Branch vs Subsidiary vs LLC in Saudi Arabia 2026

Foreign investors weighing entry into the Saudi market in 2026 face an early decision: register a branch of the parent company, or establish a separate Saudi entity as a subsidiary (an LLC). In all cases, an investment license from وزارة الاستثمار must be obtained through the InvestSaudi portal before setup begins.

A branch is not a separate legal entity; it operates under the same identity and name as the foreign parent, adding “Branch of a Foreign Company.” The parent typically must have been operational for at least three years and provide audited financial statements for two to three years. Required documents—including the certificate of incorporation, articles of association, board resolution, and power of attorney—must be notarized, legalized at the Saudi embassy, and translated into Arabic. Once the branch license is issued (usually within three to ten business days when paperwork is complete), the company obtains its Commercial Registration through the Ministry of Commerce.

A subsidiary, by contrast, is a separate Saudi legal entity structured as an LLC, with liability limited to paid-in capital and its own Commercial Registration. In 2026, foreign investors can generally own 100% of an LLC for permitted activities, with a minimum of one shareholder.

Costs and registrations

The typical Commercial Registration government fee sits at around 1,825 ريال سعودي, rising to about 2,100 ريال سعودي depending on entity type. Annual CR renewal runs roughly 1,200 ريال سعودي, plus Chamber of Commerce membership between 2,000 and 10,000 ريال سعودي by grade. Notably, MISA license issuance and renewal government fees are suspended in 2026.

After setup, companies complete core registrations with the Chamber of Commerce, ZATCA, GOSI, قوى, مقيم, and a Wasel national address, along with opening a corporate bank account. A verified physical address is required, with municipal licensing handled where applicable through Balady.

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