Travel and tourism is one of the fastest-growing sectors in Saudi Arabia, thanks to the government’s Vision 2030 plan that aims to diversify the economy and promote the country as a global destination. Therefore, setting up a tourism company in Saudi Arabia is becoming an extremely profitable business. The demand for travel and tourism services is expected to increase as the kingdom opens up to foreign visitors and relaxes its social norms.
In this article, we will guide you through the steps and requirements for setting up your business legally and successfully. If you are interested in tapping into this lucrative market, you will need to obtain a license from the Ministry of Tourism (MOT) to operate a travel and tourism company in Saudi Arabia.
Why Travel and Tourism Company in Saudi Arabia
Saudi Arabia has a lot to offer to travelers, from its rich cultural heritage and religious sites to its modern cities and natural wonders. The kingdom has been investing heavily in developing its tourism infrastructure. For example, airports, hotels, resorts, entertainment venues, and cultural attractions. Some of the recent initiatives include:
- Launching a new tourist visa that allows visitors from 49 countries to enter Saudi Arabia for up to 90 days.
- Opening up historical and archaeological sites, such as AlUla, Diriyah, and Mada’in Saleh, to the public.
- Hosting international events, such as Formula 1, Dakar Rally, Red Sea International Film Festival, and Riyadh Season.
- Developing mega-projects, such as NEOM, Qiddiya, Amaala, and Red Sea Project, that will offer world-class facilities and experiences for tourists.
- Supporting local entrepreneurs and SMEs in the tourism sector through various programs and incentives.
Remember that if you are already working in the country you need to do your visa status check before thinking about a new business. Once you have verified your status you can start planning your tourism company in KSA.
Nonetheless, by setting up a travel and tourism company in Saudi Arabia, you can benefit from the growing demand for travel services. For example, flights, hotels, tours, activities, car rentals, visas, insurance, etc. You can also cater to different segments of the market. Such as, leisure travelers, business travelers, religious pilgrims, adventure seekers, etc.
Does the Kingdom of Saudi Arabia (KSA) offer more than architecture and international events? The answer is yes. This is a very religious country and many travel and tourism companies in KSA offer a lot of tours around its more important landmarks.
Touristic spots in Saudi Arabia
- The Two Holy Mosques, Makkah and Madinah
These are the holiest sites for Muslims, where millions of pilgrims visit every year to perform Hajj and Umrah. The Masjid al-Haram in Makkah is the biggest mosque worldwide and is the one surrounding the Kaaba. The sacred cube-shaped structure that Muslims face when they pray. Additionally, the Al-Masjid an-Nabawi in Madinah is the second-largest mosque in the world and houses the tomb of Prophet Muhammad (PBUH)
- Abraj Al-Bait Towers, Makkah
This is a complex owned by the government with several skyscraper hotels nearby Masjid al-Haram. It features a four-faced clock, which happens to be the one in the highest position in the world. Furthermore, the complex also has residential apartments, shopping centers, hotels, and a prayer area that can accommodate thousands of worshippers.
- Kingdom Centre, Riyadh
This is an iconic structure in the capital city of Riyadh, standing at nearly 300 meters tall. It is home to various offices, restaurants, entertainment options, luxury brands, a five-star hotel, and lavish apartments. At the top of the tower is the SkyBridge, a 300-ton steel structure that offers a panoramic view of the city.
- Al Balad, Jeddah
This is the historical area of Jeddah, known for its traditional markets, narrow lanes, ornate mosques, and old houses. It is part of the UNESCO list of world heritage sites. This place was once the meeting point for the religious heading to Makkah. Al Balad showcases the rich cultural heritage of Saudi Arabia and its diverse influences from Africa, Asia, and Europe.
- Edge of The World, Riyadh
This is a natural attraction that offers a breathtaking view of the desert landscape from a cliff edge. It is located about 90 kilometers from Riyadh and requires a four-wheel drive to reach. The Edge of The World is a popular spot for hiking, camping, and picnicking.
