Branch vs Subsidiary vs LLC in Saudi Arabia: 2025 Guide

Foreign companies and entrepreneurs looking to enter the Saudi market face an early decision: register as a branch, set up a subsidiary, or form a limited liability company (LLC). Each route carries different rules on legal status, liability, capital, and taxation.

A branch is an extension of a foreign parent company. It has no separate legal personality and is taxed as a non-resident permanent establishment. A subsidiary is usually a Saudi LLC with foreign ownership, standing as a separate legal entity under the Saudi Companies Law. The LLC itself is the standard corporate form for both local and foreign-owned firms, offering liability limited to the invested capital and flexible shareholding.

Where you register

The setup process runs across several government platforms. The investment licence for foreign entities is issued through the وزارة الاستثمار online portal. Commercial Registration (CR), company contracts, and articles are handled by the Ministry of Commerce via ناجز. Employer and labour files go through قوى and the GOSI employer file, while the municipality licence is issued on the Balady platform. A tax number comes from ZATCA, and unified login is done through نفاذ.

Fees and capital

For an LLC in 2025–2026, CR issuance carries a government fee of 1,200 ريال سعودي, with the same amount for annual data confirmation. Updating CR data costs 100 ريال سعودي, and incorporation publication is 500 ريال سعودي plus 15% VAT. Trade name reservation is 200 ريال سعودي in Arabic, up to 500 ريال سعودي for foreign-language names. A typical bundled invoice covering CR, first-year Chamber membership, and municipality licence runs roughly 1,825–2,100 ريال سعودي.

The Companies Law now sets no statutory minimum capital for an LLC. In practice, foreign-owned service-sector firms often need 100,000–500,000 ريال سعودي, while 100% foreign-owned wholesale and retail trade faces far higher requirements, around 30 million ريال سعودي. For foreign-owned LLCs, the historic annual MISA investment licence fee of about 12,000 ريال سعودي is currently waived, though it may be reintroduced.

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