The limited liability company (LLC, شركة ذات مسؤولية محدودة) is the vehicle most foreign investors use to set up in Saudi Arabia. This page covers what the 2022 Companies Law says about partners, managers, articles and capital, how an LLC compares with a branch, and how registration works step by step.
The limited liability company (شركة ذات مسؤولية محدودة in Arabic) is governed by Part VI of the Companies Law, issued by Royal Decree M/132 of 1/12/1443 AH (30 June 2022). Its assets are separate from those of its partners: the company alone is liable for its debts, and each partner risks only what they put into the capital.
Foreign investors favour it for three reasons. Full foreign ownership is allowed in most activities, liability is limited, and the running rules are light: one general assembly a year, written resolutions without a meeting, one or several managers. It suits services, consulting, tech and engineering projects, and trading under stricter conditions.
For a foreign investor, registration happens in two stages. First comes registration with MISA (the Ministry of Investment), explained on our MISA licence page. Then comes incorporation and the commercial registration (CR) with the Ministry of Commerce. The full route is in our guide to company formation in Saudi Arabia.
The three structures foreign investors use most. A single-owner LLC is an LLC with one partner; a branch is the Saudi extension of a foreign company.
Table 1
| Point | LLC (several partners) | Single-owner LLC | Branch of a foreign company |
|---|---|---|---|
| Legal personality | Yes, separate from the partners | Yes, separate from the owner | No, the foreign company acts directly |
| Liability | Limited to contributions | Limited to the contribution | The parent company is liable for all debts |
| Partners | 2 or more, no cap | 1 individual or legal entity | None: the parent company |
| Decisions | Partners' general assembly, statutory majorities | Owner decides alone, recorded in a register | Parent company's bodies |
| Founding document | Articles of association | Articles of association | No Saudi articles to publish |
| Scope of activity | As set in the articles and the MISA registration | Same | Restricted to the parent's activity |
| Best for | Several shareholders, joint venture with a Saudi partner | Solo founder or a subsidiary owned by one company | A group delivering a specific contract without a subsidiary |
Rules from Part VI of the Companies Law. The articles can set higher majorities than the law.
Articles 160–164
One or more managers, partners or outsiders, appointed in the articles or under a separate contract. Several managers can form a board of managers. The law sets no nationality requirement; an appointment binds third parties only once it is recorded in the commercial register. A sole manager who leaves must be replaced within 15 days.
Articles 165–166
Meets at least once a year, within 6 months of the financial year-end, and can meet remotely. Resolutions need partners holding more than half of the capital, or can be passed in writing without a meeting. Each share carries one vote.
Article 172
Amending the articles, or increasing or reducing capital, needs partners holding at least three quarters of the capital. On a cash capital increase, existing partners have a pro rata priority right.
Article 178
A partner selling to an outsider must notify the others through the manager. They, or the company, have 30 days to buy the shares. After that the partner may sell freely. The rule does not apply to inheritance.
Articles 164, 170, 171
A non-managing partner may inspect the books twice per financial year, and the company has 15 days to respond. Partners holding a quarter of the capital can ask the court to remove a manager. A resolution that breaches the law or the articles can be challenged within 90 days.
Article 157
The owner holds the powers of the manager and the general assembly, and records decisions in a register kept by the company. The owner may appoint managers to represent the company. The death or bankruptcy of a partner does not dissolve an LLC unless the articles say so.
Article 158 of the Companies Law lists the minimum content. On the Saudi Business Center these details are entered online and the articles are generated in Arabic. The full document list is in our document checklist.
Partners set the capital in the articles. It is divided into shares of equal value that cannot be split or traded (Article 174). The law sets no general minimum capital. The SAR 500,000 figure still quoted online comes from the old MISA licensing regime.
In practice MISA and the banks look at whether the capital fits the activity and the business plan: for a services LLC, expect SAR 100,000 to 500,000. Specific thresholds apply to some activities under the MISA Investor Guide (02-2026): SAR 30 million for 100% foreign-owned trading, SAR 26,666,667 for trading with at least 25% Saudi ownership. Details are on our requirements for foreigners page.
