The Saudi Company law recognizes following types of business entities:
- Limited liability Company (LLC)
- Limited Liability Company
- Joint Stock Company
- Partnership
- Branch of Foreign Company
Saudi Arabia free zones
1. The Industrial cities run by the administration of Saudi Industrial Property Authority (MODON) and it has nearly 28 cities. Mainly established for industries and to attract foreign companies to set up their business in such areas.
2. The Economic cities mainly established for energy and labor-intensive industries.
THE SAUDI ARABIA LIMITED LIABILITY COMPANY (LLC)
LLC is the preferable type of business entity used by local investors. An LLC requires appointing at least 1 Director and 1 Shareholder who can of any nationality upon approval of foreign capital investment license by SAGIA (Saudi Arabian General Investment Authority). The minimum paid up capital required for incorporation process is at the discretion of SAGIA. Depending on the activities to be undertaken, SAGIA can impose higher capital.
All LLCs needs to appoint a statutory auditor and the annual accounts must be audited and submitted annually
THE SAUDI ARABIA AGENCY AGREEMENT COMPANY
- The Companies who are not from the Gulf Cooperation Council countries can appoint commercial agent rather than to form a company in KSA (Kingdom of Saudi Arabia), this would allow them to legally avoid the need for an investment license. The commercial agent who is registered with the Ministry of Commerce and Industry (MCI) can sign the contract with the company.
- The commercial agent appointed is than responsible for representation, promotion, and selling of goods and services under terms and conditions required by the parent company.
THE SAUDI ARABIA JOINT STOCK COMPANY (JSC)
Equivalent to Public Limited Company
- JSC need to appoint a minimum of 2 shareholders and 3 directors, who can be of any nationality. The minimum share capital required is the US $134,000.
- JSC must appoint an auditor and must submit the audited financial reports annually.
THE SAUDI ARABIA LIMITED PARTNERSHIP
- For the registration process, it requires only one director and two partners of any nationality and residency. Amongst partners, there must be one general/managing partner and one limited partner.
- No minimum capital requirement for the registration of a limited partnership.
THE SAUDI ARABIA GCC BRANCH COMPANY
- A 100% foreign owned Saudi Arabia branch office can only be established by an existing GCC company. This entity requires the appointment of one shareholder and one director of GCC nationality.
- A legal representative resident in Saudi Arabia must be appointed to carry out the branch’s management and administration.
SAUDI ARABIA COMPANY REGISTRATION PROCESS:
Here Company Registration in Saudi Arabia
- Application for reservation of name with Ministry of Commerce and Industry
- Submission of Articles of Association and notarization
- The opening of bank account with Saudi bank
- Obtaining a business Location license from the municipality and registering with the post office
- Pay the registration fee with the Unified Center
- Obtain the certificate of registration
- Registering with the ministry of labor
- Registering with the General Organization for Social Insurance (GOSI)
- Registering with the department of ZAKAT
BENEFITS FOR COMPANY REGISTRATION IN SAUDI ARABIA
- Benefits to a foreign company to have 100% holding.
- Low rate for the land lease
- Easy availability of Loan of up to 50% of total cost of project/capital
- Exemption from customs duty on import of raw material and equipment
- A foreign company can bid on government contracts without Saudi partner or agent
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