Setting up a company in Saudi Arabia

01Seven routes into the Kingdom

A foreign company operates in Saudi Arabia through one of seven routes. Each route limits what the entity can do.

There is no separate financial centre. None of the five special economic zones is a financial centre. Banking, insurance and securities businesses need approval from their sector regulators as well.

Foreign companies that only own real estate in the Kingdom cannot carry out any economic activity.

02Foreign ownership

Most activities are open to 100% foreign ownership. Activities on the excluded list need prior MISA approval.

• The Investment Law (Royal Decree M/19 of 2024) replaced the 2000 Foreign Investment Law. It came into force on 7 February 2025.
• The Standing Ministerial Committee for Examination of Foreign Investments decides on requests for excluded activities.
• The excluded list has two tiers, prohibited activities and restricted activities. Real estate development in Makkah and Madinah is an example of a prohibited activity.
• Foreign investors include individuals as well as companies.
• Foreign ownership caps in listed joint stock companies vary by activity. Banks, insurers and telecommunications companies are examples.

Property

• Non-Saudis own property only inside designated areas, under a real estate ownership law approved in August 2025. It applies from January 2026.
• Legal residents can own one residential property outside those areas, but not in Makkah or Madinah.

Operating without registration

Operating without registration is an offence under the Anti-Concealment Law of 2020. Penalties include fines, imprisonment, seizure of proceeds and deportation of non-Saudis.

03Conditions by activity

Trading, communications and professional activities carry conditions on Saudi share, capital or investment. The table gives the rules in force from the MISA Investor Guide.

Five-year investment commitment for 100% foreign commercial companies

The company chooses one of two options.

• Option one: SAR 300 million, of which SAR 30 million is cash capital.
• Option two: SAR 200 million plus one of three further commitments. These are 30% local manufacturing, 5% of sales spent on research and development, or a unified logistics and after-sales centre.

04Legal forms and capital

The Companies Law sets the forms a foreign investor uses. A limited liability company has no statutory minimum capital.

• The Companies Law (Royal Decree M/132 of 30 June 2022) took effect in January 2023.
• The activity-specific capital in section 03 sits on top of company law.
• Companies in a special economic zone are Saudi limited liability companies, either single-member or multi-member. They are registered in a dedicated companies register and are outside the Companies Law.
• A joint stock company has a board of at least three. A limited liability company is run by one manager or by a board of managers.
• Managers and board members are jointly liable for losses caused by breaches or neglect.
• A manager who does not call a shareholders' meeting after losses reach 50% is liable to up to one year of imprisonment and a fine of up to SAR 1 million.

05Licences and authorities

A foreign-owned business registers with several authorities. MISA issues the investment registration and the Ministry of Commerce issues the commercial registration.

• MISA: issues the investment registration certificate. It replaced the foreign investment licence.
• Ministry of Commerce: issues the commercial registration and the articles of association. The registration lasts one year and is renewed every year.
• Sector regulators: issue activity licences. For regulated sectors the sector licence is needed before the commercial registration.
• Other registrations: the municipality, the Ministry of Human Resources and Social Development, the General Organisation for Social Insurance (GOSI) and the Zakat, Tax and Customs Authority (ZATCA) each need a registration.
• Chamber of Commerce: membership is mandatory.

MISA registration is needed before any investment activity. One registration can cover several sectors, so separate MISA sector licences are no longer needed. A merger of investment registers is not available for RHQs, scientific offices, economic offices and professional companies.

06Steps, timing and fees

Setting up takes seven steps, mostly online. MISA states about 10 working days for the investment registration.

1. Reserve the company name through the Saudi Business Center.
2. Register the investment with MISA.
3. Upload the draft articles of association for attestation by the Ministry of Commerce.
4. Obtain the commercial registration.
5. Open a bank account and deposit the capital.
6. Obtain municipal and sector licences where needed.
7. Register with the Chamber of Commerce, GOSI and ZATCA.

Timing and fees

• The Ministry of Commerce stage takes five to ten business days when the articles follow the standard form.
• MISA sets the registration fee when it approves the file. The fee must be paid within 15 business days of notice or the registration lapses.
• Registrations of scientific and technical offices, liaison offices, RHQs and government contracts carry a MISA fee payable within 30 days of notice.
• The annual update fee has the same 15 business day deadline. The annual registration update takes about five working days.
• Amendments, mergers, activity changes and cancellations carry no MISA fee.
• Partner resolutions and commercial register updates are completed within 30 days of a registration amendment.
• Every registered investor answers the MISA questionnaire within 14 working days of notice.

Documents

• Saudi Arabia joined the Apostille Convention on 7 December 2022. Apostilled foreign documents need an Arabic translation.
• Some offices still ask for the older legalisation.
• Filings with MISA and the Ministry of Commerce need certified Arabic translations.

