Inside Saudi Arabia’s Emerging Technologies Sandbox 


Regulators are looking for ways to find a balance between enabling growth and driving competition on the one hand and safeguarding the wellbeing and security of citizens on the other.

The Regulatory Sandbox aims to increase investment, foster innovation, maintain adequate consumer protection, and encourage new products and services into the Saudi markets.

Many regulators worldwide have launched regulatory sandboxes that allow firms to fast-track experimentation using emerging technologies in a protected environment. The idea is to provide regulatory certainty for new technologies and services.

In line with Saudi Arabia’s Vision 2030, the Communications and Information Technology Commission (CITC) launched the Emerging Technologies Regulatory Sandbox to support investors and companies interested in the Kingdom’s emerging tech field. The Regulatory Sandbox aims to increase investment, foster innovation, and maintain adequate consumer protection.

The initiative’s targeted technologies include the Internet of Things (IoT), Blockchain, Augmented Reality/Virtual Reality/Extended Reality (AR/VR/XR), Digital Twin, 3D/4D printing, and cloud computing.

Image Source: CITC

The Sandbox targets creating a flexible and stimulating environment for emerging technology service providers by clarifying and improving the regulations and enablers important to developing the emerging technology market.

According to CITC, such an environment will enable emerging technology service providers to offer innovative work models, solutions and services that accelerate the digital transformation of all sectors, attracting local and international investments and maximising the benefit of emerging technologies.

Companies in the sandbox will benefit from regulatory waivers, guidance and support from CITCs partner network. The listed exit scenarios for companies that complete the programme could include a grant of full regulatory approvals, limited approvals or proposals for further testing.

All You Need To Know - Saudi Arabia is launching an Emerging Technologies Sandbox (Velocity KSA) inside text box image_DTV

The CITC sandbox is not the first in the Kingdom, with the Saudi Central Bank (SAMA) issuing a regulatory sandbox framework for fintech companies in 2019. As part of the Financial Sector Development Program (FSDP) seeks to develop the financial industry as a diversified and effective financial services sector to support the development of the national economy by stimulating savings, finance and investment by, inter alia, enabling financial institutions to support private sector growth.

In February, the Minister for Communications and Information Technology, Engr. Abdullah Alswaha announced that Saudi Arabia would invest more than $6.4 billion in future technologies to drive innovation. Meanwhile, the country is also looking to ramp up foreign direct investment in its economy to spur its grand-scale economic diversification plans.

In November 2021, the Digital Government Authority (DGA) launched the regulatory sandbox initiative for government technical companies to find organisational solutions in digital platforms and services. The initiative to enhance digital government services, preparing the necessary regulations to improve the business environment. In addition to addressing the challenges facing companies and institutions in digital government services and improving the beneficiary’s experience.

Saudi Arabia has undergone massive change, updating its regulatory environment to make laws more investor and business-friendly. The Kingdom has improved its ease of doing business as it seeks to diversify its economy away from oil under its ambitious Vision 2030 plan.

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