How to start a foreign company in Saudi Arabia in 2024

Simplified procedures

In 2024, the Saudi Arabian government simplified the procedures for starting a foreign company in the country. These changes included:

Reducing the minimum paid-in capital required for a foreign company

Reducing the number of documents required to start a foreign company

Unifying the procedures for starting a foreign company in all regions of the Kingdom

As a result of these changes, it is now easier for foreign companies to establish their businesses in the Kingdom.

Reduced paid-in capital

The Saudi Arabian government reduced the minimum paid-in capital required for a foreign company to SAR 1 million. This reduction makes it easier for foreign companies to establish their businesses and invest in the Saudi market.

Reduced number of documents

The number of documents required to start a foreign company in Saudi Arabia was reduced in 2024. This reduction makes it easier for foreign companies to prepare the documents required to start a company in the Kingdom.

Unified procedures

The procedures for starting a foreign company in Saudi Arabia were different in each region. These procedures were unified in 2024. This unification makes it easier for foreign companies to understand the procedures required to start a company in the Kingdom.

Saudi partner

Saudi law requires that a foreign company have a Saudi partner with a stake of at least 25% of the paid-in capital. This requirement is intended to promote cooperation between Saudi and foreign companies.

Representative office

Saudi law does not require a foreign company to have a representative office in the Kingdom. However, having a representative office may be useful for foreign companies that want to learn about the Saudi market and build relationships with Saudi companies.

Commercial register

Foreign companies that want to start their foreign company must have a commercial register that is certified by the Saudi embassy and the Ministry of Foreign Affairs. The commercial register is submitted after obtaining an investment license in the Saudi Business Center portal to issue the commercial register according to the activity to be practiced.

Most companies that are issued investment licenses in the Kingdom of Saudi Arabia:

Professional partnership company:

A professional partnership company is a type of commercial company in which a group of people invest in the same profession. The liability of the partners is limited to the amount of their contribution to the capital. There are restrictions on the scope of activities allowed for professional partnership companies.

Joint stock company:

A joint stock company is a type of commercial company in which the shareholders contribute money to form the capital. The liability of the shareholders is limited to the amount of their financial contribution. Profits are distributed based on the shares of contribution.

Limited liability company:

A limited liability company is a type of company in which the shareholders are not liable for the debts and obligations of the company. The liability of the shareholders is limited to the amount of their financial contribution. Limited liability companies are usually the most common form of companies in the Kingdom of Saudi Arabia.

Single-member limited liability company:

A single-member limited liability company is a form of company in which one person owns the entire capital and is not liable for the company’s debts except within the limits of his financial contribution.

Branch of a foreign company:

A foreign company can establish branches in the Kingdom of Saudi Arabia, but the branch must comply with the requirements of investment licenses and other legal obligations within the Kingdom.

Procedures for establishment:

The general procedures for establishing a foreign company in the Kingdom of Saudi Arabia are as follows:

Issuance of an investment license through the Ministry of Investment

Submission of the articles of association and attaching the required documents to the Saudi Business Center

After obtaining approval, a commercial register and files are issued for the establishment in the Ministry of Labor, the General Authority for Zakat and Income, and the General Organization for Social Insurance

Benefits of establishing a foreign company in Saudi Arabia

The Kingdom has expanded its ambition to become a leading investment destination in business with a promising developmental and economic vision. Today, it is considered a beacon for investment in various sectors.

Investment in the Kingdom is characterized by its diversity and breadth of services and its fruitful opportunities with many advantages that attract a large number of foreign investors. These advantages include:

Access to a large consumer market

The Kingdom of Saudi Arabia has a large consumer market with a population of over 35 million people. This market has great potential for growth, with the population of the Kingdom expected to reach 40 million by 2030.

  • Benefiting from advanced infrastructure

The Kingdom of Saudi Arabia has advanced infrastructure in all fields, including transportation, communications and energy. This infrastructure facilitates the work of foreign companies in the Kingdom.

  • Cooperation with Saudi companies

Foreign companies can cooperate with Saudi companies to expand their business in the Saudi market. Saudi companies provide foreign companies with extensive local market experience and strong relationships with government agencies and other relevant entities.

  • Promoting trade exchange

Foreign companies contribute to promoting trade exchange between the Kingdom of Saudi Arabia and the world. These companies export their products and services to global markets.

  • Attracting foreign investment

Foreign companies contribute to attracting foreign investment to the Kingdom of Saudi Arabia. These companies have confidence in the Saudi economy and its future capabilities.

Achieving Vision 2030

Foreign companies contribute to achieving the Kingdom’s Vision 2030. These companies support promising economic sectors that the Kingdom aims to develop as part of Vision 2030.

The Kingdom of Saudi Arabia provides attractive investment opportunities for foreign companies. The kingdom enjoys a large consumer market, advanced infrastructure and a supportive investment environment.

It is best for companies to hire a lawyer or law firm.

Our Mission at Mithaq

Our mission at Mithaq is to support and encourage foreign investors to invest their money in the Kingdom and establish foreign investment companies’ branches. In our mission, we aim to provide the necessary support and assistance to investors to achieve their goals and achieve sustainable success in the Saudi market. Therefore, we remain ready to provide advice and necessary information to foreign investors and facilitate the establishment of foreign companies and provide the necessary services to ensure the success of investment.

The importance of hiring a lawyer or law firm to establish a foreign company in the Kingdom of Saudi Arabia

Establishing a foreign company in the Kingdom of Saudi Arabia requires compliance with a set of legal procedures and conditions. It may be difficult for foreign companies to understand these procedures and conditions, which could lead to mistakes that may cost the company a lot of time and money.

Therefore, it is important to hire a specialized lawyer or law firm in establishing foreign companies in the Kingdom of Saudi Arabia. The lawyer or law firm can provide the necessary legal advice to foreign companies and ensure their compliance with all the required legal procedures and conditions.

How to start a foreign company in Saudi Arabia in 2024

Mithaq: The Best Law Firm in Jeddah for Establishing Foreign Companies

Mithaq is a leading law firm in the Kingdom of Saudi Arabia that provides a wide range of legal services, including establishing foreign companies. The company has extensive experience in this field and has a team of specialized lawyers who can provide the necessary legal advice to foreign companies and ensure their proper and sound establishment.

Mithaq provides a set of legal services and support necessary for establishing foreign companies, including:

Providing legal advice on the procedures and requirements for establishing a foreign company in the Kingdom of Saudi Arabia.

Preparing the necessary legal documents to establish the company.

Representing the company before the competent government authorities.

Following up on the necessary procedures to establish the company until completion.

At Mithaq, we build trust… and are the optimal choice for foreign companies wishing to establish a company in the Kingdom of Saudi Arabia.


Phone: +966570070053
Email: info@mithaq.com.sa
Visit our office at: [our location]