Branch vs Subsidiary vs LLC: Saudi Setup Costs

Foreign companies eyeing the Saudi market face an early decision: whether to enter as a branch, a subsidiary, or a limited liability company (LLC). Each option carries different legal exposure and set-up costs, and the right choice depends on how the business plans to operate in the Kingdom.

A branch is a legal extension of the foreign parent company. It has no separate share capital, and the parent remains fully liable for its Saudi operations. A subsidiary LLC, by contrast, is a separate Saudi company owned by the foreign parent, with its own share capital and limited liability for its obligations. When majority foreign-owned, both structures typically require a foreign investment license from وزارة الاستثمار.

What the government fees look like

For a Saudi-registered LLC or subsidiary, commercial registration for establishment costs SAR 1,200, with a publication fee of SAR 500 plus 15% VAT. Official base fees start from around SAR 1,775 and can reach SAR 2,100 depending on the service. Broader formation costs — including trade-name reservation, Chamber of Commerce membership and notarisation — typically total between SAR 3,000 and SAR 10,000, while full set-up including MISA licensing, attestation and office costs often runs from SAR 20,000 to SAR 85,000 or more. GOSI and ZATCA registration are currently free.

Opening a branch of a foreign company carries a listed service fee of SAR 1,600, with certain procedures citing SAR 600 for a limited liability structure and SAR 400 for partnerships. A typical branch CR issuance is about SAR 1,200 one-time, plus roughly SAR 1,000 for publication and SAR 3,000–7,000 for attestation and certified translation.

Branches also carry recurring costs: a MISA license fee of SAR 2,000 plus an investor-relations support fee of SAR 10,000 in the first year and about SAR 60,000 annually from year two, alongside an annual Chamber of Commerce subscription.

For investors and business owners in الرياض and جدة, understanding these differences early can shape both liability and long-term running costs — making the entry structure one of the first big decisions of doing business in the Kingdom.

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