Mohammed’s story of setting up a limited liability company in Saudi Arabia

In a small apartment in Jeddah’s Al Rawda neighborhood, Mohammed sits at his desk, re-reading the commercial register that bears his name, not as an employee, not as a consultant, but as a founder, owner, and investor in Saudi Arabia’s future.

“This paper,” he says, clutching a copy of the record, “changed my life.”

A year ago, Mohammed was an engineer in Dubai, working on renewable energy projects, but he felt that geographical boundaries were starting to close in on him.
He was watching what was happening in Saudi Arabia with the eyes of an analyst, and then with the eyes of a dreamer.

• Vision 2030.
• Openness.
• Huge opportunities in clean energy.
• A future is being built not only in Europe, but also in the Middle East, but one question stood in front of him:
• Can a foreigner like me set up a company in Saudi Arabia?
• Will this incorporation be safe (legally and financially)?

First meeting: Can I start from afar?

One night, while Mohammed was browsing Google and searching for the topic of company formation in Saudi Arabia, he came across the name InvestGlobal

Consultants specializing in company formation, with a focus on supporting foreign investors.

Send an SMS:

I am Mohammed, an Egyptian engineer based in Dubai, I don’t have a network in Saudi Arabia, and I don’t understand the laws and regulations and how they work.”
Can I really set up a company in Saudi Arabia?”

The next day, the consultant from the InvestGlobal team called him.
He didn’t treat him as a client, but as a partner in a journey, saying, “Of course you can. Most importantly, you can start in Dubai, and we will be with you every step of the way.”

But Muhammad was afraid of one thing:

“If the company fails, will I be required to pay debts from my account in Egypt or Dubai? Will I lose my house in Cairo?”

The consultant replied calmly:

“No. Because you are not setting up a sole proprietorship. You are creating a limited liability company, which according to Article 3 of the Saudi Companies Law, is a separate legal entity, and your liability is limited to the share of capital you contribute.”

They were simple words, but enough to melt the mountain of fear Mohammed had built up in his mind.

What is this company (LLC) that protects the foreigner?

The InvestGlobal consultant began to explain to him, in simple language, that an LLC is not just an administrative designation, but a legal shield specifically designed to protect entrepreneurs.

The consultant told him: “Imagine your company owes a million riyals, but you, as a partner, have no claim beyond what you have invested…your personal assets from your home to your car to your overseas account are all protected.”

“Today, thanks to recent updates in the investment law, foreigners are allowed to retain up to 100% ownership in most activities, including your renewable energy activity, but only if you complete the procedures legally and obtain the necessary permits from the Ministry of Investment.”

Why Choose a Limited Liability Company?

Mohammed began to ask: Why don’t I start an individual project?
The consultant replied: “Because a sole proprietorship exposes you to full liability. An LLC is a separate entity, and it protects your personal assets – in Saudi Arabia, Egypt, Dubai, anywhere in the world.”

He explained to him the great benefits of this type of company:

• Suitable for small and medium-sized businesses, and allows for later expansion.
• Enhances your credibility with banks, customers, and partners.
• Separate your personal and company funds.
• Facilitates the attraction of investments through effective business partnerships.

“You’re not just building a company,” the consultant told him, “you’re building the future.”

The road from dream to reality step by step

Mohammed never imagined that setting up a business in Saudi Arabia could be done without setting foot in the country, but with Invest Global, it’s possible.

First: Choosing a name and activity.
According to the National Classification of Activities (NCA), EcoSmart is specialized in designing and installing smart solar energy systems.

II: Fulfillment of legal requirements:

• Must be 18 years of age or older (and was).
• Not be a government employee (working in the private sector).
• Submit a passport certified by the Egyptian Foreign Ministry and the Saudi Consulate.
• An authorized legal authorization that enables InvestGlobal to represent him.
• Proof of capital transfer to the company’s account.

The foundation contract. The document that determines the fate of the partnership

“I thought the contract was just a formality,” says Mohammed.
But Invest Global’s consultant explained to him that this document is the basis on which trust is built between the partners when drafting the LLC’s Articles of Association, including:

• The date and place of the contract.
• Partner data (names, identities, shares).
• Company name and headquarters.
• The purpose of the organization.
• Capital and each partner’s share.
• Profit and loss distribution mechanism.
• The duration and management of the company.
• Conditions for increasing or decreasing the capital.
• Liquidation and dissolution clauses.
• Signatures of all partners.

After forming a limited liability company in Saudi Arabia From paper to reality

InvestGlobal didn’t stop at setting up a company, we helped him complete the rest of the legal and administrative requirements:

• Tax registration through the Zakat, Tax and Customs Authority.
• Create an establishment file with the Ministry of Human Resources and Social Development.
• Register with the General Organization for Social Insurance.
• Register with the Jeddah Chamber of Commerce.
• Opening a business bank account (with a short visit to Jeddah).

“Every step was organized, planned,” he says. “I felt I had a support team that didn’t leave me alone.”

From Partnership to Leadership

The InvestGlobal team explained to him that the supreme authority in the company belongs to the General Assembly of the partners, which makes the fateful decisions from :

• Amendment of the Memorandum of Association.
• Increase or decrease the capital.
• Dividends.
• Company dissolution and liquidation.

The director is appointed directly in the memorandum of association or through a resolution of the partners, and is responsible for the day-to-day management and representing the company legally and before third parties.

“I chose an experienced Saudi partner to be the manager,” says Mohammed. “This gave the company more credibility and made it easier to deal with the authorities.”

“I’m involved in the big decisions, but he manages the operations, and that’s the flexibility the LLC gave me.”

Transparency and Accountability Financial Statements and Reports

The InvestGlobal consultant explained to him that the company’s director is obliged annually to prepare:

• Financial statements.
• Company activity report.
• Dividend suggestions.

These documents must be sent to partners 21 days prior to the Annual General Meeting.

“This ensures transparency,” says Mohamed. “I, as a foreign partner, feel part of the decision, even if I am geographically far away.”

The InvestGlobal consultant assured him that every partner:

• Voting rights (with a number equal to their shares).
• The right to inspect records twice a year.
• The right to authorize another partner to vote.
• An obligation to maintain the confidentiality of information.

We also advised him to include a clause in the contract regulating the settlement of disputes by arbitration, to ensure that disputes are resolved quickly and without disrupting the work.

Invest Global is your gateway to Saudi Arabia:

“Before Invest Global, I saw Saudi Arabia from afar, but after Invest Global, I live in it, work in it, and believe in its future… They didn’t just register me a company, they designed a roadmap for me, understood my fears, appreciated my ambition, and opened a door I thought was closed,” said Mohammed.

When Saudi Arabia opens the door… who dares enter?

Muhammad’s story is no exception.
It is a model of what the Kingdom offers today: A transparent investment environment, clear laws, and real opportunities for anyone with an idea and courage.

The limited liability company is no longer the exclusive domain of nationals, but has become the bridge on which foreigners from all over the world are crossing to set up their projects, contribute to construction, and protect themselves at the same time.

Muhammad arrived.
And who knows, you might be next.

Please stay tuned for our upcoming articles and contact us for more details.