identifies a beneficial owner, the responsibility is assigned to the company’s manager, a board member, or the chairman, depending on the entity’s legal structure.

Listed joint-stock companies and their subsidiaries are exempt from the updated disclosure requirements, given that publicly traded firms already comply with more extensive reporting obligations under market regulations.

Compliance requirements: Companies must disclose their beneficial ownership data to the ministry within the first year of the rules coming into force. Violations are subject to penalties under corporate regulations, though the ministry clarified that no fees apply to filing or updating beneficial owner data.

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