If you're thinking about starting your project and opening your company in Saudi Arabia, it's not as complicated as you might think!
Here, we’ll walk you through the Saudi Arabia company registration process step by step in a simple and clear way.
Choose Your Company Type and Get the MISA License
When you want to start your project in Saudi Arabia, choosing the type of legal entity and obtaining the MISA license are the most important steps at the beginning of the journey.
We will explain to you clearly and simply the different types of entities you can choose from, as well as the steps to submit the company establishment file and the required documents to get the Saudi Ministry of Investment license easily and within a reasonable time.
Different business structures are available to set up your company
When you want to start your company in Saudi Arabia, the most important thing to understand is the type of legal entity you will register, there are several types you can choose from:
- An LLC: is the go-to option for many small and mid-sized businesses in Saudi Arabia. It’s simple to run and limits each partner’s financial responsibility to the amount they invested.
- Branch of a foreign company: If you have a company outside Saudi Arabia and want to open a branch here, this is the appropriate entity type, a branch office operates under the parent company and follows its direction, with the main company handling full responsibility.
- Joint Stock Company (JSC): This is for large companies that may have a large number of shareholders, and the shares are tradable, it involves somewhat bigger incorporation procedures, but it is suitable if you plan to expand significantly.
Read also: Types, Costs & How to Get a Saudi Business License Easily.
Steps to submit the master file and your plans to MISA and get approval
After you determine the type of entity, you need to start submitting the company establishment file and the required documents to the Saudi Ministry of Investment (MISA) to get the license that allows you to officially operate in the Saudi market. These steps take from 1 to 3 weeks, which include:
- Preparing the master file that contains all company details: name, activity type, ownership structure, and any required legal documents.
- Submitting the file on the Ministry of Investment platform and submitting business plans that explain the company’s objectives and how it will operate.
- Waiting for approval and review from the ministry, which might take some time depending on the completeness and accuracy of the file.
Reserving the Name via the Ministry of Commerce Website
The very important first step when starting to establish your company in Saudi Arabia is reserving the company name. The process is simple but you need to pay attention to some points so the name isn’t rejected and complies with the Ministry of Commerce’s rules.
You can easily reserve your company name through the Saudi Ministry of Commerce’s website, which allows you to choose a unique and unused name before proceeding with the rest of the procedures.
Important Tips to Avoid "Prohibited Terms"
There are some words and terms forbidden to use in the company name to avoid problems or rejection from the ministry. For example:
- Stay away from terms that might touch on political or religious sensitivities when choosing your business name.
- Words that might cause confusion or deceive customers.
- Duplicate names or names similar to existing companies.
- Use of inappropriate or terms violating public order.
Notarize Legal Documents (Articles of Association)
As part of the Saudi Arabia company registration process, when you come to establish your company in Saudi Arabia, it’s not enough just to submit papers and fill out forms. You also need to officially notarize important legal documents like the Articles of Association to ensure they are recognized within the Kingdom.
Notarization steps
There are specific steps to do that:
- Notarization at the Saudi Embassy in Dubai: The first thing you do is take the documents to the Saudi Embassy in Dubai to get them officially notarized. This confirms that these papers are trustworthy and legal.
- Attestation from the Saudi Ministry of Foreign Affairs: After the embassy notarizes the documents, you need additional attestation from the Saudi Ministry of Foreign Affairs, this attestation further supports the documents and makes them fully recognized inside Saudi Arabia.
Commercial Registration (CR) and Registrations
When you finish notarizing your company’s official documents, the next important step is commercial registration, which is an essential step to legally operate in Saudi Arabia.
Steps for Commercial Registration
- Register with the Ministry of Commerce: The first thing you need to do is register your company with the Saudi Ministry of Commerce. This registration grants you the official Commercial Registration (CR) certificate, which proves that your company is registered and recognized.
- Once your registration form is submitted, the next step is to settle the official fees to move forward, These fees vary depending on the company type and size, and you must make sure to pay them so your application is not delayed.
- Obtain the Commercial Registration (CR) certificate: After completing all procedures and paying the fees, you will receive the CR certificate, which is the official document that gives your company the right to operate and deal with government entities and clients.
Important Governmental Registrations
Besides registering with the Ministry of Commerce, there are other registrations you need to complete to ensure your company operates legally:
- General Authority of Zakat and Tax (ZATCA): You must register your company with the authority to pay Zakat and taxes officially.
- General Organization for Social Insurance (GOSI): If you have employees, you need to register them with social insurance to ensure their rights and the company’s rights.
- Municipality Registration: For some businesses and commercial activities, you need to have a permit from the municipality depending on the type of activity.
Open Bank Account and Deposit Capital
Opening a bank account is an essential part of setting up your Saudi Arabia company registration process. It allows you to manage your company’s finances legally and officially, and also to deposit the required capital according to business regulations.
Main Banking Programs
In Saudi Arabia, there are several banks offering programs dedicated to businessmen and new companies, including:
- National Commercial Bank (NCB)
- Riyadh Bank
- Aljazira Bank
Each bank offers different packages for company accounts, like current accounts, savings accounts, and electronic services that facilitate account management.
