The New Investment Law (2025): what actually changed
Saudi Arabia swapped its foreign-investment licence for a registration system in February 2025. Here is what genuinely moved for foreign investors — and, just as important, what did not.
A new front door — not a new building
For twenty-five years, entering Saudi Arabia as a foreigner meant obtaining a foreign-investment licence — first from SAGIA, later from the Ministry of Investment (MISA). The 2025 Investment Law changes both the vocabulary and the mechanics of that first step. What it does not change is that there is a first step.
Reading the reform correctly — what moved, what didn't — is the difference between a realistic entry plan and one shaped by the press release.
Licence becomes registration
Permission-based
- Apply for a foreign-investment licence as a precondition to incorporating
- Approval assessed case by case
- Longer, less predictable entry
- Foreign investors treated as a distinct, licensed category
Registration-based
- Register in the National Register of Investors and receive a registration certificate
- Broadly permitted, subject to a defined excluded list
- Shorter, more transparent MISA review
- Equal treatment of foreign and domestic investors
Registration is not a trading licence. It lets you incorporate — it is not, by itself, authority to operate. You still need a Commercial Registration, a national address, tax and social-insurance registration, and any sector approvals before you can trade.
One regime, repositioned around Vision 2030
The new Investment Law was issued by Royal Decree M/19 and came into force on 12 February 2025, replacing the Foreign Investment Law of 2000. It consolidates the regime, repositions MISA as the central gateway for foreign capital, and reframes the Kingdom as broadly open to investment rather than closed by default.
| Aspect | Before (2000 law) | After (2025 law) |
|---|---|---|
| Entry mechanism | Foreign-investment licence | Investment registration |
| Default posture | Permission required | Broadly permitted, with an excluded list |
| Investor treatment | Separate foreign regime | Equal treatment with domestic investors |
| Protections | Limited, dispersed | Expropriation protection, free fund transfer, arbitration |
| First step | MISA licence | MISA registration |
Real gains for foreign investors
Equal treatment
Foreign and domestic investors are placed on the same footing in law, rather than in a separate licensed category.
Guaranteed protections
Fair treatment, protection against expropriation, and the free transfer and repatriation of funds are written into the regime.
Dispute resolution
Investors may use arbitration and other alternative methods to resolve disputes.
Faster, clearer entry
Registration has shortened and simplified MISA's review, with dedicated investor service channels.
The obligations behind the front door
MISA is still first
You register with MISA before a Commercial Registration, a bank account or a single visa. Registration is the gate, not the destination.
The negative list remains
Some activities stay excluded from foreign investment; others need minimum Saudi participation or an exceptional approval.
Capital rules still bite
Activity-based capital expectations remain — most visibly the SAR 30 million bar for 100% foreign-owned trading.
Substance & compliance
Saudization, ZATCA registration, annual renewals and real substance all still apply, exactly as before.
Your company form is still governed by the 2023 Companies Law — LLC, Simplified Joint Stock Company, branch and the rest. The Investment Law changed how you enter, not the vehicle you build.
Lower friction at the door, same work behind it
Don't over-read the reform. It lowers friction at the front door; it does not remove the obligations behind it. Sequence and substance still decide whether a Saudi setup runs smoothly or stalls.
The investors who benefit most treat registration as step one of a longer, deliberately designed sequence — activity selection, the right vehicle, capital set with the bank file in mind, then the registration-to-operational chain — not as the finish line.
Questions we get asked first
Do I still need a MISA licence?
Since 12 February 2025 the licence was replaced by Investment Registration with MISA. You still register with MISA before you can incorporate — it is the first gate — but the process is a registration rather than a licence application.
Does the new law mean 100% ownership everywhere?
No. 100% foreign ownership is available across most sectors, but a negative list of excluded activities remains, some sectors require minimum Saudi participation, and trading carries a high capital bar.
Is registration enough to start trading?
No. Registration lets you incorporate. You still need a Commercial Registration, a national address, ZATCA and GOSI registration, and any sector approvals before you can operate.
What law governs my company form?
The 2023 Companies Law — which sets out the LLC, the Simplified Joint Stock Company, the branch and other vehicles. The Investment Law governs entry, not the corporate form.
When did the new Investment Law take effect?
It came into force on 12 February 2025, under Royal Decree M/19, replacing the Foreign Investment Law of 2000.
A better door into the same demanding market
The 2025 reform makes Saudi Arabia easier to enter and more predictable to plan for — a genuine improvement. But the Kingdom still expects real structure, real substance and real compliance from the businesses it lets in. Treat registration as the beginning of the work, and the reform works in your favour.
Planning your Saudi entry?
We confirm how your activity is treated under the new law and map the full sequence — registration to operational — before you file.
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This article is general information, current as of 2026, and is not legal or tax advice for any specific situation. Confirm current rules and the excluded-activities list with MISA before acting.