The Kingdom of Saudi Arabia is popularly known for its massive oil industry. Moreover, it is popularly known for being the largest free economy in the MENA region. Furthermore, the kingdom is known to hold a share of almost 28% of the total GDP of the Arab world. Also, the country boasts easy access to multiple export markets that cover Europe, Asia, and Africa. Thus, the process of company formation in Saudi Arabia is greatly sought after nowadays.
It should be noted that empowering your business success in KSA is not as easy as it seems. Therefore it is greatly recommended to seek some professionally sound services in KSA to make sure that you are on the right track to make the much-needed corporate difference.
Entrepreneurs, wherever they are, always have an exciting life. However, if you are in KSA, there is an unlimited plethora of company formation opportunities for you to explore. KSA is referred to as the “young and wealthy community”. Therefore, if you have an exciting business idea and you are in KSA, waste no time to implement it and establish it to relish its fruit.
Overview of the Process of Company Formation in Saudi Arabia
During the tedious process of company formation in the Kingdom of Saudi Arabia, there are a number of factors that need to be taken into account. Some of such crucial elements include the following:
- Target audience
Types of Companies in Saudi Arabia
Setting up a company in the Kingdom of Saudi Arabia can be tricky. It should be noted that there are about three major company setups that can be established within the kingdom premises. These essentially include the following:
- Limited Liability Company – LLC
- Joint Stock Company – JSC
- Simple Partnership Company – SPC
The Cost of Company Formation in Saudi Arabia
As mentioned earlier, the budgeting of forming a company in Saudi Arabia depends on a number of factors. Thus, when this account planning is done in a comprehensive manner, you get the maximum return for your invested capital.
Thus, in this blog, we take a more detailed look into a detailed breakdown of all the company formation costs in the Kingdom of Saudi Arabia. These essentially include the following:
1- Obtain the Commercial Registration Certificate
First and foremost, please note that you need to get the commercial registration certificate. This certificate can be achieved from the Ministry of Commerce and Investment in about SAR 500 i.e. $133.
2- Get the Municipality License
Secondly, the relevant municipality is entitled to issue the municipality license, and you can also inquire about its cost from the same setup. It generally varies according to the size and location of your business and company setup. Generally, this license for company formation in Saudi Arabia ranges from SAR 1000 i.e. $267 to SAR 5000 i.e. $ 1334.
3- Acquire the Foreign Investment License
Thirdly, in case you are a foreign investor, you will need to apply for a foreign investment license. It should be noted that the Saudi Arabian General Investment Authority (SAGIA) is entitled to issue a foreign investment license (FIL). The price for this license generally revolves around the bracket SAR 3000 ($800) to SAR 8000 ($2133).
Moreover, it should be kept into account that this cost is generally subject to the size and type of your business.
4- Arrange the Minimum Capital Requirement
Following the foreign investment license, if you wish to establish a successful company in the Kingdom of Saudi Arabia, there is a mandatory requirement to arrange a certain minimum capital for it. Just like the license, this capital also depends on the type of your company setup.
For instance, the minimum capital requirement for a limited liability company (LLC) is SAR 10,000 ($2,667) and so on and so forth.
5- Pay the relevant Professional Fees
Last but not least, the cost of professional charges must also be considered. These professional charges include the ones for the involved lawyers, accountants, and other advisors who facilitated the process of company formation in Saudi Arabia.
As already discussed, this fee structure will mainly be according to your company’s size, company, and the scope of its deliverable services.
In a nutshell, the cost of opening a company in Saudi Arabia can range from SAR 15,000 ($4,000) to SAR 30,000 ($8,000), depending on the type of company and the services required. Working with a trusted advisor is essential. He or she can provide you with a detailed breakdown of the costs and help you navigate the process.
Thus, it is best advised to come to GCC Solutions, where our trusted and reliable company formation consultants along with professional advisors are at your service. We help our valuable clients and investors understand the process of company formation in Saudi Arabia so that you can plan your pocket accordingly.
We look forward to hearing from you!
Related Resource: Abu Dhabi Free Zone