Company Formation in Saudi Arabia: A Comprehensive Legal Guide

Everything you need to know about the steps to establish your company in Saudi Arabia under the latest regulations and government requirements.

Company Formation in Saudi Arabia: A Comprehensive Legal Guide Establishing a company in Saudi Arabia is one of the most significant steps taken by business owners and investors amid Vision 2030, which aims to diversify the economy and strengthen the business environment. First: Available Company Types Saudi regulations allow for several legal forms of incorporation, most notably: - Limited Liability Company (LLC): The most common form among investors; no partner's share may be less than SAR 1,000. - Joint Stock Company: Suited to large-scale projects, requiring capital of no less than SAR 500,000. - Professional Company: Designated for licensed professions such as law, engineering, and medical consulting. - Sole Proprietorship: For small individual businesses, registered in the owner's personal name. Second: The Basic Steps to Incorporation 1. Reserve the trade name via the Maroof platform of the Ministry of Commerce. 2. Prepare the articles of association and notarise them before a notary public. 3. Register in the Commercial Register and obtain a registration number. 4. Obtain a certificate from the Chamber of Commerce. 5. Register with the Zakat, Tax and Customs Authority (ZATCA) to obtain a tax number. 6. Open the company's bank account. Third: Requirements for Foreign Investors Foreign investors are required to obtain an investment licence from the Ministry of Investment (Masaned), and certain sectors are excluded from full foreign ownership. It is advisable to engage a specialised legal consultant to verify open sectors and permitted ownership percentages. Fourth: Post-Incorporation Obligations After incorporation, the company must: - Submit periodic tax returns. - Comply with labour law and social insurance requirements. - Retain commercial books and financial records for no less than 10 years. - Comply with the Personal Data Protection Law (PDPL) if collecting customer data. For more information or to enquire about establishing your company, contact the Trivo Legal Consulting team.