Compliance and Regulations
Project Control Compliance and Regulations – A 360° Approach at BEC Arabia
Ensuring Regulatory Alignment, Contractual Compliance, and Governance in Mega Construction Projects
1. Introduction
In the construction industry, Project Control is the central authority for regulatory and contractual compliance. At BEC Arabia, Project Control Compliance and Regulations ensure that all project activities align with KSA construction laws, financial governance, contractual obligations, and international best practices.
A 360° compliance approach integrates contract administration, finance, procurement, risk management, and site operations to ensure adherence to legal, financial, and quality standards while mitigating regulatory risks.
This framework guarantees that BEC Arabia meets the highest standards of compliance, including:
Saudi Building Codes & Municipal Regulations
FIDIC Contractual Compliance
Saudi Contractors Authority (SCA) Regulations
Etimad Platform & Government Procurement Rules
ISO Standards (ISO 9001, ISO 45001, ISO 14001)
2. Key Compliance Domains in Project Control
The Project Control Department ensures compliance across five core domains, each integrating with multiple departments:
2.1 Contractual Compliance
Ensures that project execution adheres to contractual obligations, avoiding disputes and penalties.
Key Compliance Areas:
FIDIC Contract Management – Ensuring adherence to contractual terms for scope, cost, and schedule.
Variation & Claims Management – Assessing contractual variations and implementing proper approval workflows.
Extension of Time (EOT) Compliance – Ensuring justified delays follow FIDIC and contractual provisions.
Subcontractor Performance Compliance – Verifying that subcontractor work aligns with contract requirements.
Collaboration: Contracts Administration, Legal, Finance
2.2 Regulatory Compliance & KSA Construction Laws
Ensures compliance with Saudi construction laws, licensing, and municipal approvals.
Key Compliance Areas:
Saudi Building Codes Compliance – Ensuring all designs, materials, and execution align with local regulations.
Environmental & Safety Regulations – Compliance with Saudi GACA, Royal Commission, and Ministry of Environment standards.
Workforce & Labor Law Compliance – Ensuring site operations comply with MHRSD (Ministry of Human Resources and Social Development) labor regulations.
Municipality & Civil Defense Approvals – Securing necessary permits for construction activities.
Collaboration: Engineering, HSE, Legal, Government Affairs
2.3 Financial & Cost Compliance
Ensures budgetary alignment and financial reporting comply with Saudi financial governance laws and international accounting standards.
Key Compliance Areas:
Cash Flow & Payment Milestone Compliance – Aligning financial approvals with actual project progress.
Government Procurement Rules & Etimad Compliance – Ensuring government-funded projects meet tendering and payment policies.
VAT & Tax Compliance – Ensuring all project transactions adhere to ZATCA (Zakat, Tax, and Customs Authority) laws.
Wage Protection System (WPS) Compliance – Ensuring salaries and labor payments comply with government payroll regulations.
Collaboration: Finance, Procurement, Legal, Project Accounting
2.4 Risk & Quality Compliance
Ensures project risks are mitigated and quality standards are maintained.
Key Compliance Areas:
ISO Certification Compliance (ISO 9001, ISO 45001, ISO 14001) – Ensuring quality, safety, and environmental standards are met.
Risk Mitigation & Incident Compliance – Identifying regulatory risks and maintaining incident reporting logs.
Health & Safety (HSE) Regulatory Compliance – Adhering to Saudi Aramco, NEOM, and Giga Project safety standards.
Supply Chain & Material Compliance – Ensuring materials meet regulatory quality and import standards.
Collaboration: HSE, Quality Control, Risk Management, Procurement
2.5 Reporting & Audit Compliance
Ensures transparent project performance tracking and regulatory reporting.
Key Compliance Areas:
Project Status Reporting to Regulatory Authorities – Aligning with SCA, NUPP, and PIF compliance guidelines.
Audit Compliance & Financial Transparency – Ensuring project finances meet government audit standards.
Digital Documentation & Record-Keeping – Ensuring all project documents comply with Aconex & ISO 9001 documentation policies.
Collaboration: Internal Audit, Legal, Project Control, Document Control
3. Compliance Workflow & Governance Framework
To ensure compliance across all project phases, BEC Arabia follows a structured governance workflow:
Phase
Department
Compliance Role
Key Deliverables
Tendering & Contracting
Contracts & Legal
Ensuring FIDIC & Etimad compliance
Bid Evaluation, Contract Review
Planning & Design
Engineering & Project Control
Aligning project designs with Saudi Building Codes
Design Approval, Risk Assessment
Procurement & Supply Chain
Procurement & Finance
Ensuring supplier compliance with financial regulations
Vendor Approval, Material Compliance
Execution & Site Operations
Site Management & HSE
Ensuring HSE & labor law compliance
HSE Inspections, Safety Logs
Financial & Cost Control
Finance & Audit
Ensuring budgetary alignment with regulatory standards
Cost Reports, Tax Compliance
Project Closeout & Handover
Document Control & Legal
Ensuring final regulatory approvals
Completion Certificates, Audit Reports
4. Compliance Monitoring & Audit Process
To ensure continuous compliance, BEC Arabia implements a structured audit process:
4.1 Internal & External Audits
Quarterly Internal Audits – Conducted by the Project Control and Internal Audit teams.
Annual External Audits – Conducted by government and third-party auditors (ISO, KSA regulators, PIF project auditors).
Risk-Based Audits – Focused on high-risk compliance areas, including contracts, financials, and safety.
4.2 Regulatory Risk Management
BEC Arabia maintains a Regulatory Compliance Risk Register, categorizing risks by impact and mitigation priority.
Regulatory Risk
Risk Level
Mitigation Strategy
Non-compliance with FIDIC contracts
High
Implement variation approval workflow
Delay in government permits
High
Ensure pre-approval process for key activities
WPS salary processing violations
Medium
Automate payroll tracking & compliance
HSE safety violations
High
Conduct frequent site inspections
4.3 Compliance Key Performance Indicators (KPIs)
Contract Compliance Rate (%) – Measures adherence to FIDIC & legal terms.
Regulatory Audit Pass Rate (%) – Tracks successful regulatory audits.
Project Financial Compliance Index – Ensures budgets meet legal requirements.
Safety Compliance Score (%) – Monitors adherence to HSE standards.
5. Conclusion
The 360° Compliance Approach in Project Control at BEC Arabia ensures regulatory alignment across contracting, procurement, cost control, risk management, and execution. This integrated compliance system:
Prevents legal and financial risks through proactive monitoring.
Ensures transparency and audit readiness for government and regulatory bodies.
Supports seamless project execution while maintaining contractual, financial, and safety integrity.
By embedding compliance at every phase of project execution, BEC Arabia upholds its reputation as a market leader in KSA's mega construction industry.
This document now serves as the foundation for Project Control Compliance and Regulations at BEC Arabia. Let me know if refinements are needed before proceeding with detailed Project Control Policies, Procedures, Risk Management, and KPIs.
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