The Council of Ministers recently approved the Privatization Bill, which enables foreign investors to rent real estate within the holy cities of Makkah and Madinah.

The leasehold property will be for a term equal to the length of the contract between the investor and one of the executive authorities and will be used to carry out a privatization project.

The most important requirement is that developers use the property solely to carry out a privatization project while following all of the contract's instructions.

The law stated that if the investor breaches any of the agreed-upon terms, he will first be instructed by the executive authority to remedy the violation, and if the violation is not corrected within the prescribed time, the lease contract with him will be terminated.

Private establishments that have signed a privatization contract are not allowed to delegate the partnership contract in whole or in part to third parties until they first receive written approval from the executive authority.

It is possible to delegate any of the works relevant to the public-private partnership (PPP) project to others, as long as the main contract holder does not violate his or her responsibilities and is directly accountable to the executive authority. Even if their actions have affected or restricted competition, the private sector establishments that signed the contract would not be listed as monopolistic if their acts are deemed a contribution.

The law stipulates that the duration of a public-private partnership contract cannot exceed 30 years from the date of signature. If the term of partnership between the two parties expires and the project is re-offered and awarded to the same party, the terminated contract is not considered a continuation or expansion of the previous one.