Thinking of setting up a manufacturing business in Saudi Arabia and do not know where to begin? Worry not! With over a decade of expertise in the Saudi Arabian Business landscape and as an on-ground partner for entrepreneurs and investors in the kingdom, Analytix is here to paint the whole picture with this comprehensive blog to help you begin your journey of starting a manufacturing business in Saudi Arabia.
Manufacturing is one of the most important and rapidly growing industries in Saudi Arabia. The kingdom has made massive efforts to make headway towards opening up its manufacturing market to international/foreign investors. The Saudi Government, keen on diversifying the kingdom’s economy and growing beyond oil dependency, has launched several incentives to attract investors worldwide to the manufacturing industry and offer greater opportunities.
Requirements for Starting a Manufacturing Company in Saudi Arabia
The Kingdom of Saudi Arabia offers plenty of opportunities for investors and businesses to thrive and grow in the manufacturing industry. Therefore the businesses are required to completely understand the relevant requirements that MISA (Ministry of Investment Saudi Arabia) will request for the review to approve the application of the company or business.
However, let us take a look at the requirements the companies need to fulfil to start a manufacturing company in Saudi Arabia.
- A licensed manufacturing company in Saudi Arabia can be filly or solely owned by a foreign shareholder who is a non-Saudi national.
- A manufacturing license issued by the Ministry of Investment in Saudi Arabia (MISA) to foreign businesses and individual shareholders.
- An enterprise can obtain the industry license as:
1. a subsidiary of a foreign company
2. a branch
- The parent company must demonstrate good financial position/capacity through the submission of the audited financial statements.
- Companies should have a nominal share capital concerning the size of their operation in Saudi Arabia.
- Businesses must sell at least 30 percent of the production within the kingdom.
- Companies can sell their produced goods to businesses and distributors within the kingdom with a manufacturing license.
How to Start a Manufacturing Business In Saudi Arabia
- All entrepreneurs/investors who aspire to establish a manufacturing business in Saudi Arabia will have many questions in their minds such as where, when, and how to begin with. Here, we are going to discuss the important steps for setting up a manufacturing business in Saudi Arabia.
- All foreign/non-GCC national-owned businesses should get their company documents legalized and attested by the Saudi Arabian Embassy.
- As a first step, businesses should obtain a manufacturing license from the Ministry of Investment for Saudi Arabia (MISA).
- After procuring a manufacturing license, the company must be registered with the Ministry of Commerce, Saudi Arabia.
- Afterwards, the company is required to secure:
- a land contract for the manufacturing facility.
- essential building permits from the Municipality
- Subsequent to that, a final industrial license is issued by the Ministry of Industry and Mineral Resources.
- Thereafter, the company must complete all the relevant environmental permits.
- After completing the commercial registration (CR), businesses must obtain certain additional registrations from external government departments such as labour file opening and tax registration.
- Following this, the manufacturing companies/business will be fully operational in order to recruit staff, open a company bank account and conduct transactions, invoice the customers, etc.
- Companies and Investors should take good care of all the necessary documents and requirements required to begin their manufacturing business in KSA. Hope you are all clear with the step-by-step procedure for this.
Approvals Required for Starting a Manufacturing Business in Saudi Arabia
The approval for all manufacturing licenses are granted by the Ministry of Industry and Mineral Resources, the regulatory body for all industrial and mining-related licenses in the kingdom.
Now let us dive deep into the list of approvals and licenses from various government departments of the kingdom, necessary for starting a manufacturing business in Saudi Arabia.
- Commercial Registration(CR): Primarily, the business should be registered with the Ministry of Commerce and Investment in order to obtain a commercial registration( CR) certificate.
- Manufacturing license: The businesses must secure a manufacturing license from the Ministry of Investment of Saudi Arabia (MISA).
- Municipal License: This license is issued by the local municipal authority where the business factory is located. The municipality issues the license in compliance with the local laws and zonal regulations.
- Environmental permits: There are several environmental standards issued by the General Presidency of Meteorology and Environmental Protection and manufacturing licenses in the kingdom must be in compliance with those standards. These environmental standards ensure that every manufacturing firm will try to dispose, remove and minimize all potential environmental hazards.
- Industrial license: The final industrial license is issued by the Ministry of Industry and Mineral Resources. The ministry is responsible for granting licenses for industrial firms across the 13 administrative regions within the country.
Analytix Help You In Setting Up Your Manufacturing Business In KSA
As we have discussed in this blog, there are several important factors to be considered, procedures to be followed and things to be taken care of when setting up your manufacturing firm in Saudi Arabia.
It might leave you concerned and confused, but you need not worry. Analytix is here, as your on-ground partner for providing complete and holistic support for your manufacturing businesses entering the Saudi market. Our expert team of highly experienced professionals and advisors will help you with the proper guidance about every single aspect of your business setup.
Analytix is here to deliver you the high-quality business services required for establishing your manufacturing business in the kingdom. We promise to make it all simple, easy and perfect. Fill out the contact form below and get in touch with us now.
Conclusion
So, did you enjoy reading our blog?
We hope you got a clearer picture of guidance on starting a manufacturing business in Saudi Arabia?
If you think that we have missed out on something or would like to read more about any other important points, please let us know in the comments.
Happy reading!
