As the 2020s progress, the world is daring to have conversations about the possibilities of doing business in Saudi Arabia, that it might have once barely imagined it could have.
The Vision 2030 industrial strategy has been fundamental to the Kingdom’s efforts to engage Western investors far beyond the energy sector. This economic diversification initiative has put ambitious reform and investment schemes at the forefront, aiding the development of such key sectors as renewable energy, technology, healthcare, logistics, and tourism.
As the remolding of the KSA’s business landscape continues apace, if you are reading this as an entrepreneur or investor from outside the West Asian country, you might have noticed that the barriers to participation in this exciting economy are lowering.
It has been great to see the steps the Kingdom has made to streamline business setup and licensing procedures and cultivate an entrepreneur-friendly environment. This should not mean, however, that you are complacent about the steps you will need to take to establish your own business presence in Saudi Arabia.
The below actions, then, will be crucial as you look to make a smooth transition to involvement in this part of the Arabian Peninsula’s ever-more dynamic economy.
Securing a business license from MISA
If you are looking to commence a business journey in the KSA, applying for a business license through the dedicated online portal of the country’s Ministry of Investment (MISA) will need to be one of your very first actions.
You may be heartened to discover that the Kingdom allows 100% foreign ownership in most business sectors. This reflects the state’s determination to attract the right international investment.
Registering a business name and trademark
Entrepreneurs and investors that are seeking to establish a business in the Middle East’s largest country will need to select a unique and distinctive name for their business. This name should reflect their brand identity, and it must not violate any existing trademarks.
The Saudi Ministry of Commerce’s website makes it easy to check the availability of whatever name you may have in mind. It will also be necessary to register your trademark with the Saudi Authority for Intellectual Property to guard against any unauthorized use of your brand.
Opening a bank account in the Kingdom
The opening of a bank account in the KSA will be another vital step for the management of your finances and transactions in this part of the world. Various local and international banks offer services and products to assist your experience of doing business in Saudi Arabia.
Don’t forget, too, to set up an accounting system that adheres to Saudi accounting standards and regulations. A professional accountant or accounting software may help you in accomplishing this.
Obtaining a Commercial Registration (CR) number
Any new business in Saudi Arabia must also be registered with the country’s Ministry of Commerce (MCI). Undergoing this process will enable you to receive a CR number, thereby making your business a legitimate entity permitted to undertake trade activities in the KSA.
Considering the merits of an Employer of Record (EOR) service
So, you know that you wish to hire a few staff members in Saudi Arabia, as part of your efforts to gradually establish a foothold in one of Asia’s largest and most economically influential countries.
What you may not have realized, though, is that you don’t necessarily need to go as far as setting up a local entity.
Instead, you might contemplate the advantages of engaging a reputable EOR service, such as Aspirock. This service entails us becoming the legal employer of our client businesses’ team members, while taking responsibility for compliance with employment regulations, encompassing such aspects as employment contracts, payroll, and taxes.
In the countries that make up the Gulf Cooperation Council (GCC) area – such as Saudi Arabia and the United Arab Emirates (UAE) – you might sometimes see EOR and Professional Employer Organization (PEO) services being referred to by other terms. You might see mentions of “employment visa outsourcing services”, for example, or “payroll and visa outsourcing services”.
If you’re interested in learning more about how our global payroll platform and EOR service could greatly ease the process of maximizing your business involvement in Saudi Arabia, please don’t hesitate to contact our specialists at Aspirock today.