Process to Open a Company Branch Office in Saudi Arabia

However, there are cases when opening a branch office would be the best or most viable solution. So let’s see some advantages and disadvantages of both the types of branches.

A Permanent Branch is a branch which is an extension of the parent company’s office. The minimum start-up capital is approximately SAR 500,000, which is needed to usually satisfy SAGIA’s initial requirements.

A TSSO is considered when there is a registered commercial agency distribution agreement done between two parties – a foreign manufacturing company and a registered distributor who is a Saudi national and is dealing in the local markets.

A TSSO:

• It is only used in case of complex products
• Assists the registered distributor in KSA with tasks such as marketing and customer relations
• Should not sell products or get into revenue-generating activities
• Does not need any capitalization
• Requires that the current distribution agreement is registered with the Commercial Agencies Department of the Ministry of Commerce and Industry.

Temporary Commercial Registration (TCR)

To open or incorporate a branch office in Saudi Arabia, one needs to follow all the regulations and guidelines set by the Foreign Investment Law. A foreign investor who is applying for registering a branch office in Saudi could get the permission to do the same only for some specific activities, as the branch office is barred for some operations, like trading activities. Investors interested in opening a branch office in Saudi should be aware that the branch office is also known as a permanent branch, and the business entity can be established without a local or Saudi partner. Our expert consultants into this domain of company registration in Saudi Arabia can help and advice you on the documentation required in this case.