Procurement Risk:
Critical
Score:
6/100
Government Policy
Q57
0/100
Does the country have legislation covering defence and security procurement with clauses specific to corruption risks, and are any items exempt from these laws?
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This indicator is not assigned a score in the GDI. Saudi Arabia has legislation that addresses defence procurement, in its Government Tenders and Procurement…
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There is no mention of corruption risks in Saudi-based legislation that covers defence and national security procurement. According to our sources, there are mentions…
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According to our sources, there are consistent and common exceptions within defence procurements in the defence sector. This includes strategic purchases, and the more…
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Q58
25/100
Is the defence procurement cycle process, from assessment of needs, through contract implementation and sign-off, all the way to asset disposal, disclosed to the public?
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According to our sources, there is a process which defines through regulations procurement within the MoD. However, this process lacks crucial elements, such as…
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The defence procurement cycle is not disclosed to the public. Details of defence acquisitions are typically published after the fact, by international media outlets,…
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The policies and procedures are not clear, and the steps need more clarification. It gives room for different individuals and units to have different…
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Q59
0/100
Are defence procurement oversight mechanisms in place and are these oversight mechanisms active and transparent?
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Oversight mechanisms are not formalised and active. According to a source, there a minimal oversight on delivery of purchases, which includes signing papers, but…
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This sub-indicator is marked Not Applicable as there are no defence procurement oversight mechanisms. As mentioned above, GAMI’s role in the new defence architecture…
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This sub-indicator is marked Not Applicable as there are no defence procurement oversight mechanisms. The research found that there is no transparency, with regards…
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According to our sources, there is a forward planning process in place, in terms of the government’s strategic defence purchases, which is usually between…
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Sources have said, the MoD does not publicly announce expected purchases. Purchases remain secret until the final days unless they are leaked by another…
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According to our sources, there is no law or policy of disclosing military and defence purchases. Purchases are dealt with in secretively. Total defence…
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The government itself does not release details on defence purchases. According to our sources, accessibility to such data is not possible either to the…
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Capability Gap and Requirements Definition
Q62
0/100
What procedures and standards are companies required to have – such as compliance programmes and business conduct programmes – in order to be able to bid for work for the Ministry of Defence or armed forces?
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According to our sources, there are no laws, but internal regulations that detail how the government discriminates in its selection of suppliers and contractors.…
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As there are no laws, this sub-indicator is marked Not Applicable. According to our sources, laws and regulations on government contractor selection criteria in…
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Q63
0/100
Are procurement requirements derived from a national defence and security strategy, and are procurement decisions well-audited? Are defence purchases based on clearly identified and quantified requirements?
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Although there is a new defence strategy within the armed forces, it is had to assess whether the procurement requirements are derived from any…
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Interviewee’s said, there are no oversight mechanisms or scrutiny over actual purchases. The consultative body, the Auditing Bureau and the internal units have no…
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According to our sources, major MoD purchases are politically motivated. They are deals with billions of UDS to be an ally of major powers…
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Tender Solicitation, Assessment and Contract Award
Q64
0/100
Is defence procurement generally conducted as open competition or is there a significant element of single-sourcing (that is, without competition)?
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According to our sources, around half of the procurement is done through open competition. However, competitors are invited to compete through the pool of…
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There is no power or authority with oversight mechanism to question either single-source bids, or any other form of bid in the Saudi defense…
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Q65
6/100
Are tender boards subject to regulations and codes of conduct and are their decisions subject to independent audit to ensure due process and fairness?
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Sources report, there is a tender board that is designed from members of different agencies such as MoF, MoD, and GAMI. The members have…
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Although the Ministry of Finance does have a mandate to provide oversight and is legally required to review all contracts valued at SAR 5…
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The Government Procurement Law states that all government bids must be announced in the official gazette Umm al-Qoura (Arabic), in two local newspapers, as…
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Although the Ministry of Finance does have a mandate to provide oversight and is legally required to review all contracts valued at SAR 5…
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Q66
13/100
Does the country have legislation in place to discourage and punish collusion between bidders for defence and security contracts?
