A MODON industrial licence is the permit issued by MODON — the Saudi Authority for Industrial Cities and Technology Zones — that authorises manufacturing within one of Saudi Arabia’s 35+ designated industrial cities. Foreign investors need two licences: a MISA investment licence first, then the MODON industrial licence. The preliminary licence takes 4–8 weeks from MISA approval. Licence fee: SAR 2,000–5,000. Annual land lease: SAR 25–150 per sqm depending on city.
Note: This guide covers the industrial licence specifically for manufacturing within a MODON industrial city. If you need an industrial licence for manufacturing on private or commercial land outside MODON, see our general industrial licence guide for Saudi Arabia.
For most foreign companies planning to manufacture in Saudi Arabia, MODON is the practical route. MODON manages 35+ industrial cities across Riyadh, Jeddah, Dammam, Yanbu, Qassim, and Sudair — and the MODON industrial licence is the permit that authorises your factory to operate within one of those zones. For a complete guide to business setup in Saudi Arabia beyond the industrial sector, see our full overview.
The licence does not work alone. MODON requires a MISA investment licence as a precondition. Both must be in place before land is allocated or construction begins. This guide walks through both — in the order you need them.
What Is a MODON Industrial Licence?
A MODON industrial licence is an official permit that authorises a company to manufacture, produce, or operate industrial facilities within a MODON-managed industrial city in Saudi Arabia. It is issued by MODON directly and is distinct from a commercial licence — it is tied to a specific physical plot within a MODON zone and grants the holder the right to construct, operate, and export from that facility.
The licence works alongside — not instead of — a MISA investment licence. Foreign investors need both before any land allocation or construction activity can begin. MODON will not issue an industrial licence without MISA approval.
Types of MODON Industrial Licences in Saudi Arabia
MODON issues four categories of industrial licence depending on the scale, stage, and nature of your manufacturing operations:
| Licence Type | Who It Is For | Validity | Key Feature |
|---|---|---|---|
| Full Industrial Licence | Fully operational factories with confirmed land and completed feasibility | 5 years, renewable | Required before production can legally begin |
| Preliminary Industrial Licence | Investors completing pre-construction requirements | Until project completion | Converts to Full Licence after MODON inspection |
| SME Industrial Licence | Small and medium enterprises with reduced capital | As per standard MODON terms | Aligned with the National Industrial Development Programme |
| Technology Zone Licence | R&D, advanced manufacturing, and high-technology production | As per standard MODON terms | For MODON-managed technology zones specifically |
Most foreign investors entering Saudi Arabia for the first time start with a Preliminary Industrial Licence and convert to a Full Licence once the facility is built and passes inspection.
MODON Industrial Cities — Where Can You Operate?
The city you choose affects your land costs, logistics, sector fit, and available infrastructure. The main MODON industrial cities for foreign investors are:
| Industrial City | Region | Key Sectors |
|---|---|---|
| Second Industrial City, Riyadh | Central | Chemicals, plastics, food processing |
| First Industrial City, Jeddah | Western | Textiles, packaging, electronics |
| Jubail Industrial City | Eastern | Petrochemicals, metals, heavy industry |
| Yanbu Industrial City | Western | Refining, plastics, maritime supply chain |
| Sudair City for Industry and Business | Central | Logistics, light manufacturing |
| Jazan Economic City | Southern | Agri-processing, metals, mining |
City selection is a strategic decision — it affects operational costs, logistics access, and your regulatory pathway. Analytix advises on the right city for your sector as part of the initial feasibility review. Once your licence is approved and your site is confirmed, see our guide to setting up your factory in a MODON industrial city for the next steps.
Who Can Apply for a MODON Industrial Licence in Saudi Arabia?
Foreign investors can apply for a MODON industrial licence and can own 100% of the Saudi entity in most manufacturing sectors — no Saudi partner is required. Eligibility criteria:
- The applicant must hold, or be actively obtaining, a valid MISA investment licence — this is the precondition for all MODON applications
- The proposed activity must appear on MODON’s approved industrial activities list — Analytix confirms this before submission
- Minimum paid-up capital: SAR 1 million for most activities; higher thresholds apply to restricted sectors
- Nitaqat (Saudisation) compliance: a minimum Saudi workforce percentage must be committed at application stage — our PRO services team manages ongoing Nitaqat compliance after launch
- Certain sectors — petrochemicals, defence, upstream oil — require additional MODON and MISA approval tiers and may have foreign ownership restrictions
GCC nationals have a facilitated pathway under GCC bilateral agreements. Confirm your eligibility with Analytix before submitting any application.
