|09 September, 2019

Procedures for compensating contracting firms in Saudi Arabia soon

Saudi SEC expects that the ministry will soon make announcement with regard to receiving applications from the contracting companies pertaining to the payment of their dues

Image used for illustrative purpose. Asian Labourers work at the construction site of a building in Riyadh, Saudi Arabia August 4, 2016.

Image used for illustrative purpose. Asian Labourers work at the construction site of a building in Riyadh, Saudi Arabia August 4, 2016.

REUTERS/Faisal Al Nasser

DAMMAM — The Saudi Council of Engineers (SCE) will be holding discussions with Ministry of Finance officials to work out a fair mechanism for the payment of compensation to construction companies during the coming period, according to Osama Al-Afaliq, chairman of SCE.

“The council has come up with a number of proposals on the mechanism of disbursement of the compensation. SEC expects that the ministry will soon make announcement with regard to receiving applications from the contracting companies pertaining to the payment of their dues,” he said.

Speaking to Okaz/Saudi Gazette, Al-Afaliq said that a separate online platform will be set up to receive compensation claims from these companies, through which they can submit the necessary data to obtain the financial compensation.

He stressed the need to establish an appropriate mechanism to achieve minimum compensation for the affected companies. The increasing cost of raw materials or rising labor wages incurred financial burden on several contracting companies and that negatively affected their financial obligations. An appropriate mechanism for disbursement of compensation should take into account a number of direct and indirect effects that incurred losses to the companies, Al-Afaliq added.

 

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