Thinking about starting a business in Saudi Arabia but feeling lost in all the paperwork? LLC company formation Saudi might sound tricky, but it doesn’t have to be, we’re breaking it down step by step simple, clear, and stress-free.
Main Types of Business Entities in Saudi Arabia
If you’re thinking about setting up a business in Saudi Arabia, it’s super helpful to know the different types of legal entities you can choose from, here’s the types of business entities in Saudi:
Limited Liability Company (LLC)
One of the most popular choices for both locals and foreigners. Your financial risk is only up to the amount you invest, and it’s got flexible management options, plus, taxes are simpler, which makes it extra attractive.
Joint Stock Company (JSC)
Perfect for big projects that want to raise capital by selling shares. Ownership is split into shares that multiple investors can buy, it’s a solid option if you’re planning to get listed on the stock market.
General Partnership
This setup is for two or more people teaming up to run a business, sharing both the profits and the liabilities, it’s based on trust and teamwork, great for smaller or family-run businesses.
Technical and Scientific Services Office (TSO)
This office acts as a local rep for international companies, providing market insights, expert support, and technical help. It's a great way for global companies to boost their reach and customer service in Saudi Arabia.
Establishment
In Saudi Arabia, an "Establishment" covers the whole process of setting up a business, whether it’s a sole proprietorship, partnership, or corporation, it’s basically everything from the initial idea to full operation.
Regional Headquarters (RHQ)
An RHQ is the central hub for a company’s operations in a certain region, it manages activities and decisions for that area, helping multinational companies stay aligned with local and regional goals.
Read also: Why Invest in Saudi Arabia? A Concise Guide for Foreign Investors.
Why Set Up an LLC in Saudi Arabia: 5 Key Reasons to Start Now
Thinking about setting up an LLC in Saudi Arabia? Here's why it's a smart move in 2024.
Setting up an LLC in Saudi Arabia has become a popular choice for many entrepreneurs and investors, here are the top reasons why you should consider starting your business in the Kingdom:
- Strong Economic Growth: With a projected GDP growth of 1.5% for 2024, Saudi Arabia’s economy is thriving, and the non-oil sector is expected to grow by 3% to 4%, creating plenty of new business opportunities.
- Vision 2030 Opportunities: The government’s Vision 2030 plan is driving innovation and infrastructure development, making it easier for new businesses to succeed and tap into a growing market.
- Foreign Investment-Friendly: Saudi Arabia is increasingly open to foreign investors, offering a range of incentives and policies to make it easier to start and run a business.
- Legal Protection: An LLC provides limited liability protection, meaning your personal assets are safe, and your risk is limited to your investment in the business.
- Simplified Process: The LLC registration process is straightforward, especially with the help of experienced consultants who guide you through the paperwork, from tax registration to Ministry of Labor requirements.
All You Need to Know About Setting Up a Saudi Limited Liability Company (LLC)
If you're thinking about launching a business, the Saudi limited liability company is one of the easiest and most popular ways to get started. Here’s a quick look at what it’s all about and how it works under Saudi Company Law.
In Saudi Arabia, setting up a business usually means choosing a legal structure—and the Limited Liability Company (LLC) is a go-to option for many. Why? It’s a flexible setup that also protects your personal assets if the business hits a rough patch.
You’ve got two main options when it comes to setting up an LLC:
- Private LLC – The favorite for most people because it’s faster and way simpler to register.
- Public LLC – More suited for bigger companies planning to raise money from investors.
The Saudi Company Law, which got a big update in 2015 and a few tweaks again in 2018, lays out everything you need to know, here are the basics:
- Your LLC is its own thing legally—separate from you and the other owners.
- You need to sort out a few documents to get registered.
- You must have a physical office address somewhere in Saudi Arabia.
- If there’s any foreign ownership, you’ll need a special license to operate.
- At least one shareholder and one director are required to get things rolling.
- The law also sets some limits on how long your company can operate, depending on the business type.
Learn how to Register Your Company in Saudi Arabia.
How to start an LLC in Saudi Arabia?
Here’s a quick and easy breakdown to help you in LLC company formation Saudi without the stress:
- You can launch the company solo or team up with others, whether they’re people or other companies, the cool part? Your personal money stays safe because the business handles its own debts.
- Each partner’s responsibility is limited to how much cash they’ve put into the company, nothing more.
- when your company gets registered:
- Your commercial registration and company bylaws get officially recorded.
- The company contract is published in the A'mali newspaper.
- Your business gets officially listed with the Ministry of Human Resources and Social Development.
- You’re also signed up with the Zakat, Tax, and Customs Authority to handle taxes and compliance.
- Social Insurance registration is handled.