Expected Time to Open the Account
According to Economy Middle East website, opening the company’s bank account takes from 2 to 4 weeks, this duration depends on how fast the required documents are prepared and the data verification process.
Tips to Save Time and Fund the Account Activation from the UAE
If you are in the UAE and planning to open a company in Saudi Arabia, you can start preparing and funding the bank account from there before traveling:
- Prepare all the official company documents, and copies of ID or residence.
- Communicate with the bank in Saudi Arabia electronically to know the required procedures.
- Transfer the required capital amount in advance from your account in the UAE to ensure quick activation.
- Use the Saudi banks’ electronic banking services that allow managing the account from abroad.
Obtain Sector and Local Permits
When you register your company in Saudi Arabia, it’s not just about registering with the Ministry of Commerce, you also need to obtain permits specific to your business activity. These permits vary depending on the type and nature of your business, so it’s important to know all the details to follow the right steps.
Differentiating Permits by Activity
In Saudi Arabia, there are several authorities that issue permits based on the type of activity, and the most important are:
- Municipality: If your activity is related to buildings, shops, restaurants, or any activity affecting the local environment, you must obtain a permit from the municipality. This ensures the place is safe and ready for operation.
- General Authority of Zakat and Tax (ZATCA) – VAT: If your activity is subject to VAT, you must register with this authority to be able to pay the tax and deal with the tax system in Saudi Arabia officially.
- Saudi Arabian Monetary Authority (SAMA) – Banks and Financial Institutions: If your business is related to banks, insurance companies, or any financial activity, you must have a permit from SAMA to ensure compliance with financial laws.
- Saudi Food and Drug Authority (SFDA): If your activity concerns food, medicine, or health products, you must obtain a permit from SFDA to ensure the safety and quality of the products.
A new law was introduced to make the registration process easier
There is important news: a new law was issued on October 4, 2024, which will be applied from April 2025, aimed at facilitating and simplifying the procedures for registration and obtaining governmental permits.
This law will make procedures faster and easier, reducing the complications that new companies face, especially regarding sectoral and local permits.
Employ Staff and Saudization Compliance
When you go through the Saudi Arabia company registration process, it’s not just about completing the paperwork — you’ll also need to think about hiring the right people and managing your team properly.
One key part of that is Saudization, a requirement from the Ministry of Labor that makes it essential to employ Saudi nationals as part of your workforce.
Registration in GOSI
The first thing you need to know is registration in the General Organization for Social Insurance (GOSI). This registration is necessary so that employees are covered by health, social, and legal insurance.
That means any employee working with you must be registered in GOSI, and this helps protect their rights and also helps the company comply with the laws.
Saudization Policy
Saudization means employing a certain number of Saudi citizens in the company, and this is a demand from the Ministry of Human Resources and Social Development in Saudi Arabia.
Its goal is for Saudis to get suitable job opportunities instead of relying completely on foreign labor.
The Ministry of Labor determines specific percentages according to the type of activity and company size, and you must monitor these percentages so the company does not face fines or legal issues.
Ministry of Labor Follow-Up
The Saudi Ministry of Labor continuously monitors companies' commitment to Saudization and conducts regular inspections. Also, there are reports you must submit about the number of Saudi employees and their conditions.
If you don’t comply with the requirements, the company might face penalties such as fines or even suspension of activities.
Tips for Those Wanting to Employ a Saudi Team from the UAE
If you are in the UAE and intend to form a Saudi team in Saudi Arabia, here are some tips to help you:
- Choose Saudi employees who have experience and preferably are well-trained: This helps them integrate quickly into the work team.
- Provide them with training and development programs: So they feel part of the company and that you care about developing their skills.
- Be flexible with employment conditions: Like working hours and allowances, especially if you hire employees from different regions.
- Constantly follow updates from the Ministry of Labor: To know any changes in Saudization percentages or new regulations.
- Use local consulting office services: If you are unsure about procedures, these offices will help simplify the process.
Read also about: Starting UAE Business in Saudi Arabia Now!
Start Your Company in Saudi Arabia with Motaded and Make Every Step Count from Day One!
If you’re looking to start a business in Saudi Arabia but don’t know where to begin or feel overwhelmed by the process, Motaded is your go-to partner. From legal consultations to full company registration, the team is ready to guide you step by step, saving you time and effort.
Start now and contact Motaded’s experts at:
- [email protected]
- +966 53 979 7197
Don't let your business dream wait any longer!
FAQs About Saudi Arabia Company Registration Process
Is it necessary to have a physical office in Saudi Arabia?
Yes, you must have an official address. But if your activity is “digital or service-based,” you can start with a virtual office temporarily, depending on the sector.
How long does company setup take?
Time varies depending on the type of company and documents, and it usually takes 1 to 3 months if everything is complete and correct.
What is the approximate cost of setting up a company in Saudi Arabia?
Cost varies depending on the company type and services needed (typically from 5,000 to 30,000 SAR), and includes registration fees, Chamber of Commerce, and official announcements.