A group of people creating a plan for setting up a company in Saudi Arabia

Simplified Guide for Setting up a Company in Saudi Arabia

by Priyadarshini Balamurugan 27, Feb 2024

Setting up a company in Saudi Arabia can be a dream for someone, and now that has become so convenient for the Saudi government after the introduction of business-friendly policies. However, a foreign investor or an entrepreneur needs to follow a few procedures as per the rules and regulations set by the authorities.

This write-up will introduce you to the dos and don’ts of setting up a company in Saudi Arabia. If you are someone who is looking to incorporate your business in this economically growing nation, you have landed at the right place that can guide you to your dream destination.

Do's of Setting up a Company in Saudi Arabia

Here are some of the things you should do for setting up a business in Saudi Arabia:

  • Apply for an Investment License

The very first step of business setup in Saudi Arabia is to get the investment license from SAGIA - Saudi Arabia General Investment Authority. This is a mandatory 

license to incorporate a business in KSA.

The process starts with submitting an application form to SAGIA. The documentation/ paperwork can be done both online and offline as per your requirements. 

SAGIA will provide you with a unique number that you will need to register your business and get certified by the chamber of commerce.

The above-mentioned certificate is required for you during the time of business setup in KSA and also while you try to open a corporate bank account for your business.

  • Notarise the Company Documents

Document notarisation is mandatory for setting up a business in Saudi Arabia. Now, this can be done online just to save you time and money.

The document notarisation should be done once the AoA is ready and approved by the relevant authority.

Below is the list of documents you need to keep ready for notarisation:

  • Approved AoA document.
  • License copy from SAGIA.
  • Colour photographs of all shareholders and directors.
  • A conscience is signed by all the shareholders and directors.
  • Passport copies and ID proofs of all the shareholders and directors. 
  • All corporate documents, including the documents related to all the shareholders.
  • Gazette Publication

The next important step for setting up a Saudi Arabia business is the official gazette publication that should have all the information about:

  • All Approval Certificates from relevant authorities.
  • The name of the company.
  • AoA information.
  • Open a Corporate Bank Account

A corporate bank account is mandatory for any business for financial management. Setting up a company in Saudi Arabia required a bank account to transect government fee submission in all the company setup processes.

  • Rent/ Lease and Office Space

Saudi business setup requires an office space for showing your corporate address and fulfilling many corporate needs. 

Once you have an office space, you are eligible to obtain a municipal license, which is a compulsory process for setting up a business in Saudi Arabia.

  • Obtain a Commercial License

This is the final thing to be done. Compile all the documents and approvals obtained so far and submit them to the Commercial Registry Department of the Ministry of Commerce and Industry in Unified Center, KSA.

This final approval from the authority will make your company legal in Saudi, and you can start your business activity after obtaining the approval.

Note: After finishing all the procedures, there is one more mandatory thing to be done is obtaining membership registration from the Chamber of Commerce. This will be needed in the future for any legal issues or for any upgrades.

Points to be noted before Setting Up a Business in Saudi Arabia

The following is the list of things you should not avoid noticing before setting up a company in Saudi Arabia:

  • Avoid skipping any regulations.
  • Never disrespect any of their religious beliefs.
  • Understand the local market, and never underestimate it.
  • Try not to ignore Saudi's cultural sensitivity. Always respect it.
  • Don't rush into any business deals; think before involving yourself in any deal. Or you can always contact experts to get guidance.
  • Try not to ignore local customs and legal regulations. Be in a good rapport with local customs.

Saudi Business Visa Cost

Saudi business visa cost is completely dependent on the type of business and the business activity you choose to be involved in. 

Your office space also matters here as the size of your business. So, the visa cost can be determined only as per the requirement.

Why Choose Us to Set Up a Company in Saudi Arabia?

The simple answer is the expertise we have will guide you in setting up your company. Hold hands with Commitbiz and take a back seat; the rest will be taken care of by our experts.

FAQs

What are the different business entity types available in Saudi Arabia?

  • Limited Liability Company (LLC) - Most commonly, it requires a local sponsor for certain activities.
  • Joint Stock Company (JSC) - Suitable for large-scale operations and complex ownership structures.
  • Sole Proprietorship - Limited to certain activities, usually reserved for Saudi nationals.

What are the foreign ownership restrictions in Saudi Arabia?

  • Certain sectors are restricted to 100% Saudi ownership.
  • Most sectors allow up to 49% foreign ownership with a local sponsor.
  • Regulations vary depending on the industry and specific activity.

What are the financing options available for foreign companies?

  • Bank loans (subject to strict criteria and collateral requirements).
  • Joint ventures with local partners.
  • Raising capital through the Saudi stock exchange (limited to JSCs).
  • Securing government grants or incentives (certain sectors).

What are the cultural considerations for doing business in Saudi Arabia?

  • Respect Islamic values and cultural norms, especially regarding dress and gender interactions.
  • Build relationships and trust before rushing into business deals.
  • Understand and adapt to the decision-making process, which can be more time-consuming.
  • Be mindful of working hours and closures during Ramadan and other holidays.

Start your Entrepreneurship Journey Today in UAE from AED 5,760

Commitbiz will help you with every step of your success journey. You can get one-on-one mentorship from our experts and get guidance on how to clear the legal proceedings and grow your business.

Know More