Saudi Arabia is rapidly emerging as a hotspot for global business and investment. With eyes turning toward its expanding market, many are asking: can foreigners really set up shop and succeed here? In this guide, we’ll answer that question clearly and comprehensively.
Can Foreigners Do Business in Saudi Arabia?
Yes, Absolutely. Thanks to major governmental reforms launched in 2016 under Saudi Arabia’s Vision 2030, foreigners can now do business in the Kingdom with full ownership and control. These reforms allow non-Saudis to establish and run their businesses without the need for a local partner.
No matter where you're from, you can set up a new business or open your own company in one of Saudi Arabia’s free zones and grow in one of the most promising environments for business, trade, and economic development in the world.
Before taking your first step, it’s crucial to understand the essential requirements, whether financial, legal, or procedural, as well as to choose the most promising business field for the future.
Advantages of Doing Business in Saudi Arabia for Foreigners
Saudi Arabia offers a wide range of benefits for foreign entrepreneurs and companies looking to invest in the region. Here are the top advantages:
1. 100% Foreign Ownership
Thanks to Vision 2030 reforms, foreign investors can now own and operate businesses in Saudi Arabia without the need for a local partner — a significant shift that encourages full control and profit retention.
2. Strategic Global Location
Located at the crossroads of Asia, Europe, and Africa, Saudi Arabia offers a prime geographical position for trade, logistics, and business expansion into other key markets.
3. Pro-Business Regulatory Environment
The Saudi government has significantly reduced bureaucratic hurdles, making business registration faster and more transparent through digital platforms like MISA, Qiwa, and ZATCA.
4. Tax Incentives and Free Zones
Investors in designated special economic zones benefit from reduced corporate tax, customs exemptions, and streamlined import/export processes — boosting profitability.
5. Large and Growing Market
With over 35 million people and a young, tech-savvy population, Saudi Arabia offers a strong consumer base across various sectors, including retail, healthcare, education, and e-commerce.
6. Government Grants and Support
Foreign investors in key sectors (e.g., renewable energy, ICT, tourism) may qualify for government-backed incentives, funding programs, and public-private partnership opportunities.
7. Access to Major Projects and Giga-Projects
Saudi Arabia is home to multi-billion-dollar initiatives like NEOM, The Red Sea Project, and Qiddiya, which offer investment opportunities in infrastructure, hospitality, energy, and innovation.
8. Stable Economic and Political Environment
As the largest economy in the Middle East, Saudi Arabia boasts a stable currency, vast natural resources, and a clear roadmap for economic diversification under Vision 2030.
Requirements to Start a Business in Saudi Arabia for Foreigners
Foreigners can now fully own and operate businesses in Saudi Arabia, thanks to the Kingdom’s pro-investment reforms. However, to do so legally and smoothly, you must meet several legal, financial, and procedural requirements. Here's a clear breakdown:
Legal Requirements
These are mandatory regulations enforced by Saudi authorities. You must comply with them to legally run a business as a foreigner:
1. Foreign Investment License (MISA)
Every foreign investor must obtain a license from the Ministry of Investment of Saudi Arabia (MISA). Without it, foreign business ownership is not permitted.
2. Commercial Registration (CR)
Issued by the Ministry of Commerce, this is your official business license. It's legally required to start any business operation.
3. Defined Business Activity
Your chosen business activity must be listed under approved sectors. Some industries are fully open to foreigners; others may need additional approvals.
4. Municipality License (Baladiya)
Required to legally operate your physical office or store. It confirms your location complies with local regulations.
5. Saudization Compliance (Nitaqat Program)
By law, your company must hire a minimum number of Saudi employees depending on your sector and business size.
Financial Requirements
These are the monetary obligations you’ll need to fulfill before and during the setup:
1. Minimum Share Capital
Some business structures, such as a 100% foreign-owned LLC, require a minimum capital—usually SAR 500,000 or more depending on the activity.
2. License and Government Fees
MISA license fees, registration costs, and local municipality fees apply. These can vary by business type and location.
3. Office Lease Costs
Renting a physical office is mandatory. Virtual offices are not accepted for licensing purposes.
