Industrial License in Saudi Arabia : Guide 2024
Investors seeking to capitalize on Saudi Arabia's robust industrial sector may capitalize on its strategic geographic location, robust infrastructure, and tax exemptions. Nevertheless, success necessitates the ability to navigate the regulatory framework. CIG’s professionals will provide a comprehensive guide to the process of obtaining an industrial license in Saudi Arabia in this blog. The industrial license procedure entails a number of steps and the services of a public relations officer. For further information, please continue reading.
The Regulations of Industrial License in Saudi Arabia
Before initiating industrial ventures in Saudi Arabia, investors are required to submit an application through the Ministry of Industry and Mineral Resources (MIMR) portal. A enterprise must be registered with MISA by foreign investors. Submitting a comprehensive business plan and demonstrating financial feasibility are involved in this process. Even though it may be advantageous to have a local collaborator, it is not mandatory for all sectors. The investor should specify the proposed location, the estimated capital, the product and production capacity. A license application form will be provided to the applicant if the ministry deems the initiative appropriate. One of the following two regulations permits the issuance of an industrial company license in Saudi Arabia:- Industrial projects established by Saudi citizens with full Saudi capital are subject to the National Industrial Development Program.
- Industrial projects wholly owned by foreign capital or in joint ventures with foreign capital are subject to the Foreign Investment Law.
Rules for Industrial License
The industry license system does not apply to projects with a fixed capital of less than (SAR 1 million). However, they are required to obtain commercial registration. Investors are advised to acquire registration forms from the Industrial Project Evaluation and Licensing Department of the Ministry. The form and the equipment invoice must be submitted by the investors to the Department of Commerce. The business registration office will be contacted upon approval. The investor is required to contact the registration department for the registration procedure, regardless of the project's location. It is possible to register bakeries, refrigerated storage facilities, ice plants, and cement mixing projects for commercial purposes without obtaining an industrial license from the Ministry.Tax Exemption in the Saudi Industrial Sector:
The industry license system does not apply to projects with a fixed capital of less than (SAR 1 million). However, they are required to obtain commercial registration. Investors are advised to acquire registration forms from the Industrial Project Evaluation and Licensing Department of the Ministry. The form and the equipment invoice must be submitted by the investors to the Department of Commerce. The business registration office will be contacted upon approval. The investor is required to contact the registration department for the registration procedure, regardless of the project's location. It is possible to register bakeries, refrigerated storage facilities, ice plants, and cement mixing projects for commercial purposes without obtaining an industrial license from the Ministry for the following:- Machinery.
- Equipment.
- Spare components.
- Semi processed Materials.
- Raw and packaging materials.
The following conditions must be met by industrial enterprises in order to obtain these benefits:
- Ensure that all necessary information and detailed information regarding the industrial project are provided to the Ministry, and representatives of the Ministry may inspect the project in accordance with the Act.
- Utilize only the equipment, machinery, spare parts, and raw materials that are exempt from tariffs in licensed factories in order to obtain the exemption.
- The staff must consist of Saudi labor and technical personnel, unless the Ministry of Labor and Social Affairs has approved any other personnel.
Industrial License Application Process
The application should include the applicant’s legal status, information about the company, and the products. It plans to produce in the Kingdom information about the local competition. Description of the manufacturing process, detailed information about equipment, machinery, and raw materials, manpower requirements, and plans for Saudi labor and personnel training, Project value, economic feasibility study, project cost, and marketing plan. The functions of the Foreign Investment Committee include recommending development projects, evaluating investment applications, investigating complaints or disputes, recommending penalties for violators, and formulating rules for bill implementation. SAGIA|MISA underscores the significance of foreign companies conducting business in accordance with the appropriate licensing requirements. The service offers industrial licenses for all sectors in Saudi Arabia, including heavy and light industries and transition industries.Documents for Industrial License Saudi Arabia
- Commercial registration document certified by the Saudi Embassy. The ID must be provided if one of the partners is a natural person with the nationality of one of the GCC countries.
- The financial statements of the parent company from the previous fiscal year.
- Assume that one of the partners suggested that the Ministry of Investment had granted prior authorization. It is necessary to specify the collaborator information when submitting the online application.
- Owners of luxury residences are exempt from these requirements.
- The applicant is required to provide information regarding their nationality, domicile, or premium residence in Saudi Arabia.