07Special economic zones

Five special economic zones operate under the Economic Cities and Special Zones Authority. Benefits attach to qualifying activities and qualifying income.

Resolution 468 of 16 January 2026, published in Official Gazette issue 5140, sets the framework. It applies 90 days after publication. ZATCA issued procedural guidance in August 2026.

Benefits and rules

• Income tax: 5% on qualifying income for up to 20 years in King Abdullah Economic City, Ras Al-Khair and Jazan. The Cloud Computing and IT zone charges the standard 20% on qualifying income and states no duration. The Riyadh Integrated Special Logistics Zone has 0% income tax for 50 years on its qualifying activities. The 50 years run from the licence date or until the entity leaves the zone, whichever comes first. Non-qualifying income is taxed at the normal rate. Licensed companies are subject to the Saudi Income Tax Law and its by-laws.
• Withholding tax: exempt on payments to non-residents linked to qualifying income in Jazan, Ras Al-Khair and King Abdullah Economic City. An annual withholding statement is still required. The Riyadh Integrated Special Logistics Zone exempts dividends, loan charges and related-party royalties and technical service fees during the exemption period. The Cloud Computing and IT zone applies the standard withholding rates.
• Zakat: exempt, subject to conditions, in King Abdullah Economic City, Ras Al-Khair and Jazan. The Riyadh Integrated Special Logistics Zone has no special zakat exemption.
• VAT: 0% on supplies from the mainland to licensed zone entities for licensed activities. Imports from abroad under customs suspension are outside VAT. The Cloud Computing and IT zone follows the standard mainland VAT rules.
• Customs duty: suspended on goods tied to licensed activities and due when the goods enter the mainland. The Cloud Computing and IT zone follows the standard mainland customs rules.
• Economic substance: mandatory. The zones allow adjusted Saudisation targets for specialised technical roles in the first five years. This is not a blanket exemption. Employees tied to a zone licence are relieved of the dependant fee.
• Mainland branches of zone entities: need a separate tax number and do not receive the zone incentives.

08Bank accounts

A company opens a corporate bank account and deposits its capital after it holds its commercial registration. Salaries are paid through Saudi bank accounts.

• Banks ask for the commercial registration and the MISA licence when they open the account, as step 5 of section 06 shows.
• The Saudi Central Bank (SAMA) set rules on 2 February 2022 for remote opening of accounts by foreign companies under the 2000 Foreign Investment Law.
• Under those rules the bank verifies the commercial register, the MISA licence, the company name, legal form, capital, owners and their ownership percentages, and the board members or executives.
• Only the general director of the company can use the service. The director's name and powers must appear in the memorandum of association.
• The general director can operate the account with a passport and presents the iqama within 90 days of the account opening date.
• Salaries must be paid through Saudi bank accounts under the Wage Protection Programme.
• A company needs a legal presence in the Kingdom to obtain credit.

09Reporting duties

Companies file annual financial statements with the Ministry of Commerce. Companies with Saudi or GCC owners file audited accounts with ZATCA.

• Financial statements: filed annually with the Ministry of Commerce through the Qawaem portal.
• Audited accounts: companies with Saudi or GCC owners file them with ZATCA together with the tax or zakat return. Financial statements, tax filings and zakat filings follow the company's fiscal year. The annual return and the final payment are due 120 days after year-end.
• Branches: file financial statements and an audit report within six months of the fiscal year-end.
• MISA ownership register: foreign investors update it every year or confirm that nothing changed. The register serves Saudi authorities, including the General Authority for Competition.
• Country-by-country report: due 12 months after year-end for groups above SAR 3.2 billion of revenue. The FY2024 report was due by 31 December 2025 for calendar-year groups.
• Financial account data: Saudi Arabia exchanges it under the OECD Common Reporting Standard and has a Model 1 intergovernmental agreement for FATCA.
• Merger control: applies when the parties exceed SAR 200 million of combined worldwide sales, the target exceeds SAR 40 million of worldwide sales and combined Saudi sales exceed SAR 40 million. Notice reaches the General Authority for Competition at least 90 days before completion.

10Incentives and support programmes

Nine programmes support or reduce the cost of investment. Each has its own qualifying test.

RHQ conditions

• A licensed RHQ qualifies with a Saudi office, board meetings in Saudi Arabia, at least one resident director, local operating spend and enough full-time staff.
• The RHQ must employ at least 15 full-time staff within one year of issue. At least three of them are at executive director or vice president level.
• The RHQ must start the mandatory RHQ activities within six months of issue and at least three optional RHQ activities within one year of issue.
• A failed substance test carries a fine of SAR 100,000, then SAR 400,000, then suspension of the incentive.