Saudi Arabia

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Operating a Business in Saudi Arabia

Types of companies and capital (max/min)	Number of partners/shareholders and liability	Registration fees
The Sole Proprietorship is a single-partner company. No minimum capital.	1 person The individual entrepreneur is liable for debts the company on his personal possessions.	SAR 200
Sharikat Al-Mossahamah (S.A.M) is a Public Limited Company. Minimum SR 2 million. If the capital is open to the public, Minimum SR 10 million.	Minimum 5 partners. Liability is limited to the amount contributed.	SAR 1.600
SHARIKAT ZAT MASSOULIYYAH MAHDOOAH (S.M.M) is a Private Limited Company. Minimum SR 500,000, but in practice, rarely less than SR 1 million.	Minimum 2 partners. Maximum 50 partners. Liability is limited to the amount contributed.	SAR 1.200
Sharikat Tadhamou is a General Partnership Company No minimum capital.	Minimum 2 partners. Liability is unlimited.	SAR 800
Sharikat Tawsiyah Bel-ashom - Ashom is a partnership limited by shares. Minimum SR 100,000. At least 50% issued at the registration.	Minimum 2 partners. At least one partner must have an unlimited liability. Liability of other partners is limited to the amount contributed.	SR 1.600

Business setup procedures: The Ministry of Commerce and Industry has to issue a license to any new business. In case of banking companies the Ministry of Finance.

For more details, refer to: 'Applications and Procedures', Saudi Ministry of Commerce and Industry
The competent organization: Ministry of Commerce and Industry

Ministry of Finance

Department of Zakat and Income Tax

Legal weekly duration: 8 hours a day or 48 hours a week. The number of working hours may be raised to 9 hours a day where the workman does not work continuously, such as seasonal establishments, hotel, snack bars, restaurants, etc.
Retirement age: 60 years for men and 55 years for women.
Working contracts: Broadly there are two types of contracts: Permanent and Fixed-term.

Majority of the contacts for foreigners in the labor sector are of fixed-term, while as for the locals these are of permanent type.

The number of 'temporary contracts' is very low.

Minimum wage: No minimum wage standard
Average wage: Average monthly gross earnings is SAR 2,461 (USD 656).
Social contributions: Social security contributions paid by employers: 11%
Social security contributions paid by employees: 9%

Social dialogue and involvement of social partners: The labor law does not provide for collective bargaining. However, the companies that employ more than 100 Saudis are allowed to form "labor committees." There are 15 labor committees registered in the Kingdom.
Unions
Labor regulation bodies: Ministry of labor

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