Insurance Open a branch in Saudi Arabia with our support

If you want to open a branch in Saudi Arabia, you will find the process to be laborious, but we can help you simplify it. This way, we can assure you that opening a new branch of business in this country will be a quick and satisfactory process. Furthermore, with our help, your company will have a prominent presence in Saudi Arabia, due to its great benefits.

In this way, your branch will be a safe reflection of the functions and activities of your parent company. Moreover, with our experience, you will be able to promote and generate business for your main company. This is also because when you open a branch, you will have 100% ownership of it, as well as not need a local partner.

Thanks to the Foreign Investment Law of Saudi Arabia, you will also own the properties required for your branch. In addition, you will be able to keep the same incentives that are granted to national companies. Thus, when you open a branch in Saudi Arabia you will have a more direct presence than a commercial agent.

Company Formation Saudi will help you with your compliance

The SAGIA (Saudi Arabia General Investment Authority) is the one that establishes the initial approval to be able to open a branch. Then the Company Regulations and the Foreign Investment Regulations grant the permission to establish it. One of our primary jobs is to guide you through these first steps to the end of the process.

Similarly, if you want to open a branch owned by GCC nationals, it needs the approval of the Ministry of Trade and Investment. Likewise, this ministry acts following the Company Regulations to support the development of branches. Therefore, we are the link that you need so that you can fulfill the requirements of the aforementioned ministry.

In addition, your business branch may engage in business activities covered by your permit. Also, a company that wants to open a branch needs a base capital of SAR 500,000. Also, a company must open a new branch in an area with easy access to the activity to be carried out.

What services we provide to our customers business

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We have the best business advice for your new branch in Saudi Arabia

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Foreign Company Registration in Saudi Arabia with our support

We have the best business advice for your new branch in Saudi Arabia

Due to our experience helping businesses to open a branch, we provide you with advice on the following aspects. For example, the branch must have the same name as the main company. Also, this is an extension of the main company, so you cannot decide regarding its activities.

Also, when you open a branch, it must have a legal address in a Saudi city. Thanks to this you will be able to obtain the benefit of avoiding double taxation.

This is because they are subject to the activities carried out by their parent company. Likewise, we can help you not only to open a branch but several, since foreign companies can do so. Otherwise, these subsidiaries are suitable for both medium and large companies.

For these and other reasons, we can provide personalized support to both foreign individual investors and interested companies. We offer you security in all these processes due to our vast experience in opening a new branch of business.

Open any type of branch with our professional help

In Saudi Arabia, you can open a branch of two types, each with particular characteristics. In any of the cases, our team is ready to advise you and make sure you are successful with the one you choose. These are:

Permanent branch

When opening a new branch of business in Saudi Arabia, you can choose to make it permanent. In this case, it is an extension of the main company located in another country. One of the main requirements of SAIGA is that the initial capital must be SAR 500,000.

Advantages of a permanent branch

Opening a permanent branch in Saudi Arabia has certain advantages, among which are:

  • Depending on the circumstances, the process can be straightforward.
  • The process bears similarity to forming an LLC.
  • You do not need articles of association.
  • It has the possibility of carrying out projects in both the public and private sectors.
  • It has a wide range of activities.

Disadvantages of a permanent branch

The disadvantages of opening a permanent branch are:

  • Activities are limited by SAGIA.
  • You cannot carry out promotional, marketing, and commercial activities. Only under conditions of Saudi participation and higher capitalization.
  • You may not open a branch solely for promotional or representative activities.

Technical Scientific Services Office (TSSO)

If you want to open a branch of the TSSO type, you should know that it is through an agreement. The registered trade agency distribution agreement must be between a foreign manufacturing entity and a registered Saudi distributor. Also, this can only be applied to complex products.

Another point is that this branch can help the distributor with marketing and customer relations. However, you may not market or sell the product or generate income from it. Furthermore, the advantage when you open a branch of this type is that does not require capitalization.

Likewise, you must register a current distribution contract in the Department of Commercial Agencies of the Ministry of Commerce and Industry. This is another point where our specialists play an important role in simplifying this requirement for you.

 Advantages of a TSSO

The opening of a new business branch of this type has its advantages, among which are:

  • The establishment process is simpler than that of a company.
  • It serves as market research for the main company.
  • There is no required capital.

