The new law (Royal Decree No. M/169 dated 14/08/1447 AH) represents a significant modernization of the Kingdom's intellectual property framework, introducing expanded protections and enhanced enforcement mechanisms to ensure the Kingdom’s laws reflect modern practices.
This alert highlights the key changes and the implications for rights holders and organizations operating in Saudi Arabia.
Overview
The new Copyright Law establishes a comprehensive legal framework for the protection of copyright in the Kingdom. The new law will come into force on 1 August 2026, and the implementing regulations to the new law should be issued by such date.
Key changes
Geographical scope
Article 18 of the previous Copyright Law limited the geographical scope of that law to:
- works of Saudi and non-Saudi authors published in the Kingdom
- works of Saudi authors published for the first time outside the Kingdom.
As a nod to international rights holders, Article 2 of the new law expands the scope to cover works first published in the Kingdom, or first published in another country and then published in the Kingdom within 30 days from the date of first publication, regardless of the author's nationality or place of residence.
Authors' moral rights
Article 7 of the new law further clarifies the framework for authors' moral rights, which are expressly stated in the new law as being perpetual, non-transferable, and non-waivable.
Compared to Article 8 of the previous law, moral rights now further align with international standards and explicitly include the right to:
- publish the work for the first time
- have the work attributed to the author, or to publish it under a pseudonym or without a name
- object to publication under another person's name
- object to modifications involving distortion, alteration, or prejudice to the author's reputation.
The new law also introduces a specific right for authors to request a competent court to prevent the distribution of their work, or to withdraw it from circulation, based on “serious reasons” justifying such action. The management of moral rights also pass to an author’s heir on death, pursuant to Article 7 of the new law.
We expect that further details regarding how these rights will work in practice will be set out in the implementing regulations.
Work for hire
While Article 12 of the previous law expressly prohibited a future assignment of copyright, Article 18 of the new law finally provides clear provisions regarding works created in the course of employment. If an employee creates a work during their employment relating to the employer's activities or business, the author's rights will automatically vest in the employer, subject to certain conditions/exceptions.
These provisions represent a significant clarification compared to the previous law, which did not expressly address well-recognized work for hire provisions. However, employers in the Kingdom must wait for the implementing regulations to fully understand the impact Article 18 has on their IP protection strategies.
Software licensing
Article 12 of the new law seeks to clarify that:
- computer programs, their applications and databases are subject to the license terms for those programs
- the purchaser/user of the program will be bound by the terms of such license, unless such terms are contrary to public order or morals
- the implementing regulations are to determine any related provisions.
While at face value Article 12 seems to reflect basic privity principles, for software providers operating the Kingdom, the extent to which the implementing regulations provide further rights to, or obligations on, licensees will undoubtedly be carefully monitored.
Exceptions for AI
Article 26 of the new law substantially expands the permitted uses of copyrighted works. Notable additions include permitting reproduction of original works without the author’s permission and without compensation for the purposes of developing artificial intelligence products and algorithms. However, to rely on this right:
- the work must have been published lawfully
- ownership of the original copy must have been obtained lawfully
- the reproduction must be limited to what serves the stated purpose
- the use of the work must not conflict with the normal exploitation of the work
- the use must not cause unreasonable prejudice to the legitimate interests of the rights holders.
While the hurdles that must be met to rely on this exception appear high, the scope of this exception is potentially extremely broad. This could, in theory, facilitate text and data mining and scraping activities, machine learning training processes and other AI development activities that require the ingestion of large volumes of copyrighted content. The requirement for reproduction to be “limited to what serves the purpose” introduces a subjective proportionality test which will require clarification through the implementing regulations or guidance from SAIP.
Interestingly, the exception does not expressly address several core issues that have arisen in other jurisdictions, such as whether outputs generated by AI systems trained on copyrighted works may themselves constitute derivative works and whether the exception extends to commercial development or is limited to non-commercial purposes.
As AI continues to be a core investment strategy in the Kingdom, players in that market should monitor the implementing regulations in order to ascertain whether such regulations provide further interpretation on how this exception is expected to be used.
Internet content provider liability
The new law introduces a welcomed safe harbor regime for internet content providers (i.e., an entity that hosts internet content and makes it available to end users via the internet).
Under the new law, an internet content provider will not be considered a participant in an infringement if the:
- passing, routing, storage, and display of data is carried out in a purely automatic technical manner
- provider does not modify the content (unless technically automatic and necessary)
- provider has no knowledge of the infringement
- provider removes infringing content within a reasonable time after becoming aware
- provider has put in place measures enabling rights holders to notify it of infringement.
While this clarification will be welcomed by many operating in the technology sector in the Kingdom, concepts such as knowledge of infringement and having measures in place to notify rights holders of infringement remain subject to further scrutiny and clarification.
Enforcement and penalties
The new law substantially strengthens enforcement mechanisms and increases penalties. While under the previous law, violators could be subject to six months’ imprisonment, the new law increases this to one year. Moreover, the new law sees financial penalties quadruple from SAR250,000 to SAR1million (and up to SAR2m for repeated breaches).
As a triumph for IP protection in the Kingdom, Article 51 of the new law provides right holders with codified statutory protections, including the right to claim compensation for the damages suffered as a result of third-party infringement (with such compensation including the profits gained by the infringer from the infringement).
Next steps
For businesses operating in the technology sector in KSA, the explicit exceptions for artificial intelligence development and the safe harbor provisions will be of particular interest, prompting a review of internal policies regarding the use/sharing of third-party content.
For employers in the Kingdom, any contractual attempts to manage the previous gaps regarding work for hire should be reviewed in accordance with Article 18 and the implementing regulations, once released, to ensure compliance.
