Thanks to continued reforms in Saudi Arabia’s market over the recent years, non-Saudis can now own businesses in Saudi Arabia if they have met all the requirements.
Welcoming foreign investments is part of Saudi Arabia’s Vision 2030 — a government strategic plan to reduce the country’s reliance on oil, diversify the kingdom’s economy, and develop a strong private sector. The Saudi government believes that removing the foreign trade barriers that existed will open up the country to the world, positioning the country as a major player on the world stage.
However, if you want to have a successful business in Saudi Arabia, there are some key things that you should know, including:
- Types of Business You can open in Saudi Arabia
- The process for opening a business in Saudi Arabia
- Requirements for establishing a company in Saudi Arabia
Types of Businesses You Can Open in Saudi Arabia
Like most western countries, there are several types of business entities in Saudi Arabia, including:
- Limited liability company
- Joint Stock Company
- Private companies
- Limited partnership company
- Joint venture
- Joint liability company
Due to the varying registration formalities, it is always advisable to obtain local legal advice when opening any of the above businesses.
Requirements to Own a Company in Saudi Arabia as a Foreigner
If you already own a company in your home country or any other part of the world, opening a branch in Saudi Arabia can be easier for you if you can prove that your business has been operational for more than 12 months and produce your company’s audited financial statement for not less than a year.
However, an entrepreneur with intellectual property rights from internationally recognized entities can start a company in Saudi Arabia even if they lack an existing company. The Saudi government will only issue you with an investment license to own a company in the country if you have met these requirements.
The Process of Starting a Company in Saudi Arabia
If you have met all the above requirements, you can start the process of opening a business. Below are the steps to follow.
- Prepare all the required documents and issue them to the Saudi consulate
- Apply for a company investment license to the Saudi Arabia Ministry of Investment.
- Get the Ministry of commerce and industry’s approval after submitting the Articles of Association and your company’s name.
- Sign the Articles of Association before a notary public.
- Have the articles of Association and business name published in the official gazette.
- Open a Saudi bank account and deposit the share capital to get a certificate that states you have deposited the capital.
- Register with the Ministry of interior, General Department of Passports and Ministry of Labour for residence/work visas for your foreign workers.
- Register with the Local Chamber of Commerce.
- Register with the country’s Finance Ministry and the Department of Zakat and Income Tax to get a certificate of business commencement.
- Get registered with the General Organization of Social Insurance.