- Your official business address is set up through Saudi Post (SPL).
- You get subscribed to the Chamber of Commerce based on your company’s location.
How to Easily Complete LLC Company Formation Saudi
If you’re planning to launch your business, understanding LLC company formation Saudi is your first big move, let’s keep it simple, here’s exactly the steps you should follow:
- Head over to the Saudi Business Center platform.
- Select the service to create a limited liability company.
- Click Start Service to begin.
- Choose how many partners are part of your company.
- (Optional) Set the company’s legal status if needed.
- Submit your application to get things rolling.
- Fill in the company’s active period, location, business activities, and main goals.
- Enter full details for each partner.
- Complete the commercial registration info.
- Add your company’s basic data.
- Set up your company’s management details.
- Fill in the company’s contract details.
- Review the final summary of everything before submission.
Read more about: Investment Opportunities in Saudi Arabia.
LLC Company Formation Saudi Conditions
Before you dive into LLC company formation Saudi, it’s super important to know the basic requirements, here’s a quick checklist to make sure you’re good to go!
- If one of your partners is a government body, charity, civil institution, or endowment, they need official papers proving they can join or set up a company.
- Got a business that needs approval from the Saudi Central Bank? You’ll need their license or at least an initial OK before moving forward.
- Any partner that’s a legal entity must have an active commercial registration, no suspended or cancelled records allowed.
- All partners must be at least 18 years old, if someone’s underage, a guardianship document is a must.
- Government employees aren’t allowed to be partners, so make sure everyone’s in the clear.
- For professional companies:
- All partners must hold a valid professional license.
- At least 25% of joint partners must be licensed Saudis.
- The total percentage of licensed partners must hit at least 70%.
Best Company to Help Set Up Your Business in Saudi Arabia?
Thinking about starting a business in Saudi Arabia? You’ll find plenty of companies offering setup services, but if you want things done smoothly and stress-free, Motaded is the partner you can trust.
We don’t just handle paperwork; we guide you through every step, from LLC formation to market entry strategies and getting all your licenses sorted.
Whether you're a local entrepreneur or a foreign investor, we’ve got your back with:
- Fast, hassle-free business setup.
- Full support with Saudi market entry.
- PRO and GRO services to handle the boring admin.
- Expert help with banking, tax, and compliance
What Paperwork and Licenses Do You Need to Get Your LLC Up and Running in Saudi
Getting your LLC company formation Saudi done right means having a few key documents sorted, here’s the basic documents you’ll need before you kick things off.
- If one of your partners is a government body, charity, civil institution, or endowment, you’ll need an official document that proves they have the right to set up or join a company.
- Thinking of Starting a Business That Falls Under Saudi Central Bank Rules? Make sure you’ve got their license in hand before moving forward.
- If your company falls under the “professional” category, every partner must have a valid professional license ready to go.
Company Registration Fee in Saudi for Limited Liability
Wondering How Much It Costs to Register an LLC or Joint Stock Company in Saudi Arabia? Here's the costs so you know what to expect before launching your business.
But Keep in mind these are just the basic registration fees; you’ll have extra costs along the way too, filing everything online is the way to go, it’s quicker and saves you time.
- To register an LLC (Limited Liability Company), the fee is SAR 1,200.
- You’ll also need to pay SAR 1,200 when registering your LLC company name.
- There’s an extra incorporation fee:
- SAR 1,200 if it’s a regular LLC.
- SAR 800 if your company is a branch of a parent company (for example, a branch from Egypt).
A heads-up: Sometimes you might face objections or certain conditions that need to be sorted before everything goes through smoothly.
FAQs About LLC company formation Saudi
What’s the minimum capital needed to start an LLC in Saudi Arabia?
To start an LLC in Saudi Arabia, the minimum capital usually depends on the business and who owns it, for a foreign-owned company, you’ll typically need at least SAR 100,000 (around USD 26,000), this amount could vary, so it's good to check specifics based on your business type.
Can Foreigners Open an LLC in Saudi Arabia?
Absolutely! But before you dive in, you’ll need a Foreign Investment License from the Saudi Arabian General Investment Authority (SAGIA).
What documents do I need to register my LLC?
When registering an LLC in Saudi Arabia, you'll need a few important documents, including:
- The Articles of Association.
- IDs of the shareholders.
- Proof of your business address.
- A business plan (if needed).
- If you’re a foreigner, you’ll need your Foreign Investment License.
How Long Does It Take to Get an LLC Set Up in Saudi?
It really depends on your paperwork and business type, but usually, you’re looking at a few weeks up to a couple of months to get everything sorted.
Let’s get your business off the ground—fast and easy.
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