Documents Required for a MODON Industrial Licence
The standard documentation package for a foreign investor applying for a MODON industrial licence:
- Completed MODON licence application form — submitted via the MODON portal
- Valid MISA investment licence or MISA approval letter
- Commercial Registration (CR) — see our commercial registration guide for the full process
- Feasibility study covering production capacity, raw materials, employment projections, and export plan
- Site layout and facility plans (where land has already been allocated)
- Environmental Impact Assessment (EIA) where applicable to the activity type
- Board resolution authorising the licence application — notarised and apostilled
- Passport copies of directors and authorised signatories
All foreign documents must be attested by the Saudi Embassy in your country of origin and legalised by the Saudi Ministry of Foreign Affairs. Analytix’s PRO services team handles all document attestation, legalisation, and government liaison — this is one of the most time-sensitive parts of the process and benefits from experienced handling.
MODON Industrial Licence Application Process — Step by Step
The MODON industrial licence follows a structured 8-step pathway. Total time from MISA application to preliminary licence: 4–8 weeks for a straightforward case. Complex cases involving EIA requirements or restricted sectors take longer.
| Step | Action | Typical Duration |
|---|---|---|
| 1 | Obtain MISA investment licence | 3–7 working days (online application) |
| 2 | Select MODON industrial city and confirm activity classification | 1–2 weeks (feasibility stage) |
| 3 | Submit MODON industrial licence application via portal | 1 working day |
| 4 | MODON technical review of application and documents | 5–10 working days |
| 5 | Land allocation and lease agreement signed with MODON | 2–4 weeks |
| 6 | Preliminary industrial licence issued | 1–3 working days post-approval |
| 7 | Construction and facility fit-out | Variable — depends on factory size and spec |
| 8 | MODON inspection and full industrial licence issuance | 5–15 working days post-inspection |
Analytix’s GRO services team tracks applications across MODON, MISA, and the Ministry of Commerce to make sure no stage stalls. Once construction is complete and your full licence is issued, the next step is activating operations — see our MODON Saudi Arabia factory setup guide for what comes after the licence.
MODON Industrial Licence Costs in Saudi Arabia (2026)
Licensing fees are set by MODON and subject to annual revision. The figures below are indicative as of 2026, based on published schedules at modon.gov.sa and misa.gov.sa. Exact fees are confirmed at the point of application.
| Cost Item | Low | High | Notes |
|---|---|---|---|
| MODON industrial licence application fee | SAR 2,000 | SAR 5,000 | Varies by licence type (Full, Preliminary, SME, Tech Zone) |
| Annual land lease | SAR 25/sqm | SAR 150/sqm | Riyadh and Jeddah at the top; Sudair and Jazan at the low end |
| MISA investment licence fee | SAR 2,000 | SAR 10,000 | Varies by activity classification and entity type |
| Document attestation and legalisation | SAR 1,500 | SAR 4,000 | Per document set — depends on country of origin and number of directors |
| Environmental Impact Assessment (if required) | SAR 8,000 | SAR 40,000 | Only for activities with emissions, hazardous materials, or chemical processes |
These figures cover licensing and land only — not construction, fit-out, machinery, or working capital. Analytix’s accounting and bookkeeping team provides a full cost projection as part of the initial consultation.
MODON Industrial Licence vs Direct Manufacturing Licence
Some investors ask whether they must operate within a MODON industrial city or whether manufacturing on private or commercial land is an option. The table below clarifies the distinction.
| Factor | MODON Industrial Licence | Direct Manufacturing (Outside MODON) |
|---|---|---|
| Location | Within a MODON-managed industrial city | Private land or commercial zone of your choosing |
| Infrastructure | Roads, utilities, and drainage provided by MODON | Investor is responsible for all infrastructure connections |
| Land | Leased from MODON at subsidised rates | Must be independently sourced and purchased or leased |
| Incentives | Subsidised utilities, reduced fees, IKTVA supply chain recognition | Standard commercial rates — no MODON-specific incentives |
| Approval body | MODON + MISA | MISA + Ministry of Commerce + relevant municipality |
| Typical use case | Large-scale or capital-intensive manufacturing | Small-scale, specialised, or location-specific production |
For most foreign companies in manufacturing, MODON offers a more incentivised and administratively straightforward route than manufacturing on private land. Companies requiring vendor registration alongside their industrial licence will also benefit from MODON’s IKTVA-recognised status, which is recognised by Saudi Aramco and major government supply chains.
