Many of our clients are involved in cross-border transactions or are interested in forming a company in a foreign jurisdiction. One popular jurisdiction for foreign investment is the Kingdom of Saudi Arabia, a country in which Spectra Law has experience structuring and forming business entities. This newsletter summarizes the steps involved in forming a company in the Kingdom of Saudi Arabia.
The first step in forming a company in Saudi Arabia is to obtain a foreign investment license. This involves determining the shareholding company, the specific activities which the Saudi company will perform, as well as the paid-in capital of the company. The vast majority of foreign investors choose limited liability companies as the entity type due to their liability protection, fewer requirements, and less expensive maintenance costs.
The second step is to draft and submit the articles of association (or bylaws) of the company. This involves tailoring the standard form provided by government authorities to set out the management structure, financial year, and other corporate provisions. The relevant authority will review and approve the text of the articles of association (or bylaws).
The final step is to appoint the manager(s) that will represent the company and issue the commercial registration (CR) certificate. The CR serves as the company’s identification before all government authorities in the Kingdom of Saudi Arabia.
Please contact us to obtain more information on forming a company in the Kingdom of Saudi Arabia.