How to Start Business in Saudi Arabia for Foreigners?

How to start business in Saudi Arabia for foreigners is a question many international entrepreneurs are asking as the Kingdom opens its doors wider to global investment. With the ambitious Vision 2030 roadmap, Saudi Arabia is actively encouraging foreign participation across key sectors such as technology, healthcare, real estate, and more.

For those looking to establish their presence, understanding the legal requirements, licensing procedures, and documentation needed is essential. This guide provides a comprehensive overview of how to start business in Saudi Arabia for foreigners, offering practical steps and insights to help you navigate the process successfully.

How to Start Business in Saudi Arabia for Foreigners?

If you’re a foreign national looking to establish a business in the Kingdom of Saudi Arabia, there are several key steps you must take before officially starting your operations. These include:

• Registering with your home country’s Ministry of Trade and Industry, to ensure your business is properly documented by the relevant authority.
• Opening a local bank account in Saudi Arabia, which is necessary for conducting financial and commercial transactions within the Kingdom.
• Registering with the “Wasel” service through local Saudi authorities. It’s important to note that setting up a Limited Liability Company (LLC) requires a physical office lease — virtual office addresses are not accepted.
• Registering with the visa-issuing authority of the Ministry of Human Resources and Social Development (MLSD), which enables you to legally work in the country.
• Completing the registration process with the General Organization for Social Insurance (GOSI), as social insurance coverage is mandatory for all workers in Saudi Arabia.

How Can a Foreigner Open a Business? Step-by-Step Guide

If you are a foreign investor planning to start a business in Saudi Arabia, there are several critical steps to follow. The process starts with obtaining a business license from the Saudi Arabian General Investment Authority (SAGIA), now operating under the Ministry of Investment Saudi Arabia.

1. Define Your Business Activity and Industry

Start by determining the nature of your business and the industry you intend to enter. This decision will influence whether it’s more suitable to operate in mainland Saudi Arabia or within a free zone. The industry type also dictates the required legal structure and license classification.

Read also: Commercial Registration Saudi Arabia: Key to Legal Business

2. Choose a Physical Location

As of 2023, Saudi Arabia requires foreign businesses to have a regional headquarters within the Kingdom in order to be eligible for a work license. If you’re opening a branch of an existing company, you’ll need to lease office space or partner with a local service agent. New companies can choose to operate in the mainland.

3. Obtain a Business License

All foreign investors must obtain an official business license from SAGIA (now the Ministry of Investment). This license permits foreign ownership, investment in local businesses, and the establishment of new entities or branches. During this stage, it is also advisable to apply for a Commercial Registration (CR) through the Ministry of Commerce.

Check out: How to Invest in Saudi Arabia Safely? 7 Ways for Investment

4. Prepare the Required Documentation

To officially form your business, you must appoint a General Manager and compile the following documentation:

• Verified identity and address details of shareholders and directors.
• Copies of passports for all shareholders and directors.
• Company name reservation or declaration.
• Memorandum of Association (MoA).
• Articles of Association (AoA).
• Bank reference letter.
• A valid business visa, which is mandatory for living and working legally in Saudi Arabia.

The Ministry of Investment in the Kingdom of Saudi Arabia has provided the “Invest Saudi” platform as an official and reliable portal to facilitate all investment-related procedures and provide investors with accurate and up-to-date information. Through this platform, investors can learn more about procedures and how to start business in Saudi Arabia for foreigners.

Required Documents to Begin the Process of Registering a Business in Saudi Arabia

To initiate the process of establishing a company in Saudi Arabia, the following documents are essential:

• Commercial Registration (CR) or Business License issued by the Ministry of Commerce (MOCI), This certificate grants the company legal authority to operate in Saudi Arabia and provides it with the same rights as a Saudi national business.
• Notarized and MOCI-approved Memorandum of Association (MoA) and Articles of Association (AoA).
• Position certificate confirming the appointment of the designated general manager.
• A copy of the designated general manager’s passport valid in Saudi Arabia.

The Promising Industries for Launching a Small or Medium-Sized Business in SA?

Some of the most attractive sectors for SMEs in Saudi Arabia include real estate, education, agriculture, technology, healthcare, luxury goods manufacturing, and construction materials. These industries offer significant growth potential and align with the Kingdom’s Vision 2030 goals for economic diversification.

Starting a business as a foreigner in Saudi Arabia involves multiple key steps, from selecting the appropriate sector to fulfilling licensing requirements. In addition to following the official procedure, expatriate investors must also prepare and submit a comprehensive set of required documents to ensure a smooth registration process.

Learn about: Complete Guide to the employment contract in Saudi Arabia

Conclusion

In summary, how to start business in Saudi Arabia for foreigners involves a clear and structured process that has become more transparent and accessible than ever. With support from the Ministry of Investment and the Invest Saudi platform, foreign investors can now launch and grow their businesses with confidence. Whether you’re exploring opportunities in e-commerce, education, or technology, the Kingdom offers a business-friendly environment for long-term success.

The Etqan Al Mutamayza Law Firm is ready to provide the essential support you need. You can reach their team at the following mobile numbers: +96656113776, +966541110440, +966504315333.

Additionally, feel free to visit our branches located at:

• Jeddah: Al-Aziziyah District, Mohammed bin Abdulaziz Street (Tahlia)
• Riyadh: King Abdulaziz Street, across from the Kingdom Tower
• Dammam: Al-Ashri’a Street, Al-Badeea, Dammam 32415.

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