Saudi Arabia’s Expropriation Law takes effect today

Saudi Arabia’s Law on Expropriation for Public Benefit and Temporary Seizure of Real Estate came into effect today, Jan. 17, following the lapse of 120 days from its publication in the Official Gazette.

According to the State Properties General Authority (SPGA), the law sets a unified, transparent framework for expropriation and temporary seizure, ensuring fair compensation for property owners while improving governance by centralizing oversight under the Authority.

Key provisions include property valuation at fair market value by certified appraisers, with an additional 20% compensation for expropriation. It also covers temporary seizure compensation equal to market rent plus 20%; and tax exemptions for affected owners, including a five-year real estate transaction tax exemption (up to the value of compensation) when purchasing replacement properties, and exemption from white land fees if compensation is provided as alternative land.

Before initiating expropriation, authorities must first seek suitable alternatives from state-owned properties and ensure financial allocations are secured, supporting efficient public spending and sustainable development across the Kingdom.