4. Employee Salaries and Insurance
Budget for hiring Saudi and non-Saudi staff according to labor laws and mandatory health insurance contributions.
Procedural Requirements
These are steps and documentation needed to complete the process, even if they’re not laws by themselves:
1. Authenticated Legal Documents
This includes:
- Passport copy
- Power of attorney
- Company incorporation certificate
- Articles of association
- Audited financial statements (if expanding an existing company)
- All documents must be notarized and legalized in your home country and by the Saudi Embassy.
2. Saudi Bank Account
Once you receive your CR, you’ll need to open a corporate bank account to deposit your share capital and handle operations.
3. Office Address
A confirmed business address in Saudi Arabia is required for the registration process and license issuance.
4. Online Government Portal Registration
You’ll need to register with systems like Qiwa, GOSI, ZATCA, and Mudad to manage labor, insurance, tax, and wage protection.
Top 7- Business Sectors for Foreign Investors in Saudi Arabia
1. Information Technology and Cloud Services
Saudi Arabia is rapidly transforming into a digital economy, making Information Technology and Cloud Services a top sector for foreign investors. With government support for smart cities, digital banking, and cloud infrastructure, the Kingdom offers immense opportunities for tech startups and IT service providers.
2. Tourism and Hospitality
As part of Vision 2030, Saudi Arabia is investing heavily in its tourism sector to attract 100 million visitors annually by 2030. This opens the door for foreign investors in tourism and hospitality, including hotel chains, travel tech, entertainment services, and cultural tourism ventures.
3. Logistics and Transportation
Located at the crossroads of three continents, Saudi Arabia is becoming a global logistics hub. Foreign businesses in logistics and transportation benefit from advanced infrastructure, new free zones, and major investments in railways, shipping, and e-commerce delivery networks.
4. Renewable Energy and Green Projects
Saudi Arabia is committed to sustainability through massive investments in solar, wind, and hydrogen energy. Foreign investors in renewable energy can partner with national projects like NEOM and contribute to the Kingdom’s shift toward a low-carbon economy.
5. Healthcare and Pharmaceuticals
With a growing population and rising demand for modern healthcare, Saudi Arabia offers high potential for foreign investors in healthcare and pharmaceuticals. Opportunities exist in hospital management, biotech, telemedicine, and pharmaceutical manufacturing.
6. Manufacturing and Industrial Services
The Kingdom aims to localize production and reduce import dependency, creating attractive opportunities for foreign investment in manufacturing and industrial services. Priority areas include automotive, electronics, food processing, and advanced materials.
7. Education and E-learning Platforms
The education sector is undergoing digital transformation, creating demand for foreign-led e-learning platforms and educational services. From K-12 innovations to corporate training and EdTech solutions, investors can tap into a fast-growing and under-served market.
Read about: How to Open a Foreign Company Branch in Saudi Arabia
10-Steps to Set up a Business in Saudi Arabia for Foreigners
Setting up a business in Saudi Arabia is now more accessible for foreigners. Here's a clear step-by-step guide to help you get started:
Choose your business activity based on the approved list by Saudi authorities to ensure it qualifies for foreign ownership.
Choose your business structure, as it affects your licensing process, capital requirements, and legal responsibilities. Common business structures in Saudi Arabia include: limited liability company (LLC), joint stock company, branch of a foreign company, sole establishment (under specific conditions), and limited partnership.
Apply for the MISA investment license through the Ministry of Investment with the required documents.
Legalize and translate your documents, such as company registration and financial statements, into Arabic and authenticate them.
Register your company with the Ministry of Commerce and obtain your Commercial Registration (CR).
Open a corporate bank account in a Saudi bank and deposit the required share capital if needed.
Lease a physical office location, as a real business address is mandatory for licensing.
Obtain the municipality license (Baladiya) to operate legally within the city.
Register on essential government portals including ZATCA, GOSI, Qiwa, and Mudad for taxes, insurance, and labor management.
Hire employees and ensure you meet the Saudization (Nitaqat) quota depending on your business type.
How Much Does It Cost to Start a Business in Saudi Arabia as a Foreigner?
