The gaming industry may not be the first one that comes to mind when you think of Saudi Arabia. But as the Kingdom continues to drive diversification away from oil sectors, it is fast gaining traction.
So much so, that the video games and e-sports industry is expected to expand almost sevenfold over the next eight years. Of course, this makes it a great time to get involved. So, keep reading to discover:
- • An overview of the gaming industry in Saudi Arabia
- • Steps to start a gaming business in Saudi Arabia
- • Cost of starting a gaming business in Saudi Arabia
- • How to scale your gaming business in Saudi Arabia
- • Taxes in Saudi Arabia – Explained
- • How Creative Zone can help with business setup in Saudi Arabia
An overview of the gaming industry in Saudi Arabia
One of the key pillars of Saudi Arabia’s Vision 2030 to promote non-oil industries is investment in less traditional areas. That has seen a thoroughly modern sector, gaming, focus the attention of many investors in the region.
Most notably, the country’s Public Investment Fund (PIF) recently launched the Savvy Gaming Group to grow and develop the industry. The PIF also acquired a German e-sports firm and a British e-sports platform. At the same time, Crown Prince Mohammed bin Salman’s Misk Foundation also invested in SNK, a Japanese video game publisher.
The state’s backing of this once niche industry has seen it grow to a value of USD 1bn this year with estimates suggesting it could reach almost USD 7bn by 2030. This means the Kingdom accounts for the lion’s share of the region’s gaming and e-sports industry, with the next biggest markets in the UAE and Egypt reaching revenues of USD 692bn between them in 2021.
Steps to start a gaming business in Saudi Arabia
The first and most important step before beginning the process of starting a business in Saudi Arabia is to book a free consultation with a regional expert. The team at Creative Zone will take the time to understand your needs and thoroughly explain the process before guiding you through the following steps:
Step 1: Industry and business structure
The first task is to clearly outline the industry in which you wish to work. This may change depending on the exact nature of your gaming business. For example, you may wish to develop games, run gaming platforms or become a professional gamer which may require a different licence type.
Your chosen business activities will also have a bearing on whether it is best to set up in a free zone or in the mainland.
Step 2: Business premises
From next year, foreign owned businesses must have a regional headquarters in Saudi Arabia in order to obtain a trade licence.
So, if you are starting a new company, you will need to take on mainland premises or sign up to a licence package in a free zone. If you are setting up a branch office, you will need to lease a business premises or work with a local service agent.
Step 3: Investment licence
Foreigners starting a business in Saudi Arabia need an investment licence. This licence is issued by the Saudi Arabia General Investment Authority (SAGIA).
Once you have obtained your licence, you can buy or incorporate a new company or set up a foreign branch. At this stage, you will also need to apply to the Ministry of Commerce and Investment for a commercial registration certificate.
Step 4: Additional documentation
There are a few more documents required before you can start trading, and Creative Zone can help you get them.
But for us to liaise with all relevant bodies and get your Memorandum of Association, Issuance of Commercial Registration and more, you will need to provide the following documents and information.
- • Proof of ID and address for directors and shareholders
- • Passport copies for shareholders and directors
- • Copy of trade name confirmation
- • Bank reference letter
At this stage, you will also need to appoint a General Director to handle your business affairs.
Finally, you’ll need a visa to live, work, and reside in Saudi Arabia. Once again, Creative Zone can manage this entire process for you.
Cost of starting a gaming business in Saudi Arabia
The cost of starting a new business in Saudi Arabia is in the region of SAR 15,000 to SAR 30,000 (approximately the equivalent amount in AED).
However, this will depend on the nature of your business, the licence you require and whether you opt to set up in the mainland or a free economic zone.
For a full and personalised breakdown of the costs involved, get in touch with the team at Creative Zone.
How to scale your gaming business in Saudi Arabia
Here are three simple ways to help your gaming company gain traction in Saudi Arabia.
1. Get to know local customs
The first thing to do when launching a business in any new jurisdiction is to get to know local business practices and customs.
Even taking the time to familiarise yourself with local greetings can go a long way to endearing you and your business to potential investors, customers and business partners. So, brush up on Saudi etiquette and communication styles and you’ll soon reap the rewards.
2. Form strategic partnerships
One of the fastest and most effective ways to scale a gaming business is through strategic partnerships.
By partnering with a complementary business, you can get instant access to new potential customers as well as an opportunity to add extra value to your existing customer base.
3. Keep a close eye on the competition
Staying abreast of goings on at your competitors has several advantages. For one, you can spot gaps in their offering that your business can potentially fill.
You can also learn from what works and what doesn’t by looking at larger players in your industry. Keeping an eye on the competition also helps you to see your industry and the current offerings on the market through the eyes of your customers.
Taxes in Saudi Arabia – Explained
Aside from a growing and diversifying economy, another major draw to Saudi Arabia for foreign entrepreneurs is its attractive tax regime.
In short, there is no individual income tax levy in Saudi Arabia. That means any income derived from employment within the country is 100% from income tax.
However, generally speaking, non-Saudi investors are liable for corporation tax. When companies are jointly owned by Saudi citizens and non-citizens, only the non-Saudi owned portion of the business is subject to tax.
The corporate tax rate in Saudi Arabia stands at 20% of net adjusted profits. The exception to this is for profits derived from oil and hydrocarbon production which are subject to rates between 50% and 85%.
How Creative Zone can help with business setup in Saudi Arabia
Creative Zone offers you the best solutions to start your company in Saudi Arabia with minimal effort on your part. We’ll give you fast, reliable and unbiased advice on your unique business setup requirements before helping you choose the best licence for your needs.
We’re then on hand to guide you through the entire process from start to finish. That means we’ll handle the hassle of registering a company while you focus on getting your business ready to trade.
Creative Zone is your one-stop shop.
Our international staff are experts in tailoring company formation packages to all requirements. So, if you’re looking to start a gaming business in Saudi Arabia, Creative Zone will make your journey into business ownership quick, simple and hassle-free.