Saudi Arabia is the largest economy in the middle east. As we all know Kingdom’s economy has been more dependent on the oil sector for many years. But due to increasing rates of petroleum products and gases, the Saudi Government has planned to give a new face to the country’s economy. And that’s the essence of Vision 2030!
Vision 2030 aims towards diversifying the entire economy of Saudi Arabia like never before. It has made it possible to make Saudi a part of the list of countries providing the best business environment and opportunities. Saudi Government wants to open up its economy in front of the world by enticing more and more foreign investors who want to scale up their business worldwide.
This is why plenty of entrepreneurs find Kingdom a lucrative place to kick-start their business in 2022! When we talk about the potential business opportunities in KSA, how can we forget the restaurant business in Saudi Arabia! Yes, various food companies in Saudi Arabia are booming because of the emerging demand from the country’s vast population.
So, are you also looking forward to getting the ball rolling on your own food business in the Kingdom? Are you wondering how to apply for the license you will require for a Saudi food company? If yes, you are at the right place! This article will guide you on everything, including the food license of KSA, Saudi government formalities, etc.
So, without getting delayed, let’s get started.
Why Should You Open Restaurant Business in Saudi Arabia?
Due to its strategic location, the Kingdom of Saudi Arabia is one of the most suitable countries to set up a food business. If you plan to flourish your restaurant business in other countries of the Middle East in the coming time, you must consider KSA as a priority.
KSA has opened endless opportunities for foreign investors. Vision 2030 has truly opened the country to the world to attract lucrative foreign investment opportunities like never before.
If we check out the doing business index published by World Bank, Saudi Arabia ranks at 62nd position among 190 countries globally. Thus, Kingdom is ahead of other neighbouring countries, including Oman, Qatar, etc.
The most significant benefit the restaurant owners get is its tax structure. Unlike UAE, the Kingdom offers the highest tax concession to various businesses, which is one of the fascinating factors for foreign investment in Saudi Arabia.
Especially if we talk about food and beverage businesses, its market has been emerging like hell in KSA. So being part of such a flourishing industry is definitely going to be a lucrative business opportunity.
Let’s have a look at some statistics:
- The Kingdom’s food industry was $11.6 billion in 2019, expected to grow to $13.7 billion by 2025.
- In 2015, there were approximately 13000+ fast food outlets and 10000+ full-service restaurants or food businesses in Saudi Arabia.
The country provides the highest security to the expatriates and is also known for the lower crime rates than other countries in the entire world. Therefore, considering a Business Setup in KSA or Setting up a company in Saudi Arabia is one of your favorable decisions.
Government Bodies You Have to Deal With to get Food and Beverages License in Saudi Arabia
Requirements to deal with various Government bodies in KSA may differ based on how you want to set up and run your food business.
You can open and run a restaurant either as a foreign investor or through a local sponsor.
If you opt for the first option, i.e., of a foreign investor, you will have to deal with SAGIA (Saudi Arabian General Investment Authority). On the contrary, if you choose the local sponsor, you must deal with Commercial Registration.
As a restaurant owner in the Kingdom, you have to follow all the rules, regulations, and permissions issued by the Saudi Food and Drug Administration & the Ministry of Commerce.
Moreover, you will also have to fulfill various obligations set out by the municipality under which you have opened your food business.
Food and Beverage License in Saudi Arabia
To open and run a restaurant or food business in the Kingdom, you must first apply and acquire a valid restaurant license from the Government authority of KSA.
You will require certain documents to be submitted while applying for the food and Beverage License in KSA
Here, we have listed out those documents you will have to submit during the food license application:
- Address proof
- The ID of all shareholders and directors of your food company
- Trade name confirmation proof
- A bank transfer letter
- AOA (Articles of Association)
- MOA (Memorandum of Association)
- stakeholders and directors’ passport copy
Once you submit the documents mentioned above, Kingdom’s Government official will issue a valid license allowing you to open a food business in KSA.
Getting a food license in KSA is not enough as you will also require to meet some physical or location-based requirements for your restaurant.
Physical Requisites for Opening Restaurant or Food Companies in Saudi Arabia
Site & Venue Requirements
Your food business location must be on a commercial street or commercial center and not on a residential area or street.
Size of site/venue
Your restaurant business area in KSA should be at least 65m squared.
Your food business location must entail at least a 9m squared warehouse.
The washing area in your restaurant must be more than 9m squared and separate from the kitchen area.
The required kitchen area is at least 15m squared which must be adequately ventilated. If your restaurant is endowed with a dining area, both kitchen and dining areas must be apart.
The dining area at your restaurant must be greater than 30m squared, and it should be well furnished with adequate tables and chairs. Moreover, the height of the barriers that divide tables must not exceed 1.5m.
Your site must consist of at least one toilet and sink for every 10 people. The minimum area of the toilet is also fixed, i.e., 1.2m squared. The toilet should be compulsorily Arab, and if your restaurant has more than 1 toilet, it should be a flush toilet only. Moreover, the restaurant must facilitate women with separate toilets.
Your restaurant business location in Saudi Arabia must be 25m away from the gas selling shops and 30m away from the petrol stations.
- Washing Room & Toilets
Minimum 15 air changes per hour
- Cooking Room
Minimum 25 air changes per hour
Minimum 6 air changes per hour
Prohibition in Food and Beverage License of KSA
- It’s prohibited to offer jobs to workers who are not covered by the employer’s sponsorship.
- Some activities are restricted to Saudis, and you can’t employ workers for those activities.
- You can’t change your business site. Moreover, it’s not allowed to change the usage of your venue without getting permission from the respective municipality.
- You also have to place the food and Beverage license you get from the Saudi Government in a way that everyone can see it.
- Health & safety principles issued by the General Directorate of Civil Defence should be placed in a prominent place so that everyone can see them.
- The restaurant must provide a parking area according to the guidelines issued by your municipality.
So, why are you waiting now? Just drop us a message or call us; we will be more than happy to assist you!
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