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According to our sources, there is an internal policy that is attached to every contract (bidders dossier) which every bidder has to submit before…
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Sources report, the procurement officials have no authority to exclude any company. Excluding any company needs approval from a committee of procurement or tender…
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According to our sources, superficial hearings and investigations occur with companies that break the law. However, due to political pressure and interference by senior…
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There is no training provided to procurement officials with regards to collusion (1).
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Contract Delivery and In-Service Support
Q67
25/100
Are there mechanisms and procedures that ensure that contractors meet their obligations on reporting and delivery?
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According to our sources, there are internal policies and regulations (defined procedures) that outline how to monitor and report on contractor service and deliverables.…
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According to our sources, there is no transparency or information released by the Saudi government surrounding reporting and delivering procedures. Other sources report, that…
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Sources report, the procurement department has an in-house reporting and monitoring mechanism of defence contracts. However, they do not perform all parts and types…
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There are no known cases of breaches in Saudi defence contracts; however, according to our sources, violations of contracts are usually solved informally between…
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Q68
33/100
Are there mechanisms in place to allow companies to complain about perceived malpractice in procurement, and are companies protected from discrimination when they use these mechanisms?
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In the past, companies could complain to the Board of Grievances (BOG), Saudi Arabia’s principal and highest administrative tribunal. The BOG had jurisdiction over…
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Sources report, that the complaint mechanism is not only costly in time and efforts, but it can lead to future exclusion, which means huge…
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According to sources, companies and suppliers fear exclusions when using formal mechanisms, as there are no policies to protect them from arbitrary actions. Therefore,…
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As also mentioned in the 2015 TI Defence Report, the Saudi Government Procurement Law of 1966 states that companies found to be in violation…
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This sub-indicator is scored Not Applicable because procurement officials have no authority to exclude companies or individuals implicated in bribery or corruption related offences.…
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This sub-indicator is scored Not Applicable because procurement officials have no authority to exclude companies or individuals implicated in bribery or corruption related offences.…
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Offset Contracts
Q70
0/100
When negotiating offset contracts, does the government specifically address corruption risk by imposing anti-corruption due diligence on contractors and third parties?
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According to our sources within Saudi Arabia, offset contracts are not regulated and managed through the Office of the Crown Prince (1), (2).
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When offset contracts are negotiated, there is no mention of corruption or anti-corruption efforts. Corruption risk is not an issue when signing contracts (offset…
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According to our sources, there are no policies and regulations with regards to offset contracts. Most offset contracts are managed through the crown prince’s…
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As with defence and security deals in general, the Saudi government does not release details to the public surrounding its offset contracts. According to…
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Procurement offices are not engaged in monitoring or reporting on delivery obligations in offset contracts. There is anecdotal evidence of Saudi government officials following…
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Sources report that offset contracts are where corruption is most likely to occur as there is no oversight, no reporting, and there are no…
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According to our sources, there is no competition with regards to offset contracts. All offset contracts are single-sourced and suppliers are invited by the…
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Agents / Brokers
Q73
0/100
How strongly does the government control the company’s use of agents and intermediaries in the procurement cycle?
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Saudi law previously prohibited the use of agents and intermediaries in dfence procurement via the Royal Decree M/S (1978 – commonly known as the…
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This sub-indicator is scored Not applicable as it is widely known that despite the existence of vague regulations banning the use of foreign agents…
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Financing Package
Q74
0/100
Are the principal aspects of the financing package surrounding major arms deals, (such as payment timelines, interest rates, commercial loans or export credit agreements) made publicly available prior to the signing of contracts?
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According to our sources, arms deals occur in the Crown Prince’s office and not through the MoD. Therefore, the MoD is unaware of the…
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Seller Influence
Q75
NS/100
How common is it for defence acquisition decisions to be based on political influence by selling nations?
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This indicator is not assigned a score in the GDI. According to our sources, almost all arms deals of the KSA are politically motivated…
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This indicator is not assigned a score in the GDI. According to our sources, there are no public deliberations or justifications for military procurements…
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This indicator is not assigned a score in the GDI. According to our sources, there are no political parties, no lobbyist groups, and no…
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