Amendment of the Two Rules Related to Private Associations and Foundations

Saudi Central Bank
Reference No.: 106878603
Date: 1446/07/01
Attachments: 5 attached pages

Subject: Amendment of the Two Rules Related to Private Associations and Foundations.

Circular

To: Distinguished,
Peace, mercy, and blessings of God be upon you,

I refer to Rule No. (300-1-5-2) regarding private associations, and Rule No. (300-1-5-3) regarding private foundations, included within the reported bank accounts rules issued pursuant to SAMA Circular No. (65681/17) dated 1440/11/1 AH, and to the National Non-Profit Sector Development Center Organization issued pursuant to Council of Ministers Resolution No. (618) dated 1442/10/20 AH, and the Executive Regulations of the Law of Private Associations and Foundations issued pursuant to Council of Ministers Resolution No. (Q/2022/2) dated 1444/03/22 AH, and additionally to the Saudi Central Bank Circular regarding the establishment of a paragraph within Rule No. (300-1-5-3) for private foundations, issued under No. (45065133) dated 1445/10/14 AH.

I hereby inform you of the amendment of the aforementioned two rules according to the attached format, noting that the key amendments are as follows:

1. Replacing the definition of the National Non-Profit Sector Development Center ("the Center") with the word Ministry of Human Resources and Social Development ("the Ministry") wherever it appears.
2. Removing the requirement to obtain the Bank's Compliance Director's approval for opening accounts, with respect to private associations and foundations.
3. Removing the requirement to obtain "the Center's" approval for opening an expense sub-account, establishing unified requirements for sub-accounts, and facilitating the management of these accounts so that withdrawal and deposit operations from them are not restricted by the main account.
4. Removing the specification of positions for account managers/operators, and sufficing with the requirement that signatures be joint and obtaining the Center's approval when the authorized persons are from outside the board.

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5. Removing the approval of the activity supervisory authority for transfers outside the Kingdom or receipt of remittances, and sufficing with the Center's approval.
6. Not permitting the acceptance of donations, bequests, contributions, endowments, grants, and zakat on private foundation accounts from non-founders stipulated in the foundation's bylaws, except with the Center's approval.

For information and action as of its date,

Yours sincerely,

Distribution Scope:

• Banks and financial institutions operating in the Kingdom.

(Signature)
Yazeed bin Ahmed Al Sheikh
Deputy Governor for Supervision