Branch vs Subsidiary vs LLC in Saudi Arabia: Setup Guide

Foreign investors weighing how to enter the Saudi market face three common routes: a branch of a foreign company, a subsidiary, or a limited liability company (LLC). Each has its own process and costs, but all begin at the same point — registration with وزارة الاستثمار before any investment activity takes place.

Registration with وزارة الاستثمار currently carries no fee and is submitted through the ministry's electronic portal. Once registered, the investor can issue a Commercial Registration (CR) and obtain the sector licences required from the relevant authorities. Registration validity depends on the specific registration issued and the applicable activity requirements.

LLC and subsidiary options

A Saudi LLC with foreign ownership is incorporated through the Ministry of Commerce's electronic services after وزارة الاستثمار registration is complete. Standard fees are SAR 1,200 for the LLC Commercial Registration and SAR 500 for publication — SAR 1,700 before adding 15% VAT. The standard LLC establishment service is completed immediately, while an LLC set up under an investment licence lists the same fees but a duration of within 72 hours.

A "subsidiary" is not a separate legal form in Saudi Arabia. It is normally established as an LLC, a joint-stock company, a simplified joint-stock company, or another permitted form, owned by a Saudi or foreign parent. The fees and capital requirements depend on the chosen legal form and activity.

Branch of a foreign company

A branch is set up through the Ministry of Commerce service for establishing a company under an investment licence. The parent company's constitutional documents, financial statements, board resolution, and authorised representative details are generally required. The exact branch establishment fee is not stated in the current information, and investors should not assume the SAR 100 branch CR fee represents the total incorporation cost. As a reference, the ministry lists SAR 200 for a main CR and SAR 100 for a branch CR — issuance fees that do not necessarily cover publication, investment registration, municipal, sector-licence, Chamber, or VAT charges.

The core sequence is the same across all routes: register with وزارة الاستثمار, then complete incorporation and the CR with the Ministry of Commerce. Understanding the right structure early can save time and cost for businesses planning to operate in the Kingdom.

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