Thinking of Registering a Business in Saudi Arabia? Start Here

A list one might get every time is: paperwork, delays, laws that do not even make sense, and yet more paperwork. Until recently, Saudi Arabia was not any different. But all that has just changed. 

In the month of February 2025, a Royal Decree, M/19, came into effect, which is a brand-new investment law. It totally replaced the older system that was, by then, practically cruelly slow, having existed since 2000. This winds up being more than a minor bureaucratic reshuffling; it is a very concrete measure toward making Saudi Arabia a better place to invest and build companies. Especially for those who are thinking of company formation in KSA. 

A Shift in Mindset, Not Just in Policy 

Before, foreign investors had to follow a separate path. Local and international businesses weren’t always on equal footing. Now? That gap is gone. The new law applies the same standards and rights to all investors, regardless of nationality.

This applies across the board, even in special economic zones, which used to operate under slightly different setups. If you’re putting money into a Saudi venture today, you’re playing by the same rulebook as everyone else. 

Say No to Licenses and Yes to Register 

The most important part about business is licenses or paperwork so let's see the vital point of it. Before the reform, investors had to secure a license from the Ministry of Investment. It was a necessary hurdle, but a hurdle for all kinds of sectors. Now, that requirement is gone. All you need to do is register through a government platform online. Submit your info. Wait a few business days. And just like that, you’re legally cleared to operate. For anyone who’s struggled with red tape in the past, this change alone is huge. 

Some Industries Still Have Fences

The new law doesn’t mean it’s a free-for-all. Certain sectors like defence, religious sites, and pilgrimage-related services remain off-limits. But now, those boundaries are clearly defined. You can check the restricted list before you even begin, which makes planning much easier. 

What About Investor Protection? 

When you invest in another country, you want some assurance that your money and your ideas are safe. The new law includes: 

• The right to move profits and capital freely
• Protection from expropriation (no one’s taking your assets without cause) 
• Legal options like arbitration and court access 
• Strong rules around intellectual property and confidentiality 

This gives both startups and seasoned companies a lot more breathing room. You can operate knowing that the system isn’t out to trap you with surprise rulings or red tape. 

Penalties That Fit the Situation

No business is perfect. Mistakes happen. The previous law didn’t always take that into account. The updated version does. There’s now a system that considers how serious the violation is, how often it’s happened, and what kind of business is involved. Small infractions won’t sink small companies. Big ones still get penalised. But the approach is far more balanced and you can appeal if needed. 

Special Economic Zones Still Shine

Till 2023, there were five SEZs across the Kingdom. These zones continue to offer perks: 

• Corporate tax reductions that can last up to two decades 
• Zero customs duties and VAT inside the zone 
• Easier visa processes and waived fees for foreign workers (at least in the early years)
• Guaranteed freedom to send profits back home 

If you’re launching something in tech, logistics, or industrial manufacturing, setting up in an SEZ might make the most sense. 

So, What Do the Numbers Say?

Between 2017 and 2022, foreign direct investment into Saudi Arabia rose by over 300%. In 2022 alone, the Kingdom pulled in SAR 123 billion, roughly 3% of GDP. That dropped a bit to SAR 96 billion in 2023, but the momentum continues. 

Manufacturing, retail, and finance are leading the way. The biggest investors? The UAE and the United States. 

Looking Ahead: Vision 2030 in Action 

Saudi is aiming for a staggering $100 billion FDI per year up to 2030. A lofty aim, but by no means impossible. NEOM and Diriyah Gate are some of the major projects that have gotten the infusion of cash from the Public Investment Fund. While global oil prices have been rather weak, the country's health remains sturdy and there is an undying investor interest. 

If You’re Ready to Register a Company, Here’s What You’ll Do

Choose your business activity. Make sure it’s not on the restricted list. 

1. Complete your registration through the official investment portal.
2. Receive your commercial certificate. 
3. Apply for any extra permits if required. 
4. Start operating. That’s it, no separate license needed. 
5. If you’re in an SEZ, claim the benefits available. 

Conclusion 

The new Investment Law is proof of Saudi Arabia's commitment to create a sustainable, fair and attractive investment climate. The law makes it easier to start a business, protects the rights of participants, regulates liability, and encourages entry into key industries through SEZ. 

This is not just a legal document, it is a launching pad for growth. Everyone who is ready to start business in saudi arabia or expand their activities in the region now gets the best conditions: rapid registration, high degree of protection and clarity of laws.