Saudi Arabia continues to refine its regulation to enhance compliance and streamline business operations for foreign entities. The recent update to Saudi regulations impacts companies in the process of appointing a General Manager (GM) and obtaining final work visa approvals.
Key Update
Government authorities have introduced new restrictions affecting GM appointments for certain nationalities. Saudi Arabia GM appointment restrictions include:
- Turkey
- Lebanon
- Yemen
Under the updated requirements, companies seeking to appoint a GM from the above nationalities (If not already an Iqama holder) must meet a capital threshold of more than SAR 200,000, to be reflected in the company’s official registration records.
What This Means for Businesses in Saudi Arabia
Companies that do not meet the capital requirement may face rejection at the final approval stage with the Ministry of Human Resources and Social Development (HRSD), even after receiving initial approval from MISA.
To comply with the new regulations, businesses may need to proceed with:
- MISA License Amendment (no associated government fees) -If issued-
- Articles of Association (AOA) and Commercial Registration (CR) Amendment (cost approx. SAR 1,825) -If issued-
Additionally, the capital increase must be formally injected into the company’s bank account, with proper documentation issued as proof. This capital can then be utilized for operational expenses.
Practical Options for Companies
To mitigate delays and ensure continuity, companies may consider:
- Appointing an interim GM from Sovereign PPG to facilitate access to government portals and maintain regulatory compliance; or
- Appointing a GM of a different nationality not impacted by the new restrictions and continue company operations.
Our Recommendation
Given the evolving regulatory environment, we recommend that companies review their current structures and planned appointments to ensure alignment with the latest visa issuance requirements. Meeting regulatory requirements early can help avoid delays in visa processing and operational disruptions.
For tailored guidance and support with amendments, general manager appointments, finalizing employment contracts, updating company’s commercial registration or business licenses and other compliance requirements, our team remains available to assist.
