How to Set Up a Business in Saudi Arabia as a Foreigner in 2025

Saudi Arabia has emerged as one of the most attractive destinations for business in Saudi Arabia as a foreigner in the Middle East, thanks to major economic reforms under its ambitious Vision 2030 plan
. In 2025, foreign investors and entrepreneurs from the USA, UK, Canada, UAE, and India are finding compelling reasons to launch or expand their business in Saudi Arabia as a foreigner in the Kingdom. With liberalized ownership laws, tax incentives, and a thriving economy, Saudi Arabia is strategically positioning itself as a global business hub for those looking to establish a business in Saudi Arabia as a foreigner. This comprehensive guide provides a detailed overview of how to set up a business in Saudi Arabia as a foreigner in 2025, covering essential requirements, step-by-step processes, and key considerations for success.

Benefits of Starting a Business in Saudi Arabia as Foreigner

Why choose Saudi Arabia for your next business venture? The Kingdom offers a range of compelling advantages for foreign investors:

• 100% Foreign Ownership: Foreign investors can now enjoy complete ownership of their companies without the need for a Saudi partner, especially in most commercial and industrial sectors. This gives businesses full control over operations, finances, and growth strategies.
• Strategic Location: Located at the crossroads of Europe, Asia, and Africa, Saudi Arabia offers unparalleled access to regional and global markets. The Kingdom is a gateway to over 400 million consumers in the MENA region.
• Tax Incentives and Business-Friendly Environment: Saudi Arabia offers a competitive 20% corporate tax rate, with additional tax benefits for businesses in special economic zones and underserved regions. Streamlined regulations and digital portals simplify business registration and compliance.
• Large Untapped Market: With a young, tech-savvy population and rising consumer demand, the Saudi market remains relatively untapped in many sectors, creating tremendous opportunities for innovation and expansion.

Key Requirements for Foreigners to Start a Business in Saudi Arabia

Setting up a business in Saudi Arabia as a foreigner in 2025 involves specific requirements designed to ensure compliance and a robust investment environment. Understanding these upfront is crucial for a smooth company formation process.

1. Minimum Capital Investment: While Saudi Arabia has eased capital requirements in many sectors, the specific minimum capital can vary based on your chosen business activity and legal structure. For a Limited Liability Company (LLC), a common choice for foreign investors, the average recommended capital is SAR 50,000 (approximately $13,300 USD) for services and manufacturing license, you don’t have to deposit in the bank. However, certain specialized or high-capital sectors may necessitate a higher initial investment.
2. Mandatory MISA License (Ministry of Investment of Saudi Arabia): The cornerstone of foreign business setup in KSA is obtaining a foreign investment license from the Ministry of Investment of Saudi Arabia (MISA). Formerly known as SAGIA, MISA is the primary governmental body overseeing and facilitating foreign investment. A valid MISA license is a prerequisite for any foreigner looking to establish a commercial entity and operate legally within the Kingdom. Our team at Expandway specializes in MISA license applications to expedite this critical step.
3. Saudi Office Address: National Address is required to open bank account, to take national address you can take shared space or rent an office, if you rent an office , you have to take BALADY AND CIVIL DEFENSE certificate also, it will cost 1000 SAR as govt fee, professional fee is not included. Virtual offices are not accepted for foreign company formations.
4. Legal Structures: Foreigners can choose from various legal structures:
   • Limited Liability Company (LLC)
   • Joint Stock Company (JSC)
   • Branch Office of a Foreign Company
   • Technical and Scientific Services Office (TSO) (for representation purposes only)

Step-by-Step Process for Business Setup in 2025

This section outlines the essential steps for registering your business in Saudi Arabia.

1. Obtain MISA License:
   • Submit required documents (passport, business plan, company profile, financial statements)
   • Get pre-approval within 5–10 working days
2. Reserve Company Name:
   • Reserve a trade name via the Ministry of Commerce (MoC) portal
   • Ensure the name is unique and reflects the business activity
3. Register with the Ministry of Commerce (CR):
   • Apply for Commercial Registration (CR)
   • Submit Articles of Association (AOA) and notarized documents
4. Open a Corporate Bank Account:
   • Use your CR and MISA license to open a business account with a Saudi bank
   • Deposit the initial capital if required
5. Obtain Municipality License:
   • Apply for a Baladiya (Municipality) license for your office location
   • Required for operation and inspections
6. Register with GOSI, ZATCA, and Chamber of Commerce:
   • GOSI (General Organization for Social Insurance) for employee insurance
   • ZATCA (Zakat, Tax and Customs Authority) for tax compliance and VAT
   • Chamber of Commerce membership is mandatory
7. Finalize Office Lease and Notarize Documents:
   • Lease a physical office space
   • Notarize lease agreement and attach to license documents

