Saudi Central Bank allowed to buy properties to diversify its foreign investments

The new law also prevents the bank from engaging in trade or participating in commercial activities or taking interest in any commercial, industrial or agricultural projects

  
A view of the city of Riyadh in Saudi Arabia, December 18, 2017. Image used for illustrative purpose.

A view of the city of Riyadh in Saudi Arabia, December 18, 2017. Image used for illustrative purpose.

REUTERS/Faisal Al Nasser

RIYADH — The Law of the Saudi Central Bank allowed the bank to buy or own real estate if the purpose was to diversify its foreign investments, Okaz/Saudi Gazette has learnt from sources.

The new law also prevents the bank from engaging in trade or participating in commercial activities or taking interest in any commercial, industrial or agricultural projects. However, this law comes with an exception with regard to what was necessary to achieve the bank’s objectives.

According to the law, the Central Bank is prohibited from financing or lending to the government or to any individuals. But there is an exemption provided in the case of financial institutions for the purpose of managing their liquidity or during crises.

The Central Bank’s assets, revenues, and properties enjoy immunity. They should not be subjected to raid, seizure, confiscation, possession, or expropriation, and they are not subject to bankruptcy procedures in any form.

The Central Bank will not be subjected to the provisions of the Competition and Government Procurement Law. But it will be subjected to the regulations and policies issued by the Board, provided that the regulations and policies are consistent with the objectives and basic principles of the Competition Law.

The bank’s contracts and agreements will be subject to the policies approved by the Board, with the exception of some cases where contracts and agreements are related to foreign laws if the rulings establish that they are subject to the jurisdiction of foreign courts.

 

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