Saudi Arabia has taken a bold and strategic step forward with the introduction of the draft Global AI Hub Law, designed by the Communication, Space & Technology Commission (CST). This pioneering legal framework is part of the Kingdom’s broader ambition to become a global hub for AI innovation and sovereign digital infrastructure. Where many jurisdictions focus on control or containment, Saudi Arabia has chosen a model rooted in interoperability, diplomacy, and legal flexibility.

This AI regulation in Saudi Arabia reflects a growing trend toward regional leadership in digital governance and signals a strategic shift in how cross-border AI deployment may evolve globally.

Hub-Based Jurisdiction: Private, Extended, and Virtual

Unlike the EU AI Act, which categorizes AI systems based on risk levels and imposes stringent compliance obligations on high-risk applications, Saudi Arabia’s draft law centers on jurisdictional design and cross-border cooperation. It introduces a novel structure of AI deployment through Private, Extended, and Virtual Hubs—each governed by distinct operational rules, legal obligations, and enforcement mechanisms. 

In Private Hubs, guest countries operate AI systems on Saudi soil under bilateral agreements while maintaining full legal responsibility. Extended Hubs allow third-party operators under shared oversight, and Virtual Hubs—perhaps the most progressive model—enable CST-approved service providers to host foreign AI systems under the jurisdiction and enforcement of the customer’s home country.

Legal Optionality and Operational Certainty

From my experience advising clients across the GCC on regulatory compliance and digital transformation, this is a landmark development. The law offers a high degree of legal certainty and operational optionality—something often missing in international digital infrastructure projects. It recognizes the need for sovereign control while allowing for legal pluralism, enabling multinational companies and governments to deploy AI solutions in Saudi Arabia without sacrificing their own legal frameworks. 

In a region where data localization, cybersecurity mandates, and regulatory divergence often pose significant hurdles, this is a game-changer.

Flexibility Through Contractual Oversight

A particularly practical dimension of the law is its built-in flexibility. For instance, Virtual Hubs allow foreign entities to deploy and operate AI solutions in Saudi Arabia while maintaining jurisdictional control from their home country—provided they adhere to agreed-upon norms and do not jeopardize the Kingdom’s digital sovereignty. 

Enforcement and oversight are contractually allocated, ensuring that responsibility is clearly defined and risk is manageable. This legal clarity could become a strong draw for enterprises seeking compliant, scalable, and globally consistent AI infrastructure.

Comparing Models: Saudi Arabia vs. the EU AI Act

In contrast, the European Union’s AI Act presents a more rigid framework, applying to any AI system affecting EU citizens and placing compliance liability squarely on the provider, regardless of where the system is developed or deployed. While thorough, it lacks the adaptability required for cross-border infrastructure in diverse regulatory environments.

The UAE’s Agile, Innovation-Led Approach

It is also important to contrast Saudi Arabia’s model with that of the UAE, another key digital player in the region. Rather than implementing a single overarching AI law, the UAE has embraced a principle-based, modular governance approach. 

Since appointing the world’s first Minister of AI in 2017, the country has launched a national AI strategy, issued ethics guidelines, and established multiple regulatory and research bodies such as the UAE AI Office, MBZUAI, and the Advanced Technology Research Council. 

The UAE encourages innovation through “soft law” mechanisms and agile policy-making. This framework is particularly attractive to startups and R&D-driven initiatives, but may offer less legal certainty than Saudi Arabia’s hub-based, treaty-backed model when it comes to international operations and enforceability.

Different Priorities, Shared Vision

Both systems are credible and visionary, but they serve different priorities. The UAE emphasizes acceleration, innovation, and public-private experimentation. Saudi Arabia, on the other hand, focuses on legal clarity, sovereign control, and international alignment. 

Together, they reflect the GCC’s evolving leadership in defining how AI should be deployed, governed, and scaled responsibly.

How TransPerfect Legal Supports AI Regulatory Strategy

At TransPerfect Legal, we see this regulatory evolution as a critical opportunity. As the leading provider of multilingual data review, AI-enhanced legal workflows, and cross-border compliance support, we help public and private sector clients navigate cross-border AI compliance, bilateral hub agreements, and data sovereignty strategies.

Whether you're deploying sensitive legal data across borders or operationalizing AI in high-stakes environments, we offer the tools, expertise, and regulatory insight to ensure you're compliant, efficient, and future-ready.

Saudi Arabia and the UAE aren’t just adopting AI—they’re shaping the global legal architecture around it. We’re proud to be helping clients lead that transformation across the GCC and beyond.

Ready to navigate the evolving AI regulatory landscape with confidence? Contact us to learn how TransPerfect Legal can support your cross-border compliance, multilingual review, and AI-driven legal workflows across the GCC and beyond.