Guide for network device vendors · Saudi local content
Selling network devices into Saudi public tenders: the local content rules, and what local assembly changes
If your ONTs, 5G CPE, MiFi or mesh Wi-Fi systems are bid into Saudi government projects, three local content mechanisms decide whether an imported unit is eligible and how it is scored. This guide explains each one from the source regulation, how buyers request exceptions, and the trade-offs between importing and assembling locally under your own design.
Published 7 min read
In short
- Mandatory list: where a product category is on LCGPA's mandatory list, government entities must buy the national product, and non-compliant bids are excluded from supply tenders and from mixed tenders that include supply items.
- Price preference: for national products not on the list, a foreign product is evaluated as if its price were 10% higher.
- Local content weighting: in high-value contracts other than supply contracts, local content is scored alongside price, and a bidder below a minimum baseline can be disqualified.
- Your options: import and depend on buyer-requested exceptions, assemble in the Kingdom with a contract manufacturer under your design, or build your own plant.
The three mechanisms, from the regulation itself
All three come from the Regulations on Preference for Local Content and Local SMEs and Companies Listed on the Capital Market in Business and Procurement Transactions, issued by Council of Ministers Resolution No. 245 (2019) and administered by LCGPA. They apply to government entities when they tender and buy, and to contractors when they execute government contracts.
| Mechanism | When it applies | Effect on a bid with an imported device | Where it comes from |
|---|---|---|---|
| Mandatory list | The product category is on the list LCGPA issues and updates | Non-compliant bids are excluded from supply tenders and mixed tenders with supply items (if a bid is divisible, only the non-compliant items); the buyer must not accept non-compliant products during execution unless they were exempted | Articles 1, 4, 8 and 9 |
| National product price preference | The national product is not on the mandatory list | The foreign product's price is treated as 10% higher in evaluation; LCGPA and the Expenditure and Projects Efficiency Authority (EXPRO) can agree a higher percentage, which must then be stated in the tender documents | Article 10 |
| Local content weight and minimum baseline | High-value contracts, except supply contracts | Price carries 60% of the financial score by default, the rest comes from local content baseline, targeted local content and capital-market listing; in procurements it designates, LCGPA can set a minimum baseline, and bidders below it are disqualified at technical evaluation | Articles 14, 15 and 17 |
The regulation defines a national product as any product manufactured in the Kingdom, and local content as total spending in the Kingdom through national elements: goods, services, assets, technology and workforce. A device can therefore be manufactured in the Kingdom while its local content percentage still depends on how much of the build happens locally.
Two things are moving. The list keeps growing: in May 2026 LCGPA's chief executive told the Saudi daily Al Eqtisadiah that it covers more than 1,650 products. And in February 2026 LCGPA made a minimum local content percentage in a factory's establishment-level local content certificate a condition for benefiting from the list. It applies product by product: a first group from 1 August 2026, and, as reported in July 2026, 965 products from June 2028. Check on LCGPA's website whether your device category is covered, and from when.
How a buyer can still buy imported units: the exception route
An exception is handled by the buying government entity, not by the vendor, and the entity documents the grounds. LCGPA's training material on the mandatory list gives these grounds and evidence, among others:
| Reason for the exception | Evidence required |
|---|---|
| National factories don't have the capacity to supply the need | Letters from three different national factories showing they cannot supply it |
| Project-specific specifications that national products don't meet | Letters from three different national factories showing they cannot meet them; an exception is not allowed merely because national factories lack a particular quality standard if they meet an equivalent one |
| The baseline in the local content certificate is not met | Letters from three different factories stating that the baseline is not met |
| Price gap above the ceiling set in the list | Quotations from three different national factories and three foreign quotations; the highest foreign quote is compared with the lowest national quote |
Where a single product's total value exceeds SAR 3,000,000, LCGPA's approval is required; LCGPA responds within 10 working days or the request is deemed approved. Buyers also report excluded products to LCGPA every quarter.
What this means for a vendor: once national factories are registered for your device category, an imported bid depends on the buyer doing this work before or during the tender. Plan for it with the buyer early, or plan a compliant bid.