Disadvantages of a TSSO

Despite having certain disadvantages, our experts can advise you to alleviate some of them. The disadvantages when you open a branch of this type are:

  • Limitation of complex products to require a TSSO.
  • The applicant has to be the actual manufacturer of the product and not an intermediate supplier.
  • The main parent company cannot evade liability in KSA, which may expose it to its place of incorporation.
  • You cannot provide services outside of local technical support for the local distributor.
  • The number of employees is limited by the Saudi authorities.

RESOURCEFUL INFORMATION

We can help you simplify the process to open a branch in KSA, as we are experts in it. It is necessary to have an experience like ours because the procedure depends on the ownership and management structure of the company. The process to open a branch requires a capital deposit and a procedure similar to that of a subsidiary.

In addition, the commercial activity of the branch is limited to objects that have been approved by SAGIA. It is important to have a reliable consulting service like ours to facilitate the operation of your branch in Saudi Arabia. This is due to the local procedures that involve the authorities, and that we handle efficiently.

Below you can see in detail the steps to open a branch in Saudi Arabia:

Reserve a business name

The first step when you open a branch is to reserve a name with the Ministry of Trade and Industry. This will have a valid period of 2 months. This is a simple process and does not require any special fees.

Apply for the investment license

This is one of the primary requirements for opening a new branch of business in Saudi Arabia. This is another aspect in which we can advise you and give you the best solution thanks to our knowledge of the process.

Such application must be made to the Saudi Arabian General Investment Authority (SAGIA) to obtain an investment license. The documents required for this process are:

  • Standard license application form. This must be filled out and signed by each applicant, who must authenticate that they have reviewed the Foreign Investment Regulation and its Implementation Rules.
  • Authenticated resolution of the board of directors of the applicants to incorporate an LLC.
  • Authenticated copy of the certificate of incorporation and statutes of the applicant.
  • Balance of the applicant for two years before the application.
  • Copy of the passport of the candidate manager, as well as of the persons included in the statutes of the applicant, including blank pages. In addition, four passport-size photographs of all the persons mentioned must be added.

The execution time of this process is 3 to 4 weeks and it has an approximate cost of SAR 2000.

Legalize the documents

The next step when you want to open a branch is to legalize the documents of the parent company to verify its legitimate existence. In addition, the authorized representative must grant and legalize the bylaws before a notary public. As well, we can advise you on the documents that must be legalized, among which are:

  • Original statutes of the association.
  • The Directory of Companies signed out by the shareholders or their representatives.
  • Copy of the certificate of incorporation and bylaws of each shareholder.
  • A legalized power of attorney authorizing the representative of each shareholder to sign the bylaws.
  • Copy of each of the identity cards of the two witnesses present.

We can help you consign these documents with a notary public, to ensure that they are correct. You can rely on us to prepare this documentation and make sure it is in order before submitting it. This process can take between one or two weeks from its consignment, which also has no charge.

However, this procedure can take less time thanks to computerization and electronic notarization.

Publication in the Official Gazette

This step in the process of opening a new branch of business is essential before continuing. You must wait for the publication in the official journal of the name of the company and a summary of the statutes of the branch. Also, this process can take up to 2 days to complete with a cost between SAR 650 to 5500.

Bank account

Another significant step when you open a branch is opening a bank account in Saudi Arabia. Also, a company needs to open a new branch in an area with easy access to the best banks. In this way, the shareholders will not have problems transferring the share capital to the company.

At the same time, you will be able to obtain a certificate confirming that the capital has been deposited. We can also help you in this process, require before the final procedure in the Unified Center. Apart from depositing the principal, you do not need to pay any other fees for this two-day process.

Set up an office

Before completing the registration in the Mercantile Registry, you will need to have a registered office address. As a result, it is a process that does not involve formal procedures but lease agreements. However, a company needs to open a new branch in an area with easy access.

Registration in the Mercantile Registry

The final step when you open a branch is to obtain a business registration certificate. This process must be carried out before the Mercantile Registry of the Ministry of Commerce and Industry. In this sense, you simply have to send the requested documents to this registry in the Unified Center.

The documents that are generally required for this process are:

  • The legalized resolution in the meeting of the shareholders where its members are appointed.
  • Two notarized copies of the statutes.
  • Two copies of the receipt of fees for publication of the summary of the bylaws in the Official Gazette, or in the commercial newspaper.
  • The bank certificate confirms the payment of the required capital.
  • A copy of the investment license from the SAGIA.
  • A copy of the office lease.

