المملكة: A new regulation obligates government agencies to provide 15 million riyals annually to support innovation – urgent

These amounts will be directed to finance research and development projects implemented by companies registered in the Kingdom, to ensure the sustainability of spending on research and development programmes.

The innovative sector in Saudi Arabia

It will be responsible for "Research, Development and Innovation Development Authority" (The Authority) will supervise the implementation of the regulations, as it will approve the topics of projects proposed by the authorities, while determining "Supreme Committee for Research, Development and Innovation" Targeted national priorities.

The regulation imposes an additional obligation on entities whose program budget exceeds 25 million riyals, as they must allocate no less than 20% of this budget to projects implemented in partnership between the beneficiary “the company” and research institutions.

The proposed mechanism relies on a contract model of three successive and separate stages, to ensure Moving ideas from the feasibility stage to the final product. It is required that all phases of the project be implemented within the Kingdom.

Technical and commercial feasibility study

The first stage begins with a project to study the technical and commercial feasibility, and it is presented through a public competition. The maximum cost of this stage is one million riyals, and the implementation period does not exceed one year.

Beneficiaries who successfully pass the first stage move to the second stage, which is developing the prototype. The maximum cost of this phase is four million riyals, and its implementation period is two years, with the possibility of extension with the approval of the Authority. The government agency can offer this stage through limited competition or direct purchase for qualified candidates.

As for the third stage, which is “commercialization”, it does not depend on direct funding from the program, but rather on motivating the beneficiary to obtain external financing.

The “authority” provides incentives that include granting preferential benefits to the product, and allowing the concerned government agency to purchase the final product. Through the direct purchase method.

Research and Development

With regard to rights, the regulations addressed the issue of intellectual property, as it stipulated that the intellectual property resulting from research and development work within the program belongs to the person who obtained it, with detailed provisions explained in the contract forms. The rights to the data resulting from the project are also attributed to the beneficiary, with the government entity’s obligation to protect its confidentiality and reserve the right to access it for evaluation purposes.

The regulations set controls for subcontracting, setting a maximum of 50% of the project value, which can be raised to 60% with the approval of the “Authority.” In cases of partnership with research institutions, the implementation percentage of the beneficiary himself must not be less than 40%, and the implementation percentage of the research institution must not be less than 30%.

The “Authority” will be responsible for supervising and monitoring the commitment of government agencies to allocate the specified budgets, ensure the soundness of tender and contracting procedures, and ensure that the project outcomes achieve their goals. The regulations are scheduled to come into effect 180 days after the date of their official publication.