Step By Step Guidance for Obtaining Travel and Tourism Company License in KSA
If you are a foreigner starting a business in Saudi Arabia or a national you need to accomplish some guidelines. To obtain a travel and tourism company in Saudi Arabia license, you shall follow these steps:
- Choose a legal form for your company.
You can either establish a limited liability company (LLC) or a branch of a foreign company. An LLC requires at least two shareholders (one must be a Saudi national) and a minimum capital of SAR 500,000. A branch of a foreign company requires a minimum capital of SAR 100,000 and a local agent or sponsor.
- Register your company name with the Ministry of Commerce and Investment (MCI).
You will need to provide a copy of your ID or passport, a letter from your local agent or sponsor (if applicable), and a fee of SAR 200.
- Apply for a commercial registration (CR) with the MCI.
You will need to provide your company name certificate. Articles of association or branch agreement (if applicable). Your lease contract or ownership deed for your office premises. A bank certificate showing your capital deposit. Your shareholders’ IDs or passports, your local agent’s or sponsor’s ID or passport (if applicable), and SAR 2,000 fee.
- Apply for a membership with the Chamber of Commerce and Industry (CCI) in your region.
You will need to provide your CR certificate. Your lease contract or ownership deed for your office premises, your shareholders’ IDs or passports. Also, you will need your local agent’s or sponsor’s ID or passport (if applicable), and a fee of SAR 500.
Steps in order apply for licenses
- Apply for a travel and tourism license with the MOT.
You will need to provide your CR certificate, your CCI membership certificate, your lease contract or ownership deed for your office premises. Your bank guarantee of SAR 100,000. A professional liability insurance policy of SAR 1 million. Your proof of hiring at least four qualified Saudi Arabia tour operators or employees in general. A proof of hiring at least one qualified manager with a bachelor’s degree in tourism or related fields. Additionally, your proof of completing the MOT training course on travel and tourism regulations, and a fee of SAR 5,000.
- Apply for an e-service account with the MOT.
You will need to provide your CR certificate, your CCI membership certificate, your travel and tourism license certificate, and your email address.
- Apply for an IATA accreditation with the International Air Transport Association (IATA).
You must provide your CR certificate, your CCI membership certificate, your travel and tourism license certificate. Furthermore, your bank guarantee of SAR 100,000. Your professional liability insurance policy of SAR 1 million. The proof of hiring at least four qualified Saudi employees or Saudi Arabia tour operators. Your proof of hiring at least one qualified manager with a bachelor’s degree in related fields. And finally, a proof of completing the IATA training course on travel agency operations with a fee of SAR 10,000.
Following this step-by-step guide to business setup in Saudi Arabia you are likely to succeed in the market.
How to Apply for Travel and Tourist Activities’ Licenses in KSA
In addition to the travel and tourism company license in Saudi Arabia, you may also need to obtain specific licenses for certain travel and tourist activities, such as:
- Tour operator license:
This allows you to organize and sell tour packages within Saudi Arabia or abroad. You will need to provide your CR certificate, your CCI membership certificate, your travel and tourism license certificate. Also, a bank guarantee of SAR 200,000 and your professional liability insurance policy of SAR 2 million. Furthermore, your proof of hiring at least six Saudi employees and proof of hiring at least one qualified tour guide with a bachelor’s degree on related fields. Moreover, your proof of completing the MOT training course on tour operator regulations, and a fee of SAR 10,000.
- Tour guide license:
This allows you to guide tourists within Saudi Arabia. You will need to provide your ID or passport, your CV, your bachelor’s degree on fields with a relation to tourism. Adittionally, you will need to provide a proof of completing the MOT training course on tour guide regulations, and a fee of SAR 500.
Steps for religious tourism
- Umrah operator license:
This allows you to organize and sell Umrah packages for pilgrims within Saudi Arabia or abroad. Additionally, you will need to provide your CR certificate, your CCI membership certificate, your travel and tourism license certificate. Your bank guarantee of SAR 500,000 and your professional liability insurance policy of SAR 5 million. Your proof of hiring at least 10 Saudi employees. The proof of hiring at least one manager with a bachelor’s degree in tourism or similar majors. Your proof of completing the Ministry of Hajj and Umrah training course on Umrah operator regulations, and a SAR 25,000 fee.