Pros and Cons of the MODON Industrial Licence Route
| ✓ Advantages | ⚠ Challenges |
|---|---|
| Ready infrastructure — roads, utilities, and logistics are already in place within established cities | Land allocation in Riyadh and Jeddah is competitive — waitlists exist in prime zones |
| Subsidised land rates compared with private commercial real estate in equivalent locations | The Full Licence requires construction completion — timeline depends on factory size and is not fixed |
| Single regulatory contact point — MODON coordinates with MISA, GAMEP, and municipalities on your behalf | Nitaqat Saudisation requirements must be met before operations can commence |
| Eligible for Vision 2030 industrial incentives and export support programmes | Environmental permits add 4–8 weeks for chemical, heavy, or hazardous manufacturing activities |
| IKTVA-recognised supply chain locations — useful for investors targeting government and energy sector clients | Annual reporting to both MODON and MISA must be maintained; failure to report can affect renewal |
How Analytix Supports Your MODON Industrial Licence Application
Analytix handles the end-to-end MODON industrial licence process for foreign investors — from initial eligibility assessment through to full licence issuance and operational launch.
Analytix has supported 500 foreign investors through the MODON industrial licence process across Riyadh, Jeddah, Dammam, Yanbu, and Sudair industrial cities.
What we handle:
- MISA investment licence application — portal submission, document preparation, and ministry follow-up. See our MISA licence guide for eligibility and timelines
- MODON industrial licence application — activity confirmation, portal submission, technical review support, and land allocation coordination
- Document attestation, legalisation, and notarisation via our PRO services team — including Saudi Embassy attestation and Ministry of Foreign Affairs legalisation
- Company registration — LLC company formation and commercial registration (CR) to establish the Saudi entity required to hold the licence
- Ongoing compliance — GRO services for government liaison and application tracking, and accounting and bookkeeping to keep your entity compliant with MODON and MISA annual reporting
Once your MODON industrial licence is approved and your land is allocated, the next step is the factory itself. See our complete guide to setting up a factory in a MODON industrial city in Saudi Arabia — covering site selection, construction permits, costs, and pre-operations inspection.
If you are based in the UAE, Qatar, Bahrain, Kuwait, or Oman and planning to manufacture in Saudi Arabia, contact Analytix via our business setup in Saudi Arabia page for a free consultation.
- FAQs
Frequently Asked Questions
If your question is not addressed here, please feel free to reach out to us. We value your inquiry.
What is a MODON industrial licence in Saudi Arabia?
A MODON industrial licence is the permit issued by MODON — the Saudi Authority for Industrial Cities and Technology Zones — that authorises a company to manufacture or operate an industrial facility within one of Saudi Arabia’s 35+ MODON-managed industrial cities. It is separate from a commercial licence and must be held alongside a MISA investment licence.
Do foreign investors need both a MISA licence and a MODON industrial licence?
Yes. The MISA investment licence authorises the foreign investment and must be obtained first. The MODON industrial licence then authorises the specific manufacturing activity and allocates land within the industrial city. Neither replaces the other — both are required before operations can begin.
How long does it take to get a MODON industrial licence?
For a straightforward case, the timeline from MISA application to MODON preliminary licence is 4–8 weeks. The full licence — which requires construction completion and a formal MODON inspection — depends on project scope and cannot be fixed in advance. Ready-built units reduce this significantly.
What is the minimum capital requirement for a MODON industrial licence?
The minimum paid-up capital for most foreign investors is SAR 1 million (approximately USD 267,000). Higher thresholds apply for restricted or strategic sectors. MISA publishes updated capital requirements by activity type and Analytix confirms the applicable threshold before incorporation.
Can a foreign company own 100% of a Saudi manufacturing entity?
Yes, in most industrial sectors. Saudi Arabia’s Foreign Investment Law permits 100% foreign ownership across the majority of manufacturing activities. Certain strategic sectors — including defence and upstream oil — retain restrictions. Analytix confirms ownership eligibility for your specific activity before incorporation.
What is the difference between a Preliminary and a Full MODON industrial licence?
The Preliminary Licence is issued when pre-construction requirements are met but the facility is not yet built. It authorises construction to begin. The Full Licence is issued after the facility passes MODON’s formal inspection, confirming that production may legally commence.
Which MODON industrial city is best for foreign investors?
It depends on your sector and logistics needs. Riyadh’s Second Industrial City suits consumer goods and light manufacturing. Jubail suits petrochemicals and heavy industry. Jeddah suits export-focused production given its proximity to Jeddah Islamic Port. Sudair and Qassim offer more land availability at lower lease rates for investors where coastal access is not a priority. Analytix advises on city selection during the initial feasibility consultation.
