Today, Saudi Arabia has become the fastest-growing business hub in the entire Middle East. Since Vision 2030, foreign investment in Saudi Arabia has received strong support. Therefore, many entrepreneurs are looking to form joint ventures and partnerships with Saudi partners.

However, starting a company with a foreign investor involves a process that requires understanding licensing, ownership regulations, labor laws, tax systems, partnership agreements, and more.

Let’s understand this step by step:

1. MISA Investment License

If your partner is from a foreign country (non-Saudi), obtaining a license from MISA (Ministry of Investment Saudi Arabia) is mandatory before registering the company.

What does this license do?

* It officially grants the foreign investor full rights to conduct business in Saudi Arabia.

* It significantly simplifies your company registration process.

* It provides access to government platforms.

* You can legally maintain foreign ownership.

MISA thoroughly reviews documents such as passports, corporate papers, financial evidence, and the business model.

2. Foreign Ownership Regulations in Saudi Arabia

Saudi Arabia has opened up several activities for foreign investors, such as:

* 100% foreign ownership is permitted in categories like trading, services, contracting, manufacturing, IT, and consultancy.

* In certain restricted sectors, a Saudi partner or special approval is required.

Therefore, before drafting the partnership deed, it’s crucial to verify whether these activities are open to foreign investors.

3. Which Company Structure is Right? For foreign partnerships, two options are generally very popular, such as:

1. a) Limited Liability Company (LLC)

This is the most common structure:

* Easy operation

* Flexible ownership

* Limited liability

* Perfect for medium-sized projects

1. b) Joint Stock Company (JSC)

For larger companies:

* Public listing possible

* Perfectly suited for projects with significant investment

4. Complete Step-by-Step Process for Company Formation

Step 1: Activity Permit Check

First, check whether your business activities are open to foreign investors or restricted.

Step 2: Apply for MISA Investor License

You will need to submit these documents:

* Passport

* Business plan

* Proof of financial capacity

Upon approval, you will be categorized as a foreign investor.

Step 3: Reserve a Trade Name

Go to the Ministry of Commerce portal and reserve your company’s trade name.

Step 4: Draft the Articles of Association (AOA)

This includes:

* Partners’ shares

* Capital

* Management system

* Voting power

* Profit distribution

* Exit rules

Step 5: Obtain Commercial Registration (CR)

After the MISA and AOA processes are complete, the company’s CR is issued. This is essentially your business license.

Step 6: Registration with Government Authorities

The company must register with:

* Chamber of Commerce

* ZATCA (VAT, Taxes, and Zakat)

* GOSI

Step 7: Open a Bank Account

Saudi banks are very strict regarding documentation, so foreign partners must have all the necessary paperwork in order.

Step 8: Visa and Labor Setup

Employee contracts are uploaded to the Qiwa portal, and investor visas and work visas are also issued.

Conclusion

If you want to run a business with a foreign partner, you need guidance from an expert. BetterHelp business service company in saudi Arabia makes this entire journey much easier – managing everything in one place, including MISA license, company registration, VAT & Zakat compliance, Qiwa/GOSI setup, banking support, and legal documentation. Our professional team provides customized solutions tailored to your business, ensuring your venture runs quickly, smoothly, and legally. If you want to expand your business in Saudi Arabia, BetterHelp business service company in saudi Arabia can be your trusted partner, providing reliable services at every step of your business journey.