- Hajj operator license:
This allows you to organize and sell Hajj packages for pilgrims within Saudi Arabia or abroad. Again, you will need to provide your CR certificate, your CCI membership certificate, your travel and tourism license certificate. Your bank guarantee of SAR 1 million, your professional liability insurance policy of SAR 10 million. Additionally, your proof of hiring at least 20 Saudi employees, your proof of having least one manager with a bachelor’s degree in tourism or close fields. Your proof of completing the Ministry of Hajj and Umrah training course on Hajj operator regulations, and a fee of SAR 50,000.
Government Support and Incentives for Tourism Companies in Saudi Arabia
One of the reasons why Saudi Arabia is an attractive destination for travel and tourism entrepreneurs is the government’s support. Since they offer incentives for this sector considering how big tourism in the Islamic nation is. The reason why there are so many travel companies Saudi Arabia nowadays is something we can thank the government for.
Furthermore, they have launched several initiatives and programs to facilitate the establishment and operation of tourism businesses. Such as:
A. Available Governmental Assistance
- The Saudi Tourism Authority (STA) is the main body responsible for regulating, developing, and promoting the tourism sector in Saudi Arabia. The STA provides various services and resources for tourism businesses. Such as, licensing, training, marketing, research, and events.
- The Tourism Development Fund (TDF) is a financial institution that offers loans and guarantees for tourism projects and businesses. The TDF aims to support the development of tourism infrastructure, facilities, and services in Saudi Arabia.
- The General Authority of Civil Aviation (GACA) is the authority that oversees the aviation sector in Saudi Arabia. GACA regulates the air transport industry, including airlines, airports, and air navigation services. GACA also offers incentives and subsidies for domestic flights and routes that serve tourist destinations.
B. Incentives for Travel and Tourism Companies
- The government offers various tax exemptions, like the withholding tax or others, and reductions for tourism businesses. Such as income tax exemption for 10 years, customs duty exemption for imported equipment and materials. Also, they offer a value-added tax (VAT) exemption for tourism services, and zakat exemption for tourism projects.
- Moreover, the government offers land grants and leases for tourism projects. Such as hotels, resorts, entertainment centers, and cultural sites. However, the land grants and leases are subject to certain conditions and criteria. Such as location, size, investment value, and environmental impact.
- Additionally, the government also offers subsidies and discounts for utilities and services for tourism businesses. For example, electricity, water, gas, telecommunications, internet, waste management, security, and maintenance.
C. Support Networks and Associations
- There are several associations and organizations that represent and support the travel and tourism industry in Saudi Arabia, such as the Saudi Commission for Tourism and National Heritage (SCTH), the Saudi Travel Agencies Association (STAA), the Saudi Hotel Association (SHA), the Saudi Exhibition and Convention Bureau (SECB), and the Saudi Entertainment Industry Association (SEIA).
- These associations and organizations provide various benefits and opportunities for their members. Such as networking, advocacy, training, certification, accreditation, marketing, events, awards, and recognition. They facilitate the set-up of your tourism company in Saudi Arabia.
Setting up a travel and tourism company in Saudi Arabia, or any other kind of company in Saudi Arabia can be a rewarding venture. As the sector is booming and offers many opportunities for growth and innovation.
You can also benefit from the government’s support and incentives for this sector, as well as from the support networks and associations that represent and support the industry. By doing so, you can contribute to the growth and development of the travel and tourism sector in Saudi Arabia.
However, you will need to comply with the legal and regulatory requirements, as well as the quality and safety standards, to operate your business successfully. By following the steps and guidelines you can obtain a license for your travel and tourism company in KSA. Therefore, you will be able of offering your services to the market. However, if you need more information you can always contact us and we will be happy to lend a hand.