Common Challenges and How to Overcome Them

Navigating the Saudi business landscape can present unique challenges. Here’s how to address them:

• Language Barriers: Arabic is the official language. Hiring a bilingual consultant or using translation services can significantly smoothen communication with government entities.
• Understanding Local Regulations: Saudi laws and procedures can differ from Western standards. Collaborate with a trusted local service provider to navigate bureaucracy.
• Need for Local Consultants: Engaging a local advisory firm can fast-track your process, especially for PRO (Public Relations Officer) tasks and licensing submissions.
• Timeline Delays: Document attestation, government approvals, or incorrect submissions can cause delays. Ensure proper due diligence and document readiness in advance. Facing these challenges? Contact us for expert guidance.

Costs Involved in 2025

Here’s a breakdown of updated costs associated with setting up a business in Saudi Arabia for foreign investors:

1. Licensing Fees: 

First-year MISA license: SAR 12,000. From the second year onward, renewal is SAR 62,000. (Subject to potential revision by the Ministry of Investment.)

2. Notarization & Attestation (Home Country):
   • India: SAR 1,200–1,500
   • Pakistan: SAR 1,700–2,200
   • UAE: SAR 11,000–13,000
3. Counter Attestation & Translation (KSA): 

SAR 200 for counter attestation, SAR 500–700 for translation.

4. Office Rent: 

Average commercial space in Riyadh or Jeddah starts at SAR 25,000/year.

5. Other Government Fees:
   • QIWA: SAR 1,075
   • MUQEEM: SAR 1,265 
   • MUDAD: SAR 460
   • Company Registration: SAR 1,775
   • Name reservation
     1. Arabic Name: SAR 200 
     2. English Name: SAR 500.
6. General Manager Visa & IQAMA (1 year + 3 months): 

Visa – SAR 2,000, Work Permit – SAR 9,700, IQAMA – SAR 650, plus medical and insurance fees (varies).

7. Ongoing Compliance Fees: 

PRO services, tax filing, GOSI registration: SAR 15,000–25,000/year.

Best Industries for Foreigners in 2025

Saudi Arabia’s Vision 2030 initiatives have created significant opportunities across various sectors. Consider these promising industries:

• IT & Software Development: Saudi Arabia is heavily investing in digital transformation. Demand for software solutions, SaaS platforms, and cybersecurity is growing rapidly.
• Construction & Infrastructure: With megaprojects like NEOM and The Line, foreign construction firms and consultants are in high demand.
• eCommerce & Retail: The eCommerce sector is booming with high smartphone penetration and changing consumer habits.
• Manufacturing: The government is offering incentives for local production across automotive, FMCG, and pharmaceuticals.
• Consulting & Business Services: Management consulting, legal, HR, and financial advisory services are in demand as businesses grow in sophistication.

How Expandway Can Help

At Expandway, we specialize in helping foreign investors launch and scale their businesses in Saudi Arabia. From securing your MISA license to complete company registration, office setup, and PRO services, our team ensures a hassle-free, compliant process. All services are delivered in line with local laws, and we stay updated with regulatory changes to ensure your business is always in good standing. With years of experience and a track record of successful client ventures in KSA, Expandway is your trusted partner for navigating the Saudi market.

FAQ’s

Can I start a business in Saudi Arabia without a Saudi partner?

Yes, most sectors now allow 100% foreign ownership with a valid MISA license.

How long does it take to register a company in KSA?

The process typically takes 3–6 weeks, depending on documentation and activity type.

Do I need to visit Saudi Arabia in person?

No, the process can be managed remotely through a certified consultant or legal representative.

What is the minimum investment required?

It varies by activity, but LLCs generally require SAR 100,000 (~$26,600). Capital requirements can be higher for specific sectors.

Can I own 100% of the company as a foreigner?

Yes, complete foreign ownership is allowed in most sectors with a MISA license.

Is an office lease mandatory?

Yes, you must have a physical address in Saudi Arabia for your business.

Are there any restricted industries?

Yes, some sectors like oil exploration, military, and certain religious services are restricted to local or joint ownership.

Ready to get started?

Book a free consultation today and let us help you tap into the lucrative Saudi market with confidence.