Transport License
in Saudi Arabia
Transportation Sector Growth
Comprehensive Network: Saudi Arabia’s diverse transportation system is key for logistics and supply chains
Smart and Sustainable: Focus on intelligent solutions and sustainability drives industry growth
Logistics Hub: GACA is developing a logistics zone near Riyadh Airport to boost Saudi Arabia’s status
Private Sector Role: Government promotes private sector involvement through Public-Private Partnerships
Transportation Landscape of Saudi Arabia
Regulatory Bodies: Overseen by GACA, SPA, and the Public Transport Authority
The government will invest over SR500 billion ($133.3 billion) in ports, airports, railways, and infrastructure by 2030
The logistics industry is projected to grow at a 6.7% CAGR from 2020 to 2025
By 2030, transport and logistics will contribute 10% to Saudi Arabia’s GDP
Saudi Arabia’s cargo network, with 40,000 trucks, serves eight Middle Eastern and Central Asian countries
Saudi Arabia leads the GCC in logistics, with many transport and infrastructure projects
Significance of the Transport Industry
Economic Growth
The transport industry boosts Saudi Arabia’s economic development by providing reliable transit solutions, connecting businesses with consumers, and facilitating trade activities.
Strategic Location
Positioned at key trade junctions, Saudi Arabia acts as a gateway to regional markets, reinforcing its role as a vital transportation and logistics hub.
Government Support
The Saudi government recognizes the importance of the transport sector, investing heavily in modernizing infrastructure such as roads, airports, seaports, and railways.
Tourism Support
Transportation is essential for supporting the tourism sector, ensuring visitors have efficient means to explore the nation’s attractions and landmarks.
Guidelines for Transportation Licenses
International companies seeking to provide public land transportation services in Saudi Arabia can obtain this license. The license covers various public transport service opportunities, including:
1. License for city bus transportation services.
2. License for city metro transportation services.
3. License for other forms of land transportation.
1.City Bus Transit License
Authorizes international corporations to operate public bus services within cities in Saudi Arabia.
Required Documents
- Board Resolution: A document from the company’s board of directors, affirming the decision to invest in Saudi Arabia. It should include shareholder details, allocated capital, business nature, location, and appointment of a General Manager, verified by the Saudi Embassy.
- Commercial Registry Copy: An authenticated copy of the company’s commercial registry from its home country, endorsed by the Saudi Embassy.
- Contractual Completion Records: Evidence demonstrating adherence to contractual completion schedules for the past five years.
- Financial Documentation: Documents proving financial capability aligned with project capital requirements, shareholder contributions, adherence to project execution plans, and compliance with fiscal regulations for the specific business activity.
Rules and Restrictions
- Saudi Shareholder Proportion: Saudi shareholders’ proportion and capital should align with financial limitations set for the specific activity.
- Financial Criteria: The foreign company must have an average revenue of at least 3 billion Saudi riyals and assets not less than 1.5 billion Saudi riyals over the three years preceding the licensing. Additionally, the company should have licenses in at least two countries and employ a minimum of 10,000 individuals.
- Capital Prerequisites: Capital requirements for bus acquisition, operations, and maintenance should meet the Ministry of Investment’s benchmarks for service-oriented enterprises (500,000 SAR).
- License Documentation: Certified copies of Transportation/Public Transportation Authority’s licenses for bus transit endeavors are required for Saudi shareholders.
- Workforce Quotas: Adherence to national workforce quotas established by the Ministry of Labor and Social Development is mandatory for transport services.
- Clean Record: The establishment applying for the license should not have a history of prior license cancellations within the past ten years, either within or outside Saudi Arabia. Additionally, no traffic safety-related fines or penalties should have been incurred domestically or internationally during the same period.
- Emergency Transit Authorization: Authorization from relevant Saudi authorities is necessary to utilize public transit during emergencies, conflicts, and wartime situations.
- Technical Standards: Technical attributes and manufacturing methods must comply with Saudi, Gulf, or international standards.
