Since 2010, the Global Law Experts annual awards have been celebrating excellence, innovation and performance across the legal communities from around the world.
posted 5 days ago
Establishing a Limited Liability Company (LLC) in Saudi Arabia for Foreign Investors
Foreign investors looking to set up a company in Saudi Arabia often choose a limited liability company (LLC), the most common business structure in the Kingdom. The advantages of an LLC in Saudi Arabia include the limited liability protection for shareholders, where their liability is restricted to the value of their equity stake in the company.
Under the Saudi Companies Law, a limited liability company (LLC) is one of the most flexible and widely used legal entities. There are two main types of LLCs:
Private LLCs are more common due to the streamlined registration process with the Saudi Companies Registry. Investors should note that the Companies Law was revised in 2015 and again in 2018, bringing significant changes to how LLCs operate in the Kingdom.
A Saudi LLC requires at least one shareholder, who can be either a natural person or a legal entity, and at least one director. If the company has more than 20 shareholders, a board of directors must be formed. For companies with 3 or more shareholders, a supervisory board must be established. The maximum number of shareholders is 50.
The capital requirements vary based on the industry and the specific legal structure:
The process of establishing a limited liability company in Saudi Arabia involves several steps, starting with reserving a company name and drafting the Articles of Association. These documents are submitted to the Ministry of Commerce for approval. Once approved, the company must register with the Notary Office, and a corporate bank account must be opened.
The Ministry of Commerce provides several online services for foreign investors to establish a company, including issuing commercial licenses, registering with the General Organization for Social Insurance (GOSI), and registering the company with the Zakat, Tax, and Customs Authority.
LLCs are the preferred business structure for foreign investors due to their simplicity, flexibility, and limited liability protection. However, foreign companies must comply with specific local regulations, including obtaining the necessary licenses and permits to operate.
Establishing a limited liability company in Saudi Arabia provides numerous benefits, including limited liability, flexible management structures, and access to one of the fastest-growing economies in the world. However, understanding the legal and financial obligations is critical to ensuring a successful setup.
References:
Author
No results available
Resetposted 6 days ago
posted 1 week ago
posted 1 week ago
posted 1 week ago
posted 1 week ago
posted 1 week ago
posted 1 week ago
No results available
ResetFind the right Legal Expert for your business
Sign up for the latest legal briefings and news within Global Law Experts’ community, as well as a whole host of features, editorial and conference updates direct to your email inbox.
Naturally you can unsubscribe at any time.
Global Law Experts is dedicated to providing exceptional legal services to clients around the world. With a vast network of highly skilled and experienced lawyers, we are committed to delivering innovative and tailored solutions to meet the diverse needs of our clients in various jurisdictions.