The KSA (Kingdom of Saudi Arabia) is the world’s largest oil exporter and producer. It also controls the second-largest hydrocarbon reserves. In the global market, the major contributors of leading business firms are from KSA. Setting up your own business in Saudi Arabia might be difficult or a complex task for expats, but with our team, you will get proper assistance during your process until you achieve your goals.
If we consider the global situation right now, then there are significant opportunities for businesses that are relatively emerging from very high-income populations. Some of the most important points regarding KSA are as follows:
- KSA is one of the largest Arab states, founded in 1932.
- Saudia Arabia is known as the heart of the Islamic world and one of the Middle East’s wealthiest nations.
- Due to the strategic location of KSA, it connects with Europe, Africa, Asia, and almost most of the entire world, which makes it a hub for business globally.
- The economy of KSA experiencing a 4% growth rate annually throughout the past seven years and will continue to the future for sure, allowing investors to move to Saudia Arabia to start their businesses.
- Saudia Arabia is facilitating the business ecosystem by making enormous efforts that support new business activities in a wide range of business sectors.
- This Arab country accounts for 20% of the registered oil reserves in the whole world. The sector of oil accounts for budget revenues of 80%, GDP of 45%, and export revenues of 90%.
- In Dec 2005, KSA entered World Trade Organisation. The entry of KSA into WTO leads its government to carry out diversification, and promotion of investors, especially foreign investors, and other economic reforms are now also carried out.
- The law on foreign investments offers foreigners to invest and carry out different business activities, except the sectors that are on the negative list.
Benefits of starting your business in Saudi Arabia
Saudi Arabia offers a very welcoming business environment as compared to many other countries. In the world bank’s business index, Saudia Arabia is ranked 62 out of 190 plus countries. That is why KSA is far ahead of other countries such as Oman and Qatar and includes business hubs such as Luxembourg in terms of ease of doing business.
The tax system here in Saudia is also very much favourable to foreign investors. KSA moving away from an oil-reliant economy means it provides more significant support and resources available for different business sectors.
The most prominent benefits that Saudi Arabia provides to its investors and foreigners that want to start their business here are
- 100% foreign ownership
- Low crime rate with quality living, including maintained standards for healthcare and education
- Low minimum capital requirements
- Capital repatriation is not restricted
- The perk of protecting all the personal assets & property
- Global access to investments within the KSA, as in 2005 KSA joined the world trade organization.
- Allowance of sponsoring foreign workers
- More tax advantages if companies are in less developed areas
Types of companies in Saudi Arabia
The MOI (Ministry of Investment) of KSA seeks to facilitate all foreign companies by establishing legal entities. These legal entities such as:
- LLC (Limited liability Companies)
- JSC (Joint stock company)
- SPLLC (Sole proprietorship Limited liability company)
- LLP (Limited partnership company)
LLC (Limited liability companies)
LLC is famous in almost all the gulf countries and very popular in the KSA market for company establishment. The owner gets no liability in this type as against the company debt. In simpler words, LLC is a business structure in KSA that helps the owner to protect from business liability and debts.
JSC (Joint-stock company)
JSC is the most regulated type of company in KSA. The regulation proceeded through requirements for incorporation and degree of involvement of MOCI (Ministry of Commerce and Industry). JSC’s liability lies with every shareholder according to their divided equal value share.
SPLLC (Sole proprietorship limited liability company)
An SPLLC is also a liability company and is always owned by only one person. That means that the owner is responsible for all the profits as well as for the debts and liabilities of the business.
LLP (Limited partnership company)
It is entitled to limited partners that can make investments in the business but cannot make operational decisions or any other kind of personal or company liabilities under this type. Also, more than one partner can create a limited liability partnership.
Joint ventures are a way of business arrangement where more than one party can agree to make the pool of their resources to accomplish a specified task. Also, two other types of businesses for foreign investors are available in KSA such as representative offices and branch offices.
A step-by-step guide to starting a business in Saudi Arabia
If you are interested in starting your business here in KSA, then the first thing you should do is book a free consultation with our EBS team specialist, which will help you gain information regarding your business formation process and other proceedings according to the country’s customs and the law.
The process is straightforward. Let’s discuss all the steps that are required for setting up your company here in KSA:
Step # 1. Choosing the right industry and structure for your business
The first thing is that as a business owner, you must outline the industry and all the activities regarding that industry you intend to work in. You will get an idea about the best business setup type for your needs, or whether you want to start your business in the free economic zone or the mainland of Saudia. It will also help us dictate your requirements for legal entities and the type of license you require. Saudi Ministry of Commerce approval is initially needed before starting your setup. Also, proof of having enough funds and the capability to invest in starting your business here in KSA is required.
Step # 2. Registration of your company name
The next step is to choose your company name and register it. There are many factors regarding name selection in KSA, such as the name of your company must be unique, not be copied from your competitors, and not be offensive or blasphemous to any religion.
Step # 3. Required documents
You can apply for your license and start your business in Saudi Arabia at this step. A complete application form along with a business plan, you will also be requested to submit these documents mentioned below:
- ID cards of all shareholders, if any.
- Passport Copies of all shareholders or directors.
- Memorandum of Association (MOA)
- Bank reference letter
- Articles of Association (AOA)
- Copy of your company name registration
Also, a business visa will require you to work, live and reside in KSA. Again, Emirate Business Setup is here for you to manage all your process.
Services offered by EBS to our Saudi Arabia clients
Emirates business setup is based on helping entrepreneurs with all the legal proceedings within the jurisdiction to start their businesses and to provide the ultimate solutions to every problem you might face during your process. EBS is expanded to Europe and Middle East, as we are providing services to Germany and UAE clients as well. There is a wide range of services that EBS offers to foreign investors in KSA, including
- Banking services
- Business formation and settlement
- Providing office premises
- Pro services
- Golden visa services
- Trademark registration services
- Product registration services
- Government approvals
- VIP services
- Tax and VAT services (Accounting and Auditing)