Limited Liability Company in Saudi Arabia

Entrepreneurs wanting to start their business in Saudi Arabia, a limited liability company is a great option to consider. It’s one of the most common forms of business. The LLC can be started with one shareholder and one director.

Contents

  1. Benefits of Setting up a Limited Liability Company in Saudi Arabia
  2. How to Start an LLC in Saudi Arabia?
  3. Types of Business Entities in Saudi Arabia
  4. Seek Professional Assistance

Let us deep dive into the details of a limited liability company in Saudi Arabia.

Benefits of Setting up a Limited Liability Company in Saudi Arabia

Here are the benefits of setting up a limited liability company in Saudi Arabia:

  • Strategic Location

Saudi Arabia’s strategic location makes it a great place for investors and entrepreneurs to set up their businesses. The nation acts as a bridge between Asia, Europe and Africa.

  • Booming Economy

Saudi’s booming economy attracts people from all around the globe. The key drivers of this economy are the energy, petrochemical, manufacturing and technological sectors.

  • Government Support

The Saudi government has brought extensive diversification to attract investors from all over the world. One such initiative is the Saudi Vision 2030, which aims to diversify the economy.

  • Tax Benefits

Saudi Arabia is offering tax exemptions and amazing incentives. These include exemptions in many special economic zones in Saudi Arabia.

  • Access to the Global Markets

With its huge population, Saudi Arabia has open access to the never-ending demands of the global market.

How to Start an LLC in Saudi Arabia?

Starting an LLC in Saudi involves several steps:

  1. Market Researching

This is the first step one should take before entering into the market. 

  • Analyse the competitors
  • Understand your target audience
  • And also study the legal regulations.

It is a mandatory step. Without this, it will get hard for you to set up your LLC company.

  1. Selecting a Business Activity

Decide your business activity as per your requirements. But before finalizing, it is important to ensure the chosen activity is aligned with Saudi’s rules and regulations.

  1. Deciding a Trade Name

Any business requires a trade name which adheres to the legal regulations of the nation. Keep these points in mind while picking your business name:

  • Avoid selecting offensive names.
  • Avoid selecting religious and deity names.
  • Names shouldn’t be used by other companies.
  • Avoid selecting the names of any famous brands.
  • Select the name that represents your business activity.

  1. Preparing the MOA

Draft the MOA (Memorandum of Association). It should contain details like:

  • Share capital
  • Your company’s objective
  • Information about all the shareholders
  • Administration structure of the company

  1. Securing required Approvals

Get all the approvals from relevant authorities. Especially from the Ministry of Investment for Foreign Investors.

  1. Notarising the MOA

Get the MOA notarised by the Saudi notary or any other competent authorities.

  1. Opening a Corporate Bank Account

Open a corporate bank account from a reputed bank as per your requirements. And obtain the bank certificate as evidence.

  1. Registering with the Ministry of Commerce and Investment 

Finish the registration with the Ministry of Commerce and Investment with all the required documents.

  1. Additional Approval

Check all the requirements and get the additional approvals if needed as per the business activity you have chosen.

  1. Commercial Registration

Complete the commercial registration process with the Ministry of Commerce and Investment. Then get the commercial registration certificate (CR) and the tax card.

Types of Business Entities in Saudi Arabia

There are a few more business structures other than the LLCs for business setup in Saudi Arabia:

  • Limited Liability Company

An LLC in Saudi Arabia is the best option for people who want to incorporate a small or medium-sized business. Saudi LLC offers limited liability protection to all shareholders.

This can be started with at least 2 shareholders.

  • Joint Stock Company (JSC)

This business structure requires 5 shareholders. And this one is for larger companies and for those planning to go public.

  • Branch Office

Branch offices are those which are set up in Saudi with its parent company in some other nation. It is set up for conducting specific business activities under the name of the parent company.

  • Representative Office

This business structure is ideal for those wanting to explore the Saudi market and are not willing to engage in any commercial activity.

Seek Professional Assistance -

This article explains the intricacies of a Saudi limited liability company. If you want experienced business setup consultants to answer your queries about LLC companies, you should contact Commitbiz. You can book a free call with us and get answers to your questions.

Setting up a company in Saudi Arabia is a great way to grab the benefits of operating in a growing economy. And a limited liability company is a great option for you.

If you want to start your entrepreneurial journey today, connect with Commitbiz now.