The cost of starting a business in Saudi Arabia as a foreigner depends on the type, size, and structure of the business. Below is an estimated cost breakdown:
- MISA Investment License Fee
Approximately $530 to $2,700 depending on business activity. - Commercial Registration and Municipality License
- Commercial Registration (CR): $320 to $530 per year
- Municipality License (Baladiya): $270 to $1,600 annually, depending on city and office size
- Office Lease
- Small office in a business area: $5,300 to $13,300 per year
- Premium office in cities like Riyadh or Jeddah: $26,600 or more annually
- Minimum Capital Deposit
For a 100% foreign-owned LLC, a minimum capital of around $133,000 may be required. This is not a fee but a required deposit into a Saudi bank account. - Legal and Translation Fees
Estimated at $1,300 to $4,000 for document authentication, notarization, and certified Arabic translation. - Other Setup Fees
Includes company stamp, Chamber of Commerce membership, and online service registration: $530 to $1,330 - Ongoing Costs
Salaries for Saudi and non-Saudi employees, Saudization-related costs, VAT registration if revenue exceeds SAR 375,000 (approx. $100,000), and annual tax filing (15% VAT and 20% corporate tax for foreign companies).
Estimated Total Initial Setup Cost:
- For a basic business setup: $16,000 to $27,000 (excluding share capital)
- For a premium setup with full services: $40,000 to $66,000 or more
Figures are approximate and may vary depending on the activity and official updates.
Ready to Start 100% Owned Business in Saudi Arabia?
Looking to do business in Saudi Arabia and tap into one of the fastest-growing economies in the world? Contact Motaded today for expert guidance, end-to-end support, and a hassle-free business setup process.
How Motaded Helps Foreigners Start a Business in Saudi Arabia
Motaded specializes in helping foreign entrepreneurs and investors successfully establish their businesses in Saudi Arabia.
From securing the MISA investment license to completing commercial registration, we handle every legal and procedural step on your behalf.
Our team ensures full compliance with Saudization regulations, assists in selecting the best business structure, arranges office leasing, and supports bank account setup.
With deep local expertise and a streamlined process, our experts make it easy for non-Saudis to launch and grow their ventures in the Kingdom—with 100% ownership and zero hassle.
FAQ About Can Foreigners Do Business in Saudi Arabia
Can you open a business in Saudi Arabia as a foreigner?
Yes, foreigners can open a business in Saudi Arabia with full legal ownership, thanks to Vision 2030 reforms and support from the Ministry of Investment (MISA).
Can I get residency in Saudi Arabia if I open a business?
Yes, foreign investors can apply for an Investor Residency Permit, allowing them to live in Saudi Arabia, sponsor family members, and operate without a local sponsor—depending on the residency type and investment size.
Who can do business in Saudi Arabia?
Any qualified foreign individual or company can do business in Saudi Arabia by obtaining the required investment license, meeting capital requirements, and following legal procedures.
What are the legal requirements to open a business in Saudi Arabia as a foreigner?
Foreigners must obtain a MISA license, register with the Ministry of Commerce, lease a physical office, and comply with Saudization and tax regulations.
How much does it cost to start a business in Saudi Arabia for foreigners?
Startup costs typically range from SAR 60,000 to SAR 250,000 depending on the business activity, structure, and location—excluding share capital.
What business sectors are open to foreigners in Saudi Arabia?
Key sectors include IT, tourism, logistics, healthcare, education, and renewable energy—many with 100% foreign ownership allowed.
Can I start a small business in Saudi Arabia as a foreigner?
Yes, small businesses can be started by foreigners as long as they meet licensing, capital, and Saudization requirements.
How to start a small business in Saudi Arabia?
To start a small business in Saudi Arabia, choose your activity, apply for a MISA license, register with the Ministry of Commerce, lease an office, and fulfill Saudization and tax requirements.
Do I need a Saudi partner to start a business in Saudi Arabia?
No. In most sectors, you can fully own your business without a Saudi partner, though some strategic industries may require special approval.
Can a foreigner buy an existing business in Saudi Arabia?
Yes, foreigners can acquire existing companies, subject to due diligence, license transfer, and regulatory approvals.