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Saudi Arabia may close expat-run service stores: Report

Thousands of small stores and service outlets run by guest workers in Saudi Arabia are facing the possibility of closure, as part of new regulations formulated by the ministry of labour, it has been reported.

world Updated: Jul 04, 2011 13:44 IST

Thousands of small stores and service outlets run by guest workers in Saudi Arabia are facing the possibility of closure, as part of new regulations formulated by the ministry of labour, it has been reported.

The ministry is making efforts to combat "tasattur", the illegal understanding whereby Saudis permit foreigners to manage businesses in their names in return for a stake in the profits.

The move will affect over 120,000 commercial businesses in Jeddah alone, a 'Saudi Gazette' report said quoting a ministry source.

According to the report, the proposed move is part of the ministry's 10-point programme for the employment of Saudi youth and targets a sector in which 85% of jobs are taken by guest workers.

"Tasattur businesses have virtually a complete monopoly on the retail sector. Shops, stores and outlets operating under tasattur are rife across the country, and many guest workers have expanded their tasattur businesses by bringing in relatives, thereby depriving Saudi nationals of their right to work in their own country," the source told the newspaper.

Under the measures, small commercial businesses which previously required only municipality licenses to operate will now have to obtain the same chamber of commerce commercial registers as required of larger operations.

Dedicated departments will be set up at chambers of commerce to ensure compliance and specific sectors at the Ministry of Interior will also be involved in the anti-tasattur fight, the report said.

According to the report, though the authorities will allow a period of grace for businesses to legalise their status and meet Saudization – or 'nationalisation' in the new parlance of the ministry requirements.

"We would greatly appreciate it if guest workers help Saudis and the government by assisting in the training of Saudi staff," the report said adding, both Saudis and guest workers involved in tassatur businesses can request help from the relevant departments at their chambers of commerce.