Regional Headquarters License (RHQ) in Saudi Arabia
Benefits of Acquiring a RHQ
Prime Location: Saudi Arabia offers a strategic hub for expanding into the MENA region, providing access to key markets
Economic Strength: As a leading economy, Saudi Arabia provides a stable business environment conducive to growth and investment
Gateway to MENA: With its central location and strong infrastructure, Saudi Arabia serves as an ideal entry point for expanding businesses across the MENA region
Government Support: The Saudi government offers incentives and streamlined processes for companies establishing Regional Headquarters, facilitating business operations
Advantages of Regional Headquarters
Access to Saudi Market
With over 36 million people, Saudi Arabia provides access to one of the largest economies in the MENA region.
Geographical Advantage
Positioned as a gateway to the GCC and wider MENA markets, Saudi Arabia offers unmatched expansion opportunities for startups and multinational corporations.
Business-Friendly Policies
Ongoing economic and legal reforms, including Vision 2030 initiatives, enhance Saudi Arabia’s business environment, fostering growth and innovation.
Tax Incentives
Regional Headquarters status may qualify for significant tax benefits, including VAT exemptions on imports.
Access to State-Sponsored Projects
Participation in government infrastructure ventures offers growth, partnership, and innovation opportunities within Saudi Arabia.
Special Economic Zones
The government offers additional advantages and incentives for companies operating as Regional Headquarters in designated special economic zones.
Bilateral Trade Accords
Trade agreements with major countries reduce tariffs and open up markets for goods and services.
Infrastructure Advancements
Substantial investments in infrastructure development create opportunities for businesses, especially in engineering and construction industries.
Securing a RHQ License in Saudi Arabia
Securing an RHQ license in Saudi Arabia can be a time-consuming process, taking several months. The requirements and steps involved differ based on the business’s nature and individual circumstances.
Requirements for Securing a Regional Headquarters in Saudi Arabia
Securing a Regional Headquarters License in Saudi Arabia involves setting up a subsidiary of an international company under Saudi regulations. This allows global firms to create their regional hub in Saudi Arabia and manage their satellite offices across the MENA region.
Required Documents
- Submit a commercial registration or license authenticated by the Saudi consulate from your home country.
- Provide certified copies of commercial registrations or licenses from two different countries, excluding Saudi Arabia and the headquarters country of the Multinational Group, verified by the Saudi Embassy in those countries.
- Furnish the audited consolidated financial statements from the applicant’s previous financial year, attested by the Saudi Embassy in the relevant country.
Rules and Restrictions
- Global companies must have operational bases in at least two regions besides their main headquarters and Saudi Arabia, either through subsidiaries or branches.
- A Regional Headquarters (RHQ) in Saudi Arabia functions as a separate legal entity, operating independently or as a branch of an international company.
- The RHQ license holder should focus solely on activities related to RHQ operations and avoid engaging in revenue-generating commercial activities beyond this scope.
- Core operations of an RHQ must begin within six months of obtaining the license.
- Within a year of acquiring the RHQ License, the RHQ must initiate a minimum of three discretionary RHQ-related activities.
- Employees handling essential RHQ tasks must possess expertise gained at the main headquarters or another regional hub of the Multinational Group. At least three of these employees should hold executive positions.
- Within the first year after obtaining the RHQ License, the RHQ must employ a minimum of 15 full-time employees engaged in RHQ activities, including senior-level executives specified in point
- The Ministry of Investment may revoke the RHQ License if:
– Essential or discretionary RHQ activities fail to commence, or the minimum required personnel are not employed within the specified periods.
– Core RHQ functions cease or at least three discretionary activities are discontinued.
– Any conditions of the RHQ License, by either the RHQ or the Multinational Group, are not adhered to.
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