Advancing Responsible AI Innovation A Playbook 2025

CASE STUDY 3 Legal framework for hosting foreign data in Saudi Arabia Fragmented legal frameworks introduce compliance barriers, particularly regarding data sovereignty, limiting a jurisdiction’s ability to attract foreign investment to support AI economic development. In 2025, Saudi Arabia announced a Global AI Hub law that introduces three models to host foreign data within its borders while balancing data sovereignty rights with international cooperation.28 The law enables Saudi Arabia to terminate any arrangement for reasons related to security, sovereignty or diplomacy, with a built-in transition period to facilitate data migration. Key insight Such an approach signals a shift towards territory-sensitive, sovereignty-respecting data infrastructures. New business opportunities are opened, but risks may still need to be assessed by organizations – such as ensuring legal adaptability, technical compliance and risk preparedness in environments where sovereignty-related constraints can rapidly shift regulatory control. Advancing Responsible AI Innovation: A Playbook 14