Register membership in the Chamber of Commerce

Another important step to open a branch is to register with the Chamber of Commerce. This process, which is also covered by our services, lasts 1 day and costs about SAR 2000.

Sign up for taxes

Another important process of opening a new branch of business is tax registration. This is because you need to obtain a file number and a certificate of commencement of business. This registration must be done at the Department of Zakat and Income Tax (DZIT).

Zakat is a religious wealth tax, which is assessed on taxable income and certain assets. In addition, this consists of an effective rate of 2.5% of the total capital resources of the companies. For this process, you need to submit a series of documents:

  • An official registration form, which you can obtain at the DZIT offices or website.
  • Copy of the commercial registration certificate of the main office and subsidiaries.
  • A copy of the investment permit.
  • Capital deposit certificate.
  • Non-Saudis must present a copy of their passport and residence permit.
  • The Saudis need to deliver a copy of the identity card.
  • You may need a notarized authorization to negotiate on behalf of the taxpayer.

In this way, you will be able to register and you will also obtain a financial number. Like other requirements to open a branch, this one is free and takes 1 to 3 days.

Social Security

An important requirement for opening a new branch of business is to register with social security. In this case, the process must be carried out at the General Organization of Social Security (GOSI). In this way, the employer and the employees will be registered in the two branches of the organization:

  1. The Pension Fund.
  2. The Industrial Illness Fund (or Occupational Risk Fund).

Likewise, if you have doubts about this procedure, we offer you the advice you need. Company Formation Saudi offers you’re a wide variety of services and resources to help you open a branch in Saudi Arabia.

All these formalities are important when you open a branch in Saudi Arabia, as they are essential. One of them, as mentioned above, is a base capital of SAR 500,000. However, this could even increase depending on the particular exercises that the company performs.

Moreover, the foreign company must obtain the respective permission from the Saudi Arabian General Investment Authority (SAGIA). You must also meet the following requirements to complete the process of opening a new branch of business:

  1. Duplicate of the certificate of incorporation.
  2. A duplicate of the articles of association and memorandum of the main company.
  3. A power of attorney, confirmed by the Saudi office.
  4. Certificate of the necessary payments.

With our help, you can complete this process successfully, as we advise you with the documents and the process. Also, your company needs to open a new branch in an area with easy access to your business. In this case, the license will define the said activity, so we can advise you regarding the licenses granted.

This process is carried out at the Saudi Arabian General Investment Authority SAGIA. In addition, you must do so before registering your branch with the Ministry of Commerce and Industry (MOCI). The licensing process consists of three steps and can be completed in as little as 5 days.

Similarly, you should know that this license is extendable for up to 15 years. For this process you need the following:

  • Pay a fee of SAR 2000.
  • Board resolution, declaring its intention to invest in Saudi Arabia.
  • Resolution describing the investment plan, including its economic impact.
  • Document of the financial capacity of the investor.

Bank account

An important aspect when you open a branch in Saudi Arabia is the opening of a bank account. Also, our organization will facilitate this process for your parent company, which is the one that must do it. You can choose between a domestic Saudi bank or a foreign bank establishment.

This bank is where the parent corporation will deposit the capital stock and carry out all financial transactions. Count on our valuable advice, as this process is subject to strict controls and procedures. In addition, it does not require the designation of a bank signatory and cannot be used for commercial operations.

To do this, you will need to have the following documents at hand:

  • Company business license.
  • Registration certificate.
  • Share certificates.
  • Company deed and company bylaws.
  • A resolution of the board to allow an officer of the company to open the account.
  • Copies of passport and residence visa. Both for shareholders and authorized signatories.

Taxes

Saudi Arabia levies the tax on both LLCs and foreign-owned branches. In this sense, the corporate income tax is 20% in addition to the withholding tax (WHT) of 5%. The latter applies to the distribution of interest that is taxed as income.

In addition, income from the business activities of the organization minus eligible expenses is considered taxable income. Likewise, Saudi and GCC citizens will be subject to Zakat, a 2.5% religious tax.

Benefits

There is a range of benefits you can get when you open a branch of your company in Saudi Arabia. Thus, for example, it can participate in the full range of activities within its approved objectives. This branch can also undertake projects in the public and private sectors.

Also, when you open a branch it can promote and solicit business throughout the country. In addition, the process is generally simpler than for a company. It is also similar to the process of establishing a limited liability company.