The capital belongs to the company and funds its operations. If losses reach half of the capital, the manager must call a partners' meeting within 60 days to decide whether to continue or dissolve (Article 182).
Typical route for a foreign-owned services LLC. Durations are estimates, except the MISA processing time published by the ministry. The detailed timeline is on our formation steps page.
Check the activity code against the excluded list and any capital or Saudi-partner conditions, then choose between a multi-partner LLC, a single-owner LLC or a branch.
Parent company CR and financial statements (or ID documents for an individual), legalisation or apostille, certified Arabic translation, power of attorney.
Online application and investment registration certificate, once the fee set by the ministry at approval is paid.
Trade name reservation (SAR 200 for an Arabic name, SAR 500 for a foreign-language name), then entry of the articles, partners and manager on the Saudi Business Center.
Payment of SAR 1,200 for incorporation and SAR 500 for publishing the articles, plus VAT. The same service opens files with the Ministry of Human Resources, ZATCA (Zakat, Tax and Customs Authority), GOSI (social insurance), the national address and the chamber of commerce.
Bank account and capital deposit, municipal licence if you have premises, Qiwa and Muqeem accounts for staff visas and iqamas (residence permits), then VAT registration once the threshold is reached.
Tax. Profits attributable to foreign partners are subject to 20% corporate income tax; the share of Saudi or GCC partners is subject to 2.5% zakat. Dividends paid to a non-resident partner bear 5% withholding tax, subject to tax treaties. VAT at 15% applies from registration.
Accounts and assembly. Each year the manager prepares financial statements and a management report, sent to partners at least 21 days before the annual general assembly (Article 167). Small enterprises are exempt from appointing an auditor, but the exemption excludes “foreign enterprises” and subsidiaries of groups that are not themselves small (Article 19). For a foreign-owned LLC, plan on a licensed auditor unless you get confirmation otherwise.
Renewals. Annual confirmation of the CR costs SAR 1,200 a year for an LLC from the second year, and the MISA registration must be updated every year. A change of manager, a share transfer or a capital change must be recorded in the commercial register through the Saudi Business Center to bind third parties. The full budget is on our company formation cost page.
Yes, in most activities, after registering with the Ministry of Investment (MISA). Some activities are excluded or carry conditions: SAR 30 million of capital for 100% foreign-owned trading, or 40% Saudi ownership for telecoms, for example.
One is enough. Since the Companies Law came into force on 19 January 2023 there is no upper limit; the old 50-partner cap was removed. Partners can be individuals or companies.
There is no general legal minimum for a services LLC. MISA and banks still expect capital that fits the project, typically SAR 100,000 to 500,000. Some activities have a fixed threshold, such as 100% foreign-owned trading (SAR 30 million).
Government fees outside MISA come to roughly SAR 1,900 to 2,500: trade name (SAR 200 or 500), incorporation (SAR 1,200) and publication of the articles (SAR 500), plus VAT. The MISA registration fee is set case by case at approval; advisory firms report a range from zero to about SAR 62,000 a year depending on the activity, to be confirmed at filing.
No. The law allows one or more managers, partners or not, with no nationality condition. In practice a resident manager holding an iqama makes the bank account and government platforms easier to handle.
An LLC has its own legal personality and caps the risk at the capital contributed, which suits a long-term presence. A branch commits the foreign company directly and is limited to its activity; it is mainly used to deliver a specific contract without creating a subsidiary.
Allow 4 to 8 weeks to the commercial registration, including document preparation. MISA processes a complete application in 10 working days according to its guide; incorporation on the Saudi Business Center then takes 1 to 3 working days if the file is complete.
Corporate income tax at 20% on the profits attributable to foreign partners, and zakat at 2.5% on the share of Saudi or GCC partners. Dividends paid abroad bear 5% withholding tax unless a tax treaty provides a lower rate.
Information verified in September 2026. Amounts and timelines are observed ranges provided for information only. Government fees are set by Saudi authorities and may change: we confirm them in writing before you commit to anything.
We look at your activity, your partners and your timeline, then prepare articles that fit (majorities, share transfers, management) before filing. A free 30-minute first call, then a written proposal.