Branch vs Subsidiary vs LLC in Saudi Arabia 2026

Foreign companies looking to enter the Saudi market in 2026 generally choose one of three legal structures: a branch of the parent company, a subsidiary, or a limited liability company (LLC). Each option carries a different level of liability, capital requirement, and government cost, and choosing the right one matters for both risk and setup budget.

The main difference lies in legal identity. A branch of a foreign company keeps the same legal identity as its parent, meaning the parent is fully liable for the Saudi operations. A subsidiary is usually structured as a Saudi LLC with its own legal personality, so liability is limited to its paid-up capital. A standalone LLC — whether locally or foreign-owned — is a separate company under Saudi law, with shareholder liability capped at the invested capital.

Capital requirements

Minimum capital varies by activity and by the license issued by the Ministry of Investment. For a foreign branch, the typical minimum is around SAR 500,000 in many sectors. A foreign-owned LLC or subsidiary also often requires around SAR 500,000, though this can be higher or lower depending on the licensed activity. Market guidance still cites a minimum of about SAR 25,000 for simple local LLCs, but foreign-investment activities usually require higher capital.

Government fees

Core commercial registration service fees include SAR 1,200 for an LLC, SAR 1,600 for a joint-stock or simplified joint-stock company, and SAR 1,000 for a general partnership. New commercial registration issuance carries a base fee of roughly SAR 1,825, rising to about SAR 2,100 depending on entity type, with renewal generally in the same range.

For a foreign branch, the investment license e-service fee is SAR 1,600, while indicative government fees covering licenses, registration, Chamber of Commerce and notarisation typically total SAR 2,000 to SAR 8,000 or more. Some market estimates put total first-time registration costs near SAR 30,000, with annual renewal fees reaching up to SAR 62,000 depending on the license class. Understanding these figures early helps investors plan realistic budgets before committing to a structure.

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