- Safety Blueprints: Annual blueprints focused on enhancing safety measures must be submitted to the Public Transport Ministry for evaluation.
- Application Details: During the electronic application process, the applicant should provide details such as Saudi national ID, premium residence, general residence, or commercial registration particulars of any involved Saudi corporations.
2. City Metro Transport License
Allows global companies to provide metro-based public transportation services within cities across Saudi Arabia.
Required Documents
- A declaration from the Company’s Board of Directors detailing their intention to invest in the Kingdom, listing the names of shareholders, allocated capital, division of shares, nature of operation, site specifics, and the nomination of a General Manager with outlined responsibilities. This must be validated by the Saudi Embassy.
- An attested copy of the company’s original commercial registry from its country of origin, with authentication from the Saudi Embassy.
- Proof highlighting a consistent record of meeting contract completion schedules over the past five years.
- Documentation showing financial capability in line with project capital necessities, shareholder inputs, congruence with the project’s developmental strategy, and compliance with the fiscal guidelines specified for the activity in question.
Rules and Restrictions
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Saudi Shareholder Proportion: Saudi shareholders must invest capital according to the financial guidelines set for the specific activity.
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Financial Criteria: The foreign company should have an average revenue of at least 3 billion Saudi riyals and assets totaling a minimum of 1.5 billion Saudi riyals over the three years prior to the license application.
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International Presence: The company must hold valid licenses from at least two countries and have a workforce of at least 15,000 employees.
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Capital Requirements: Capital for bus procurement, operation, and maintenance must meet the Ministry of Investment’s standards for service sector entities, set at 500,000 SAR.
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Workforce Nationalization: Adherence to national workforce percentages set by the Ministry of Labor and Social Development is mandatory.
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Clean Licensing Record: The company must have a clean licensing record without any cancellations within the past decade, both domestically and internationally.
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Traffic Safety Record: No traffic safety fines or penalties should have been incurred domestically or internationally in the ten years preceding the license application.
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Emergency Authorization: Approval from relevant Saudi institutions is required for public transportation use during emergencies, conflicts, or wartime.
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Technical Standards: Technical attributes and manufacturing standards must meet Saudi, Gulf, or international norms.
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Safety Proposals: Annual safety enhancement proposals must be submitted to the Public Transport Ministry for evaluation.
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Application Details: The applicant should include details such as Saudi national ID, premium residence status, general residency, or commercial registration of any collaborating Saudi establishments in their electronic request.
3. Other Transport License
This license is intended for wholly-owned international firms seeking to provide various public land transportation services within Saudi Arabia, including:
- Taxi services (public and private)
- School, tourism, airport, and materials transfer
- Transportation of pilgrims and visitors within and outside the Kingdom
- Bus transportation outside the Kingdom
- Taxi dispatch services
- Car rental, truck rental, bus rental, car hire brokerage, and freight brokerage
Required Documents
- A copy of the commercial registration of the shareholding partner, certified by the Saudi Embassy, and a copy of the national ID of any GCC national partners (if not already registered in ABSHAR system).
- The last three years of financial statements for the applicant company, certified by the Saudi Embassy.
- A business plan outlining the proposed locations and branches of the company, as per the results of an economic feasibility study.
Rules and Restrictions
- Proof of operations in at least three international markets for the same intended activity.
- A track record of providing the same activity for over 10 years in the company’s home country, with the establishment being recognized as a provider of high-quality road transport services based on evaluation by the Public Transport Authority.
- Capital of not less than 10 million Saudi Riyals as per the minimum requirements specified for the type of activity.
- Obligation to adhere to all the organized commitments of the activity, including the Saudization standards and percentages set by the Ministry of Human Resources and Social Development and implementing a mechanism to ensure compliance.
- Companies that provide services through technical channels are exempt from these requirements.
- If the enterprise engages in leasing vehicles (such as cars, trucks, buses, car rental brokers, and freight brokers) without drivers, it is exempt from adhering to the above requirements.
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