Top 10 FAQs About Company Formation in Saudi Arabia (2024 Guide)

Saudi Arabia stands out as one of the most attractive investment destinations in the Middle East, thanks to its strong economy, abundant natural resources, and immense growth potential. The Saudi government actively encourages foreign and local investors by offering unprecedented legal and regulatory facilities.

If you're considering starting a business or expanding your company in Saudi Arabia, this article answers the most frequently asked questions to help guide your decision.

Top Questions About Starting a Business in Saudi Arabia

1. What Types of Companies Can Be Established in Saudi Arabia?

You can set up various legal entities in Saudi Arabia, including:

• Limited Liability Company (LLC)
• Joint Stock Company
• Sole Proprietorship
• General Partnership

2. What Are the Basic Steps to Register a Company in Saudi Arabia?

• Obtain the investment license
• Notarize the Articles of Association
• Register with the Commercial Registry
• Complete all government paperwork
• Apply for the General Manager’s residency (Iqama)

3. Can Foreigners Open a Company in Saudi Arabia?

Yes. Foreign investors are allowed to establish companies in Saudi Arabia, provided they meet the legal requirements and obtain the necessary licenses from the competent authorities.

4. How Long Does It Take to Start a Business in Saudi Arabia?

The timeline varies depending on the business activity and required approvals. On average, it takes between 4 to 12 weeks. However, with Sidra, the entire process can be completed in just 7 business days once all documents are submitted.

5. What Are the Requirements for Setting Up a Sole Proprietorship in Saudi Arabia?

• The owner must be a single individual responsible for all liabilities
• All legal and administrative procedures must be fully completed

6. What Licenses Are Required for Foreign-Owned Companies?

• Saudi entry visa
• Work permit
• Ministry of Commerce investment license
• Registration with the Chamber of Commerce
• Activity-specific permits from relevant authorities

7. Can a Company Be Converted into a Non-Profit Organization?

Yes. Certain types of companies can be converted into non-profit entities by amending their bylaws and obtaining approval from the appropriate government bodies.

8. What Are the Steps to Validate a Company’s Articles of Association?

• Choose the company type
• Draft and sign the Articles of Association
• Register with the Commercial Registry
• Obtain the General Manager’s residency
• Register with the Zakat, Tax, and Customs Authority (ZATCA)
• Secure all necessary operating licenses

9. What Are the Government Fees for Company Formation in Saudi Arabia?

The fees vary based on the company type and procedures. Typical costs include:

• Licensing fees
• Commercial registration fees
• Chamber of Commerce fees
• Additional government-related charges

10. How Can I Get a Free Consultation on Business Setup in Saudi Arabia?

You can contact Sidra for a free consultation by speaking with our expert team or booking a session through our website.

Why Choose Sidra?

Sidra makes company formation in Saudi Arabia simple, fast, and fully compliant. With all required documents, your company can be registered in as little as 7 days. Connect with our consultants today and claim your free business setup consultation.