Facilitating the release of goods from Saudi ports before payment of fees

The Saudi Ports Authority (Mawani), in cooperation with the Zakat, Tax and Customs Authority, announced updated regulations and procedures for releasing goods from Saudi ports before payment of storage and handling fees. This new mechanism has been piloted at King Abdulaziz Port in Dammam, aiming to expedite customs clearance and reduce container dwell time, thereby enhancing operational efficiency and supporting trade in the Kingdom.

General context: A strategic step within Vision 2030

This initiative comes as an integral part of the ongoing efforts to achieve the objectives of the National Transport and Logistics Strategy, which is based on consolidating the Kingdom’s position as a global logistics hub and a link between the three continents, in line with Saudi Vision 2030. Historically, the procedures for releasing goods required importers to pay all due fees, including storage fees, before containers were allowed to be released, which sometimes led to delays in the supply chain and an increase in operating costs for the business sector.

The new update aims to address these challenges by separating the financial payment process from the actual release of goods, giving importers greater flexibility and accelerating the pace of the import and distribution cycle within the local market.

The importance of the update and its expected impact

This change in procedures is of great importance on various levels, and is expected to have tangible positive effects:

• At the local level, importers and local businesses will directly benefit from reduced time their goods spend in ports, meaning faster delivery of products to markets and consumers. This will also improve companies' cash flow and reduce additional costs such as demurrage fees, thus enhancing the competitiveness of their products in the Saudi market.
• At both the regional and international levels, this measure enhances the attractiveness of Saudi ports as a key entry point for goods destined for the region. Streamlining procedures and reducing time and costs makes the Kingdom a more competitive destination for global shipping lines and international companies. This step will contribute to improving the Kingdom's ranking in global logistics indicators, such as the World Bank's Logistics Performance Index (LPI), thus reinforcing its position as a pivotal player in global trade.

New work mechanism and future aspirations

The updated mechanism allows importers to release their goods immediately upon completion of customs clearance procedures, with storage and handling fees to be collected later from the shipping agent. This shift towards immediate financial liability ensures that the movement of goods is not delayed by financial procedures. The success of this initiative is a result of collaboration and integration between the Saudi Ports Authority (Mawani), the Zakat, Tax and Customs Authority, and the Fasah platform, reflecting the maturity of the digital infrastructure of the logistics sector in the Kingdom.

With the implementation beginning at Dammam port, the experiment is expected to be evaluated and expanded to include the rest of the major Saudi ports, such as Jeddah Islamic Port, in the near future, which will bring about a qualitative shift in the efficiency and smoothness of logistical operations at the level of the Kingdom as a whole.