In a strategic move aimed at restructuring the travel and tourism market in Saudi Arabia, the Ministry of Tourism has unveiled a draft comprehensive amendment to the "Travel and Tourism Services Regulations." These amendments aim to solidify the principles of transparency and protect the rights of beneficiaries, including a precise classification of licenses and the imposition of stringent financial guarantees of up to two million riyals to ensure the financial solvency of service providers.
The context of tourism transformation and Vision 2030
These amendments are particularly important given the significant developments in the Saudi tourism sector, driven by the goals of Vision 2030, which aims to establish the Kingdom as a leading global tourist destination. With the target of attracting over 100 million visits annually, it has become essential to develop the legislative environment for the travel sector to ensure a safe and reliable tourism experience that meets international standards. This necessitates eliminating unregulated practices and enhancing the confidence of both domestic and international tourists in the services provided.
Financial guarantees and immediate compensation
The most significant aspect of the new draft is the requirement for license applicants to provide a financial guarantee or insurance policy not exceeding two million Saudi riyals . This guarantee is not merely a routine procedure; it serves as a safeguard to ensure the tourist's financial rights and any imposed fines are settled. The regulations stipulate, with unprecedented rigor, that the tourist's financial rights must be recovered from this guarantee within just 24 hours of the licensee being notified, thus eliminating the frustration of delays in reimbursement.
Consumer protection and quality standards
The ministry placed the tourist at the heart of its concerns through precise compensation criteria:
- Service interruption: In the event of a disruption to basic services (such as electricity and water) for more than two hours, the tourist has the option of either getting a refund or receiving an alternative unit.
- Booking failed: The service provider is obligated to provide an alternative of equal or higher standard, or to refund the amount immediately without any deduction.
- Financial refunds: Refunds must be completed within a maximum of 15 days if the service is not provided, and deducting any amounts from credit cards without prior agreement is prohibited.
Regulation of licenses and fees
The regulations prohibit engaging in any tourism activity without a valid license and divide licenses into two categories: "Travel and Tourism Agency" and "General Travel and Tourism Services." They also established a new fee structure, setting the fee for a "General Travel and Tourism Services" license for five years at 28,000 riyals, while the fee for a "Travel and Tourism Agency" license for the same period is 14,000 riyals.
Human resource development and professional discipline
To ensure operational efficiency, the draft imposed strict qualification requirements:
- Saudi managers are required to have a bachelor's degree with one year of experience, or a diploma with two years of experience.
- A minimum of 7 years of experience is required for expatriate workers in highly skilled professions.
- Provide a licensed tour guide for every 25 tourists as a minimum.
- Companies are required to respond to complaints around the clock and to use both Arabic and English.
This regulation is expected to help clean up the market from intruders and irregular entities, thereby enhancing the competitiveness of compliant companies and raising the quality of the Saudi tourism product at the regional and international levels.
