{"id":145815,"date":"2026-06-13T06:00:38","date_gmt":"2026-06-13T03:00:38","guid":{"rendered":"https:\/\/www.salamahlaw.com\/?p=145815"},"modified":"2026-06-13T06:00:38","modified_gmt":"2026-06-13T03:00:38","slug":"requirements-for-establishing-a-saudi-joint-stock-company","status":"publish","type":"post","link":"https:\/\/www.salamahlaw.com\/en\/requirements-for-establishing-a-saudi-joint-stock-company\/","title":{"rendered":"Requirements for Establishing a Saudi Joint-Stock Company"},"content":{"rendered":"

A joint-stock company is one of the most commonly established corporate forms in Saudi Arabia. To establish a Saudi joint-stock company, the requirements set forth under the New Companies Law (1443H) must be satisfied. In this article, Al-Salamah Law Firm and Legal Consultations outlines the requirements for establishing a joint-stock company in Saudi Arabia.<\/span><\/p>\n

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Definition of a Public Joint-Stock Company<\/span><\/h2>\n

Article (58) of the Companies Law (1443H) defines a joint-stock company as follows:<\/span><\/p>\n

A company established by one or more persons, whether natural or legal, whose capital is divided into tradable shares. The company alone is liable for its debts and obligations arising from its activities, and the liability of each shareholder is limited to the value of the shares subscribed by him.<\/span><\/i><\/p>\n

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Requirements for Establishing a Joint-Stock Company in Saudi Arabia<\/span><\/h2>\n

The New Companies Law (1443H) stipulates a set of requirements that must be met to establish a joint-stock company in Saudi Arabia, as follows:<\/span><\/p>\n

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  • The issued capital of a joint-stock company must not be less than SAR 500,000, and the paid-up capital upon incorporation must not be less than one quarter (25%) thereof. Accordingly, full payment of the capital is not required at incorporation; at least 25% must be deposited, while the remaining amount constitutes a debt owed by shareholders to be paid at a later date.<\/span><\/li>\n
  • The company shall have an issued capital representing the subscribed shares, and the articles of association may specify an authorized capital.<\/span><\/li>\n
  • Issued Capital: the actual capital for which shares have been offered and subscribed (the amount shareholders have committed to pay).<\/span><\/li>\n
  • Authorized Capital: an upper limit determined in the articles of association, allowing the company to increase its capital up to that limit in the future without the need for complex procedures (such as convening an extraordinary general assembly).<\/span><\/li>\n<\/ul>\n

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    Articles of Association<\/span><\/h2>\n

    The company\u2019s articles of association must be prepared and shall, in particular, include the following information:<\/span><\/p>\n