Article 3 of the Saudi General Warehouses Law
المادة 3 من نظام الإيداع في المخازن العامة
The article provides that the preliminary license to establish a general warehouse is issued by the city's amanah or municipality, and the license to carry on the activity by the Minister of Commerce or his delegate, under the Implementing Regulations' rules.
Official text (Arabic)
This article has not been amended since the law was issued.
مع عدم الإخلال بالأحكام الواردة في الأنظمة الأخرى، يصدر الترخيص المبدئي بإنشاء المخزن العام أمانة أو بلدية المدينة التي سيقام فيها المخزن. ويصدر الترخيص بمزاولة النشاط وزير التجارة أو من يفوضه من مديري فروع وزارة التجارة وفقا للضوابط التي تحددها اللائحة التنفيذية .
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 3 explained in plain English
This article sets out two types of license required for a general warehouse, each from a different body:
- The preliminary license to establish the general warehouse: issued by the amanah or municipality of the city where the warehouse will be located.
- The license to carry on the activity: issued by the Minister of Commerce or whoever he delegates among the directors of the Ministry of Commerce's branches, in accordance with the rules set by the Implementing Regulations.
The first concerns establishing the premises, and the second concerns carrying on the activity of the general warehouse itself. The article does not state the conditions or documents for either license, but for the license to carry on the activity it refers to the rules in the Implementing Regulations.
The article begins with the phrase "without prejudice to the provisions of other laws", which means these licenses do not replace anything that other laws may require.
A general warehouse, as Article 2 defines it, is the place the warehouse keeper designates for depositing and keeping goods for a fixed period until they are delivered, in return for a known fee. Article 4 then places restrictions on the warehouse keeper's activity after licensing: it bars him from engaging in commercial activity or speculating in goods of the type he is licensed to keep, with an exception for state-owned companies where the public interest requires.
Anyone wishing to establish a general warehouse is best advised to contact the two bodies named, and may consult a lawyer specializing in commercial matters.
Practical example
A company in Dammam wants to set up a general warehouse to keep merchants' goods for a fee. Under this article, it first obtains a preliminary establishment license from the amanah of the Eastern Province or the city municipality, and then a license to carry on the activity from the Minister of Commerce or his delegate among the directors of the Ministry's branches, under the rules of the Implementing Regulations.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 3 of the Saudi General Warehouses Law
Who issues the license to establish a general warehouse?
The preliminary license to establish the general warehouse is issued by the amanah or municipality of the city where the warehouse will be located.
Who issues the license to carry on a general warehouse's activity?
The Minister of Commerce, or whoever he delegates among the directors of the Ministry of Commerce's branches, in accordance with the rules set by the Implementing Regulations.
Is a municipality license enough to operate a general warehouse?
No. The article distinguishes between the preliminary establishment license from the amanah or municipality and the license to carry on the activity from the Minister of Commerce or his delegate.
More articles on General Warehouse Licensing
- Article 1
The article states the Law's purpose: setting rules for the work of the general warehouse, clarifying the nature of the goods stored, and defining the warehouse's rights and obligations and the storage fee.
يهدف النظام إلى وضع ضوابط تنظم العمل في المخزن العام ، وتوضح طبيعة البضاعة التي يتم تخزينها وحفظها، وتحدد حقوق والتزامات المخزن وأجرة التخزين.
- Article 2
The article defines the Law's key terms: the general warehouse, deposit in warehouses, the storage receipt and the pledge document.
يقصد بالألفاظ والعبارات الآتية ـ أينما وردت في هذا النظام ـ المعاني المبينة أمامها ما لم يقتض السياق خلاف ذلك : المخزن العام : هو المكان الذي يخصصه الخازن لإيدا
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.