A foreign-invested company operating in Saudi Arabia that misses its updated anti-money laundering (AML) filing deadline faces account restrictions. Suspension of its credit facility (a financing arrangement with a licensed bank). Additionally, potential referral to the Public Prosecution. Saudi Arabia's financial regulatory bodies have intensified AML enforcement as part of the Kingdom's broader push toward FATF compliance, and recent amendments to the AML legislative regime carry immediate operational consequences for international businesses.
Saudi Arabia has updated its AML compliance obligations through amendments to its anti-money laundering legislation, effective from early 2025. The changes tighten know-your-customer (KYC) requirements, expand beneficial owner disclosure duties, and impose stricter controls on correspondent banking relationships. Companies operating in the Kingdom. including foreign branches, joint ventures. Additionally. Licensed financial entities. must complete internal compliance reviews and update their customer due diligence records within the timeframes set by the Saudi Central Bank, known as SAMA (Saudi Arabian Monetary Authority).
This alert sets out what has changed, which business categories are affected, and the immediate steps international companies must take to avoid regulatory sanction.
What changed and when it takes effect
The updated AML rules amend Saudi Arabia's existing anti-money laundering and counter-terrorism financing legislative regime. The principal changes entered into force in the first quarter of 2025. SAMA issued supplementary guidance simultaneously, applying to all licensed financial and quasi-financial entities.
The core changes are as follows. First, KYC standards have been raised for all customer categories. Enhanced due diligence is now mandatory for a broader range of counterparties, not only those previously classified as high-risk. Second, the definition of beneficial owner – the natural person who ultimately owns or controls a legal entity – has been expanded. Thresholds for disclosure have been reduced, meaning more individuals must now be identified and verified. Third, correspondent banking relationships – arrangements between domestic and foreign banks for cross-border payments – are subject to tighter pre-approval and ongoing monitoring requirements. Fourth, transaction monitoring obligations have been extended to cover a wider range of payment channels and digital instruments.
Firms that fail to bring their internal procedures into line with the updated rules face administrative penalties under Saudi financial regulatory law. These can include fines, licence suspension, and restrictions on bank account opening for new corporate clients.
For international companies already active in Saudi Arabia's capital markets, the updated rules intersect directly with securities regulation. Our analysis of capital markets matters in Saudi Arabia addresses the compliance overlap between AML obligations and securities licensing requirements.
Which companies are affected
The updated obligations apply broadly. The following business categories face the most immediate compliance demands.
- Licensed banks and finance companies operating under SAMA supervision – including foreign bank branches – must update their KYC and beneficial owner registers without delay.
- Fintech and payment service providers holding licences from SAMA or the Capital Market Authority face expanded transaction monitoring duties across digital channels.
- Companies with correspondent banking arrangements – including any entity that routes cross-border payments through a Saudi-licensed institution – must confirm that their bank counterparts have completed the new pre-approval assessments.
- Foreign-invested companies and joint ventures that opened corporate bank accounts in Saudi Arabia must resubmit beneficial owner declarations where the underlying ownership structure has changed since the last filing.
- Professional service firms – including legal, accounting, and corporate services providers – that fall within the scope of Saudi Arabia's designated non-financial businesses and professions (DNFBP) rules are now subject to customer due diligence requirements comparable to those applied to financial institutions.
The threshold for beneficial owner disclosure has been reduced under the amended rules. Any natural person holding a direct or indirect ownership interest above the new lower threshold must be identified, verified, and recorded. Companies with layered or multi-jurisdictional ownership structures face particular exposure here. If a parent company registered outside Saudi Arabia controls a local subsidiary, that parent's own beneficial owner chain must now be traced and documented.
For a comprehensive overview of the regulatory environment applicable to banking and finance operations in the Kingdom, see our banking and finance service page for Saudi Arabia.
To receive an expert assessment of your AML compliance position in Saudi Arabia, contact us at info@ferrazwhitmore.com.
Immediate actions for international companies
Companies should treat the first half of 2025 as the operative compliance window. SAMA's supplementary guidance sets out remediation timelines, and firms that have not initiated internal reviews are already behind schedule. The following actions are required.
1. Audit your beneficial owner register. Map the full ownership chain of your Saudi entity back to the natural person or persons who ultimately exercise control. Any individual who meets the revised disclosure threshold must be added to the register. Verify identification documents are current.
2. Update your KYC files for existing customers and counterparties. Enhanced due diligence must now be applied to categories of client previously handled under standard procedures. Review your customer risk classification matrix against the updated criteria and escalate files where the risk profile has changed.
3. Review correspondent banking arrangements. If your business involves cross-border payment flows through Saudi-licensed banks, confirm that your banking partners have completed SAMA's new pre-approval process. Arrangements that have not been re-assessed are at risk of suspension.
4. Update your AML internal controls policy. Your written AML programme must reflect the current legislative requirements. A policy drafted before the 2025 amendments is non-compliant on its face. Revise transaction monitoring thresholds, escalation procedures, and staff training schedules accordingly.
5. Prepare for SAMA examination. SAMA has signalled an increase in on-site and desk-based AML reviews across supervised entities. Ensure your compliance officer has a current regulatory examination file – including updated policies, customer due diligence records, and evidence of staff training – available for inspection.
Companies that are also monitoring parallel AML regulatory developments in neighbouring jurisdictions may find our alert on AML updates in the UAE useful for a comparative regional view.
About Ferraz & Whitmore
Ferraz & Whitmore is an international law firm based in Lisbon, advising business clients across 46 jurisdictions. Our team combines Portuguese civil law expertise with English common law tradition to deliver cross-border legal solutions in banking and finance regulation, AML compliance, and financial services licensing. We advise international companies, financial institutions, and in-house legal teams operating in Saudi Arabia and across the broader Middle East on KYC obligations, beneficial owner disclosure, and regulatory engagement with SAMA. Our Asia-Pacific, Middle East, and CIS practice covers the full spectrum of compliance demands in high-growth markets. As a law firm in Saudi Arabia matters, we work alongside local counsel to provide practical, results-oriented advice. To discuss your AML compliance position in Saudi Arabia, contact us at info@ferrazwhitmore.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.