In a regulatory move aimed at enhancing transparency and protecting consumers, the Saudi Ministry of Commerce announced significant updates to the executive regulations of the Precious Metals and Gemstones Law. These amendments, which include six key changes, are designed to keep pace with the Kingdom's economic and technological advancements and align with the goals of Vision 2030, which seeks to diversify the economy and improve the business environment.
Context of the updates: Vision 2030 and market regulation
The gold and jewelry market in Saudi Arabia has long been one of the largest and most active in the Middle East, given its cultural and economic significance. With the launch of Vision 2030, the Kingdom has embarked on a comprehensive modernization of regulations and legislation across various sectors, aiming to enhance market efficiency, attract investment, and bolster the confidence of both consumers and investors. This new regulation falls within this framework, seeking to address previous regulatory gaps and implement global best practices in this vital sector.
The 6 most significant changes to the precious metals list
The Ministry of Commerce identified the main differences between the new and previous regulations in six key points, which will reshape the market landscape:
- Expanding Sales Channels: A key change is allowing the sale of gold and precious metals through vending machines, in addition to traditional retail outlets. This represents a significant shift, embracing technology to facilitate access to gold bullion and investment products. While not entirely new globally, having first appeared in cities like Abu Dhabi, it is now officially entering the Saudi market to promote flexibility and innovation.
- Gemstone transparency: The new regulation mandates that any item containing diamonds or gemstones must be accompanied by a detailed identification card specifying the type and characteristics of the stone. Previously, this was not required, but it now increases transparency and protects consumers from fraud.
- Accuracy of Weight and Disclosure: It is now mandatory to disclose any increase in the weight of a precious metal item caused by set stones, however small. The previous regulation only required disclosure if the stones exceeded 5% of the total weight; this change enhances the accuracy of the information provided to the buyer.
- A comprehensive rights invoice: The invoice contents have been expanded to clearly include "maintenance and warranty terms" and a clear exchange and return policy, along with product and facility details. This ensures consumer rights after purchase.
- Regulating purchases from consumers: The new regulations require the issuance of an invoice when purchasing gold from a consumer, including their personal information. This measure aims to regulate purchases and increase oversight to combat the sale of stolen goods and money laundering.
- Strict advertising regulations: The new regulations prohibit advertising products without providing essential details such as type, weight, caliber, price, and purity standards. This puts an end to misleading advertising and ensures consumers have complete information before making a purchase decision.
Importance and expected impact
These changes are expected to have a multifaceted positive impact. Domestically, they will increase consumer confidence in the market, reduce commercial disputes, and encourage fair competition. Regionally, this move reinforces the Kingdom's position as a leading commercial hub that adopts advanced regulatory standards, potentially encouraging other countries in the region to take similar steps. Internationally, this regulation contributes to aligning the Saudi market with global best practices, making it more attractive to foreign brands and investments.
