Saudi Arabia requires associations to comply with UN Security Council regulations to combat the financing of terrorism

In a strategic move aimed at strengthening the financial system of the non-profit sector in the Kingdom of Saudi Arabia, the Board of Directors of the National Center for the Development of the Non-Profit Sector a new guiding manual, obligating all non-profit organizations to implement the mechanisms of the UN Security Council resolutions related to combating terrorism and its financing.

This decision aims to enhance the efficiency of the third sector and ensure its compliance with the highest local and international standards, thus contributing to protecting charitable and voluntary work from any illicit exploitation.

Details of the circular and the legal framework

The center issued an urgent circular addressed to the chairpersons of the boards of directors of civil associations, and the chairpersons of the boards of trustees of civil institutions and family funds, stating that the Board of Directors’ decision No. “Q/25/16/7” dated 19 Jumada al-Akhirah 1447 AH (according to the Hijri calendar mentioned in the source).

This regulatory measure is based on a solid legal framework, namely the powers granted to the center for financial and administrative oversight under Cabinet Resolution No. 618, in addition to Article 82 of the Law on Combating Terrorism Crimes and its Financing, issued by Royal Decree No. M/21. This article authorizes regulatory bodies to issue binding instructions and rules for non-profit organizations to ensure the precise implementation of the provisions of the law.

International context and the Kingdom's commitment to global standards

This decision cannot be viewed in isolation from the tireless efforts exerted by the Kingdom of Saudi Arabia internationally in combating money laundering and terrorist financing. The Kingdom is a full member of the Financial Action Task Force (FATF) , the international body responsible for setting global standards to combat these crimes.

The obligation of associations to comply with Security Council resolutions reflects the Kingdom’s strict commitment to the recommendations of the Financial Action Task Force, specifically Recommendation 8 concerning non-profit organizations, which calls on countries to review the adequacy of laws and regulations relating to entities that can be exploited in the financing of terrorism.

The importance of the decision and its impact on Vision 2030

This guide is of paramount importance in light of the Kingdom's Vision 2030 , which aims to increase the contribution of the non-profit sector to the GDP. To achieve this goal, a transparent and secure regulatory environment is essential to foster donor confidence and ensure that funds reach their intended beneficiaries.

The newly adopted guide aims to:

• Raising awareness and commitment among non-profit organizations.
• Clarifying the precise mechanisms and procedures for compliance with Security Council resolutions.
• Updating the application mechanisms in accordance with security developments, in line with State Security Presidency telegram No. “103215”.

Implementation and communication mechanisms

The acting CEO of the center, Dr. Yahya Al-Musattah, stressed the need for all those in charge of non-profit organizations to review the guide and instruct their specialists to immediately comply with the regulations contained therein.

To make things easier for beneficiaries, the center has provided direct access to the guide by visiting the official website, or by scanning the QR code attached to the circular, calling for communication through customer care channels in case of any inquiries to ensure the optimal application of these controls.