Frequently Asked Questions (FAQ)

How long does it typically take to establish a business in Saudi Arabia?

The setup process usually takes between 1 to 3 months, depending on the type of business and the documents required.

What types of business structures are available for foreign entrepreneurs?

The common structures are:

Limited Liability Company (LLC)
Branch of a Foreign Company
Joint Stock Company (JSC)

Each has different requirements and benefits.

Do I need a Saudi partner to start a business in Saudi Arabia?

Not always! Many industries allow 100% foreign ownership, especially for startups under MISA’s Entrepreneur License.

What is the difference between an LLC and a Branch of a Foreign Company?

An LLC is an independent entity with limited liability. A branch directly represents the parent company and must follow additional compliance rules.

Is 100% foreign ownership allowed in Saudi Arabia?

Yes. The Ministry of Investment allows full foreign ownership in various industries, especially under the entrepreneur and foreign investor licenses.

How do I choose the right legal structure for my business in Saudi Arabia?

Consider factors like liability, control, industry restrictions, and future expansion. An LLC is popular for limited liability, while branches are better for brand extension.

Are there any industries or sectors restricted to foreign investment?

Yes, some sectors are reserved for local investment, like oil exploration, military etc.

What are the requirements for registering a branch of a foreign company?

Requirements include:

Last 1-Year Audited Financial Statement
Certificate of Incorporation
Memorandum of Association
Board Resolutions to Open the Branch
Power of Attorney for a Local Consultant

All above documents should be Apostille. For countries not part of the Hague Convention, documents need to be notarized, stamped by the Ministry of Foreign Affairs, and attested by the Saudi Embassy in the parent company’s country.

What is the process for reserving a trade name?

Currently, the trade name can only be booked by a Saudi National. Your consultants on the ground will book the name for you. The Trade Name should be:

In Arabic
Have a meaning in Arabic
Not include country/city names

In some cases, the same Foreign Company name can be booked by your consultants.

What types of licenses are available for foreign-owned businesses?

Key licenses include:

Service License. Example: IT, Tourism, Restaurants etc
Industrial License. Example: Factory, Workshop
Trading/Commercial License. Example: Import/Export, Retail Shop

Each license has unique benefits and requirements.

Can I apply for an Entrepreneur License, and what are the requirements?

The Entrepreneur License is for startups with or without a foreign parent company. To get this license, your startup must receive a recommendation letter from an Approved Incubator/Accelerator/VC by the Ministry of Investment (MISA).

Do I need separate licenses for each business activity?

Yes, if you operate in multiple industries. Each activity may require specific licenses and approvals. For example, a service license won’t cover trading or factory operations.

Is there a minimum capital requirement for foreign businesses?

Most businesses do not require a minimum capital requirement. Startups can begin with as little as SAR 5,000.

What taxes and fees are applicable to foreign-owned companies in Saudi Arabia?

Corporate Tax & Zakat: 20% corporate tax on adjusted annual profits.
VAT: 15% on goods/services if the revenue exceeds SAR 375,000.
Withholding Tax: Ranges between 5% and 20% for payments to foreign entities.

Can I open a bank account before my company is fully registered?

No, a CR and MISA license are required before opening a business bank account.

What documents are required for opening a bank account?

CR (Arabic & English)
MISA Digital License
Articles of Association (AOA)
Activities List (Arabic & English)
Company National Address
Owner’s/Partners’ Iqama ID
Owner’s/Partners’ Passport ID
Owner’s/Partners’ National Address
Company Stamp with CR Number (required by some banks)

Some banks allow to open the bank account online. Read more from this article

Are there any restrictions on transferring profits or funds abroad?

There are no significant restrictions, but tax obligations must be settled before transferring profits.

What are the costs associated with hiring employees in Saudi Arabia?

Costs include:

Visa fees
Medical insurance
Ministry of Labor fees (SAR 9,600 per expat)
Employee salary packages

What visas are available for foreign entrepreneurs and employees?

Visas available :

General Manager (GM) Visa
CEO/Chairman Visa for business owners
Work visas for employees

How do I obtain a General Manager (GM) visa?

After securing your MISA license and CR, apply for a GM visa through the MISA portal. Required documents include passport details, CR, and proof of employment.

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