Starting a business in Saudi Arabia-Process, cost and benefits

Starting business in Saudi Arabia is convenient. The authority introduced policies which made business setup for foreign investors much easier. However, this convenience is easy to achieve only when a foreign investor follows several procedural rules and regulations here.

In this piece of content, we introduces company setup process, cost and benefits in KSA. If you are a potential investor determined to setup your commercial venture in this Arabian nation, this article will be a good guide towards your journey to company incorporation in Saudi Arabia.

Process of setting up a LLC company in Saudi Arabia

Before you get to know the process of corporate setup, you first have to have a brief knowledge on company formations allowed to run in KSA. Typically there are 5 types of company structure, among which an investor can choose the preferred one for putting the investment. These are the types of business formations valid for an investor:

  1. joint liability companies
  2. Limited Partnership Companies
  3. Joint ventures
  4. Joint stock companies
  5. limited liability companies (LLC)

Among these 5 types of corporate formation types, LLC, also known as Subsidiary Company in KSA, is considered the most popular one for foreign investors. Here we will highlight the registration process and cost requisition of a LLC in Saudi Arab.

Steps of a typical LLC formation process in KSA

Step-1: Appeal for Investment License from Saudi Arabia General Investment Authority (SAGIA)

The initial step of business setup in KSA is to obtain an Investment license from the Saudi Arabia General Investment Authority. Without this license a foreign investor cannot establish any corporate venture in KSA.

The whole process can be done by submitting a recommended application form to the SAGIA. The whole paperwork transactions can be carried out online or offline as per the entrepreneurs’ conveniences. Here you will obtain documents, for instance registration details and unique numbers, which will later be needed to get registered and get certified from the Chamber of Commerce.

This certification is mandatory in company incorporation process. Overcoming this step will also open up the door for bank account opening option in KSA; another big requirement in business setup.

Cost for obtaining SAGIA license: 2000 SAR

Step-2: Notarize of company documents

In this step of business incorporation process all business documents has to be properly notarized. Recently the whole process is mostly done online, which saved time and much more convenient for applicant. The notarization has to be completed as soon as company AoA is prepared and approval from the recommended authority. For notarization, following documents must be standby:

  1. Original company AoA document
  2. SAGIA license copy
  3. Signed conscience of all shareholders and company directors
  4. Corporate documents (AoA, incorporation license) of all shareholders
  5. ID card copies, passport copy of at least two company witnesses
  6. Colored photocopy of the director/s and partners.

Cost: No Charge

Step-3: Gazette publication of company details

Another important step of company registration in KSA is the official gazette publications which include all the details of including company name, AoA information, approval certificates etc. All these papers are related to company setup and various departmental approvals.

Cost: The cost starts from 650 SAR and can go up to 5500 SAR

Step-4: Open bank account

A corporate bank account has to be opened to comply with incorporation process in KSA. This account will help to transect government fees submission in various incorporation processes. Moreover, this account will be a means of various financial management and transections related with the new company.

Cost: At least 100,000 SAR need to be the initial deposit for the LLC setup

Step-5: Setup an office premise

Setting up an office premise is highly recommended. It is mandatory to arrange a corporate address of the business when fulfilling the steps for starting business in Saudi Arabia. This step has to be abide because as soon as Office allotment has been fixed, you will be eligible to obtain the municipality license. Obtaining a municipality license is a compulsory part of business incorporation steps in KSA.

Cost: Depends on company requirements   

Step-6: Get commercial certificate

The final phase of starting business in Saudi Arabia is to obtain commercial certificate. All the legal company paperwork and documents obtained so far has to be compiled together for a final submission at the Commercial Registry department of Ministry of Commerce and Industry in Unified center, KSA.

The final verification, approval and processing time is not more than 2 working days. Once the governmental process is done, you will get your commercial certificate. This will finally make your company ready to run in KSA.

Cost: The cost for obtaining commercial certificate can be as low is 0 SAR and can go up to 8100 SAR, depends on company type.

Step-7: Membership registration with the Chamber of Commerce

A membership registration for Chamber of Commerce is an important initiation in company setup in Saudi Arab. Once registered successfully, membership certificate will be obtained. This certificate is necessary in various aspects of company setup and during business running in KSA.

A fees OF 2000 SAR has to be paid for getting the membership certificate. The application and fees have to be submitted in the same building where the Unified center in KSA is situated.

Cost: the official fee for obtaining the Chamber of Commerce membership certificate is 2000 SAR

Cost Summery for LLC formation for foreign investors in Saudi Arabia

The process above have already mentioned expenditures each step of business incorporation undertakes. However, for better understanding, here are the list of average costings for LLC setup in this nation.

  • Company trade name reservation: No charge
  • SAGIA license: 2000 SAR
  • Notarization of company papers: No charge
  • Company gazette publication: 650 SAR - 5500 SAR
  • Bank account opening: No charge (Initial deposit of 100,000 SAR for LLC)
  • Office premises: 4000 SAR – 1500 SAR
  • Commercial certificate: 0 SAR – 8100 SAR
  • Chamber of Commerce membership certificate: 2000 SAR

Benefits of setting up a business in Saudi Arabia

Being the biggest Middle East nation, one of the largest source of oil reservoir and only Arab nation which is a member of G20, KSA has its own package of benefits for foreign investors in contrast to other neighboring Arab nations. Below we have listed out some of the typical benefits of setting up a commercial venture in Saudi Arabia:

  • Business setup process for foreign investors are much convenient and mostly online based, therefore saves time.
  • Secure social and commercial environment which boost business investments and builds confident among investors and clients for better dealings
  • Premium social and infrastructural facility ensures luxury and quality time for investors as well their families during their stay period in KSA.
  •  The government provides various tax rebates, tax supports, duty free goods transection facilities and free zone facilities to investors in this country. Moreover, investors can get huge benefits and financial incentives if the company facilitate national interests of the nation.
  • Commercial spaces are well furnished and equipped with world class furniture, amenities and facilities. 
  • KSA is situated at the strategic global position, where commercial transactions from both east and west can be carried out with much ease and convenience.

Why LLC in Saudi KSA?

  • In Saudi Arabia Limited liability company can be started with only one shareholder and one director
  • The liability if arises is limited to company’s capital and doesn’t affect personal assets of the owner or shareholders of the company.
  • This type of company formation is the typical way to entering into the joint venture companies in Saudi Arabia.
  • LLC can deal with projects that work both at the private and public level in KSA.
  • The LLC in Saudi Arabia can sponsor multiple employees for residency and can provide employment facilities to many at the private level.

Read Also: How to setup a business in Saudi Arabia?


Company Registration Expert Since 2012