Things to consider if you are thinking of starting a business in KSA
- You need to have a good knowledge of the region. Be prepared to research the business sector you aim to operate within. Plan a study of the market conditions, your forecast results, and the competition.
- Prepare to find the investment from your resources or through your bank and preferably by other means than applying locally. Especially if you’re new to the region and without a track record.
- The law requires that you have a local partner who controls the business. The local partner, a company, or an individual, does not need to contribute to the start-up investment or participate financially at all. The local partner requirement is currently under review in some states, however, to encourage foreign investment.
- When the business is registered, you have to show the Ministry of Commerce that you have money to invest. The required sum varies between the states (between $10,000/£6,500 and $50,000/£33,500 ) and is regarded as a guarantee against liabilities, although you may withdraw the money shortly afterward.
The process is risky, meaning that knowledge is crucial. You have to consult a good lawyer from the outset.
When doing business with Arabs, you will meet bargaining and find them expert at it. You will need to be completely confident about the contents of your agreement.
Laws to consider
Corporate law is similar to any in western countries. That means businesses can run as limited liability operations, private companies, or other types of concern. As discussed, setting up a business or buying a going concern can be complicated, and you must obtain local legal advice and guidance about registration formalities. As a foreigner, you are likely to use a western/Arab joint venture law firm.
Workers from south-east Asia and the Indian sub-continent usually occupy unskilled, menial, or semi-skilled jobs. A powerful sponsor or employer is a weapon with officialdom, and observing his skillful negotiating can be an enlightening experience. The authorities are usually helpful and do not tend to be difficult unless they have a reason. You will find your life in the region easier if you are polite and patient. Smile and seek advice. Requesting advice shows respect for the person you asked. You will find that Arabs are friendly and helpful. With all the problems with customs, you can contact customs clearing agents in Bahrain to help you.
A shift away from nationalization to privatization
Saudi Arabia has experienced a shift in its national business model in recent years. Foreign consultancy services benefited from here. Saudi Arabia is rapidly becoming a place for doing business and setting up operations.
This country has enormous natural richness ranking in the third position globally, considering the most plentiful and valuable natural resources like oil, gas, and strategic minerals.
The family is well-respected in Saudi Arabia and is considered a top priority. For example, someone needs to leave from office for a family issue or emergency; everybody will encourage you to take care of it straight away without restricting him/her, even the boss, manager, or supervisor.
Disadvantages of starting a business in Saudi Arabia
The disadvantage for women entrepreneurs is that they need male permission to start a business in Saudi Arabia, as their name where government support is minimal.
- Women need permission. Hence, their husband or father is the owner of all their finances and controls their business.
- Women not being able to drive is an inconvenience and requires the added expense of a driver. The government of Saudi Arabia has initiated only a limited number of programs for women’s entrepreneurship development. So, keep this in mind.
- The lack of support from other women is the biggest issue facing women in business. Especially the foreign female entrepreneurs in Saudi Arabia.
The documents you will need
- Submit your documents to the consulate.
- Submit an application to the Ministry of Investment for your investment license.
- You will need approval from the Ministry of Commerce and Industry after submitting your company name and Articles of Association.
- You will need to sign the articles of association.
- Publish the articles and company names in the official gazette.
- Open a bank account, transfer share capital.
- Registration in General department of passports, ministry of interior, and Ministry of Labor for work/residence visas for foreign workers.
- Register in the Ministry of Commerce and Industry and the local Chamber of Commerce.
- A file number and certificate of business commencement.
- Registration in the General Organization of Social Insurance.
Starting a business in KSA as a foreigner – do it right
Do your research, read a book. All the information you can get will be useful.
Find a location for your office, and plan everything. Design your ideal space, from desks to chairs. When our workspace looks pleasant we feel better and more relaxed. Add some plants as a decoration. By making a comfortable environment you will boost your productivity.
Moving can be stressful and not always easy. Approach the moving process with a positive attitude, have a plan, and stick to it. If you organize your work step by step, everything will work out. Sit back and follow this guide step by step.
Go back to your work routine again, and enjoy your new place. Day by day, you will adapt, and everything will be just fine.