Analysis of Commercial Registrations for 2018 by Regions and Legal Entities

In 2018, establishments as a legal entity dominated registration rates, accounting for approximately 91% of all registered legal entities in the Kingdom.

Limited liability companies ranked second with about 8%, highlighting a significant gap. This preference for starting a business through an establishment is likely due to the higher fees and costs associated with hiring a certified accountant for limited liability companies.

The Riyadh region achieved the highest percentage of registrations, representing about 26% of the total records, followed closely by the Makkah region at 24%. The Eastern Province came third with 15%, followed by Medina at 6%. Other regions such as Qassim, Asir, Jazan, Tabuk, Hail, Najran, and the Northern Borders trailed behind, with Al Baha and Al Jouf recording the lowest registration rates.

The Eastern Province ranked first in the registration of general partnerships and limited partnerships, with rates of 32% and 31%, respectively.

Riyadh recorded the highest percentage of registered limited liability companies, accounting for a remarkable 42%. Notably, Riyadh, Makkah, and the Eastern Province collectively represented around 85% of all limited liability company registrations, leaving only 15% distributed among the remaining ten regions. This disparity calls for attention from the Ministry of Commerce and the Small and Medium Enterprises Authority (Monsha’at) to stimulate commercial activity in other regions.

As for commercial establishments, Riyadh, Makkah, and the Eastern Province collectively accounted for 63% of the total registered establishments, while the remaining regions collectively achieved 37%.