Saudi Regional Headquarters Program (RHQ)
The Saudi program for attracting Regional Headquarters of global companies was launched in 2021 and will be spearheaded by the Ministry of Investment and the Royal Commission for Riyadh City.
As part of Saudi Arabia’s Vision 2030 economic reform program, the Kingdom is actively encouraging global companies to set up regional headquarters within the country to promote foreign investment in Saudi Arabia. The details are given in the succeeding paragraphs.
The Saudi Arabia RHQ program focuses on diversifying Arabia’s economy from its dependence on oil, creating new economic opportunities, and positioning the Kingdom as a leading business and investment hub.
The RHQ program aims to attract around 480 MNCs to move their headquarters to Saudi by 2030. Saudi Arabia is aggressively pursuing global companies to set up regional offices in the country, and it is working.
Over 600 foreign companies, including giants like Amazon, Google, and Microsoft, have already set up regional headquarters in Saudi Arabia.
Through the RHQ program in Saudi, one can be eligible to obtain government contracts.
How does Saudi Arabia’s RHQ program benefit global companies?
Companies establishing their RHQs in Saudi Arabia will boost employment opportunities, facilitate knowledge transfer, and foster economic growth. Apart from the chance of getting government contracts, they will have the following benefits:
- The companies setting up regional headquarters in Saudi Arabia can gain proximity to key markets, strengthen partnerships with local businesses, and enhance operational efficiency in the Middle East.
- The company will be exempted from Saudization requirements for 10 years.
- The company will not limit the number of work visas for RHQ employees.
- The company will not have to pay MISA subscription fees for the following year.
- The company will access MISA’s “end-to-end” services at lower rates and with preferential treatment.
- The dependents of RHQ employees can work and apply for jobs in the country via the Ajeer program.
- RHQ professionals accredited adequately in their home of origin will be exempted from Saudi’s professional accreditation requirements.
- RHQ implements streamlined processes for licensing and permits.
- A growing pool of skilled professionals and initiatives to hire local talent.
- In coordination with the Ministry of Finance and the Zakat, Tax and Customs Authority, MISA recently announced a 30-year tax exemption package for companies moving their RHQs to the country.
- The package includes a zero percent corporate tax rate for 30 years. There will also be a zero percent withholding tax on payments made by the company to non-residents (e.g., cash dividends).
- These tax incentives are subject to renewal after the said period.
Why does the RHQ program make Saudi Arabia a hotspot for business expansion?
Saudi Arabia’s Regional Headquarters Program (RHQ) incentivizes multinational corporations (MNCs) to establish their regional headquarters there for several reasons:
- Proven Market Confidence: Saudi Arabia’s strategic location increases market confidence with easy access to key MENA regions and beyond markets.
- Global firms setting up RHQs reduce perceived risk for others.
- Access to Government Projects: RHQs are mandatory as they provide exclusive rights to compete for government contracts from 2024. Businesses are, therefore, forced to follow suit to obtain government contracts.
- The Business ecosystem of Saudi Arabia is growing, especially in the start-up sector with government initiatives.
- Clustered RHQs enable B2B synergy, talent flow and service integration.
- Fading First-Mover Advantage
- Early Incentives are limited and are rushing in before benefits shrink.
Vision 2030 of Saudi Arabia
The Kingdom has liberalized its rules and regulations to encourage global companies to set up regional headquarters within the country towards a digital and technology-driven future. The RHQ programme aligns with Saudi Vision 2030, which aims at economic diversification.
Heavy government investment is transforming Riyadh into a top global hub for business.
How can the Helpline Group in Saudi Arabia help?
Helpline Group, backed by a strong team, brings over 25 years of expertise in company formation, offering a seamless, hassle-free experience for clients, including foreigners.
Our professionals have in-depth knowledge of the recent rules and regulations, helping global companies set up regional headquarters in KSA and ensuring efficiency. With a worldwide presence and a tailored approach, we ensure that your business setup is handled with precision and professionalism, making us your reliable ally in achieving success.