Three ways to respond, compared
| Option | What you keep control of | Eligibility where the category is listed | Effect on local content | Main risk |
|---|---|---|---|---|
| Import finished devices | Everything | Only through a buyer-requested exception | None | Exclusion, or dependence on the buyer's exception case |
| Contract assembly in the Kingdom under your design (OEM) | Design, specification and firmware; the factory assembles, tests, loads firmware and packages | Possible once the locally assembled product is registered and certified as required | Rises with the local build stage (SKD, then CKD, then full manufacture) and is assessed per product | How the listing and certificate apply to a product carrying your brand must be confirmed with LCGPA; set-up costs make very small runs uneconomic |
| Build your own plant | Everything | Yes, once registered and certified | Highest potential | Capital, licensing, staffing and time to first output |
Questions to settle with a Saudi contract assembler before you bid
- Which build stage runs for your device family today, and which stage is planned, with dates?
- Is the factory registered on the mandatory list for your exact product category, and how will a product carrying your brand be registered? Confirm the route with LCGPA before you bid.
- Who holds the local content certificate the buyer will ask for, and does it meet the minimum that applies in the tender year?
- Who owns the design, the firmware and the test fixtures, in writing?
- Which conformity approvals does the locally assembled model need, who applies for them, and does moving assembly trigger requalification?
- What is tested on every unit and what by sample, against whose acceptance criteria?
- What monthly volume and ramp-up will the factory commit to in a dated capacity letter?
- Who buys components, and who carries allocation and price risk?
For the full supplier checklist, including yield, lead time, second-sourcing and exit terms: How to evaluate a Saudi network equipment manufacturer
RelatedHow to evaluate a Saudi network equipment manufacturer
Where Interkey Semiconductor fits
Interkey Semiconductor is the Interkey group's network device assembly operation in Riyadh. What it offers a vendor today:
- Device families: 5G CPE, mesh Wi-Fi and ONT, with a 5G MiFi line planned. Anything outside these is a case-by-case conversation.
- Build stage: SKD. Final assembly, testing, firmware loading and packaging happen in Riyadh; components and boards are made outside the Kingdom. CKD is planned for 2028, and ODM is a long-term direction.
- Model: OEM contract assembly, open to all network device vendors. We build to your design and specification; the design and firmware stay yours, and custom branding and packaging are agreed per programme.
- Local content status: Interkey's official publications state that Interkey Semiconductor is included on LCGPA's mandatory list as a national factory and is a member of the Saudi Made programme. Verify the registered product and the validity of certificates on LCGPA's platform for your tender.
- Management systems: Interkey Semiconductor's quality, environmental and occupational health and safety management systems are certified to ISO 9001, ISO 14001 and ISO 45001. Ask for the scope of each certificate.
- Not a fit: chip or wafer fabrication (we assemble and test devices; we don't make chips), one-off orders of a few hundred units, and designs that are still changing.
- Commercial basis: quoted per programme and volume.
Network equipment manufacturing in Saudi Arabia
Sources
- Regulations on Preference for Local Content (Council of Ministers Resolution No. 245), English translation published by the Ministry of Finance
- Local Content and Government Procurement Authority
- LCGPA training material on the mandatory list (exception rules and proof of national origin)
- LCGPA requires minimum local content percentages to benefit from the mandatory list (Saudi Press Agency, February 2026)
Questions vendors ask us
Does the mandatory list apply to private-sector buyers?
The regulation addresses government entities in their tenders and purchases, and LCGPA's material requires their contractors to buy listed national products when executing those contracts. Purely private purchasing outside such contracts is not what this regulation addresses. Companies owned by the state are covered by a separate local content regulation, which they should check.
Is "assembled in Saudi Arabia" enough for a device to count as compliant?
No. The product category must be on the list, the factory must be registered for that product, national origin must be evidenced, and a valid local content certificate is needed where required.
Can we bid a Saudi-assembled version of a model we already sell?
In principle, yes, under an OEM arrangement. Check which conformity approvals the locally assembled model needs and who must hold them, and make sure it matches the product registered on the list. Confirm both before the tender, not after award.
How is local content measured?
Through LCGPA's mechanisms and forms on the local content portal, for a specific product and scope of local work. A supplier cannot declare its own percentage; ask for the certificate or assessment itself.
Next
Related resources
Next step
Discuss a local assembly programme
Tell us the device family, approximate monthly volumes and the tender or delivery date. We'll reply with what can be assembled in Riyadh at the current stage, and what you need to confirm with LCGPA and the buyer before you bid.
Or directly
+966-11-2180999 [email protected]Tawuniya Towers, North Tower, 7th Floor, King Fahad Highway, Olaya, P.O. Box 56835, Riyadh 11564, Saudi Arabia