Procedures for establishing a ...

In this very competitive environment in Saudi Arabia, you want to open your own company or work with your partners, but you do not know the necessary procedures for establishing a company in Saudi Arabia

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Are you looking for everything related to the company establishment contract in Saudi Arabia? Do you not know the difference between the establishment contract and the articles of association?

Read this article where you will find all the answers to your questions in the most accurate details and simplest ways.

Procedures for establishing a company in Saudi Arabia

Once you have decided to establish a company in Saudi Arabia, you must be fully aware of all the basic procedures necessary to establish a company.

I will explain the basic steps: - 

1 - Determine the type of company

Before starting any procedures, you must determine what type of company you want to establish from among all the types of existing companies based on its commercial activity, the purpose of this activity, and the number of its partners.

2 - Reserving a trade name

After determining the company name, you must choose an appropriate trade name that does not conflict with Saudi investment laws is unique, distinctive, and appropriate to the company's activity, and has not been previously registered in the records as well.

3- Preparing the company's articles of association

It is very important that there is a company's articles of association for each company and that it includes all the details of the company, and the most important of these details is that it contains

1_ Company name

2_ Type of company

3_ Purpose and objective of this company

4_ Company capital

5_ Names of partners and their share ratios and method of distributing profits and losses.

4 - Creating a bank account

It is very important to have a bank account for the company and deposit the company's capital and profits according to what is stated in the company's articles of association.

5 - Registering in the commercial register

This is done by submitting a request to register the company in the commercial register and you can do this electronically.

6 - Obtaining licenses

Your company may require some special licenses from different government agencies "such as health, industry" and others depending on the type and activity of the company, so it is very important to complete all the required licenses.

7 - Registering in the Ministry of Human Resources and Zakat

After registering your company, it needs to have a social insurance file. This is done by registering you with the Ministry of Human Resources and Social Development, and to obtain the tax number, you register in Zakat, Tax, and Customs if your company is subject to value-added tax.

8 - Obtaining a Chamber of Commerce Certificate

It is important to join the Chamber of Commerce and have a certificate to prove that you are a member of this company.

9 - Required permits for the headquarters

You need to obtain permits from the municipality responsible for the location your company needs.

Actual start of work

After completing all these procedures properly, you can start practicing your activity legally.

Companies' incorporation contract

It is a basic legal document for the establishment of any company and contains all the terms and conditions through which the company is established.

It is the foundation that regulates the relationship between partners and shareholders in this company and defines their obligations, rights, and functions, the method of distributing profits, withdrawal or transfer procedures between partners, the methods followed to manage the company optimally, and many other items.

The importance of having a company incorporation contract

The company incorporation contract is considered the cornerstone on which any company is based because it

1_ It is the basic legal document that determines the legal form of the company and the nature of its work.

2_ It regulates the relations between partners and shareholders and preserves the rights of each of them.

3_ It determines the obligations required of each person the percentage of contribution and how to distribute profits and losses.

4_ Clarifying the objectives of this company, its purpose, and the clarity of the activity it will practice.

5_It helps in achieving the desired objectives of the company and preserving its interests and the interests of the partners in the long term.

6_In the event of any reasons that lead to the liquidation of the company, it is the primary reference.

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