Industrial Licence Saudi Arabia (2026): MODON Guide
To set up a factory in Saudi Arabia, a foreign manufacturer needs two licences: a MISA investment licence from the Ministry of Investment and an industrial licence from the Ministry of Industry & Mineral Resources (MIM). Most manufacturing activities allow 100% foreign ownership, light-industry projects start from a minimum capital of about SAR 500,000, and licensing is generally completed within 3 to 15 business days once documents are complete. Investors in MODON industrial cities also gain customs exemptions on machinery and SIDF financing of up to 75% of project cost.
This guide walks through the MISA industrial licence, the MIM industrial licence, MODON industrial cities and land, the requirements and documents, the incentives (customs exemptions, subsidised land and utilities, soft loans), the National Industrial Strategy, the step-by-step process and the indicative 2026 costs. For the wider setup journey, see our company formation in Saudi Arabia guide and our MISA licence guide.
What is an industrial licence in Saudi Arabia?
An industrial licence is the permit that authorises a business to operate a manufacturing or production facility in the Kingdom. For a foreign investor, two approvals work together rather than one. First, the Ministry of Investment of Saudi Arabia (MISA) issues an investment licence in the industrial category that grants the foreign entity the legal right to own and run an industrial business — in most activities with full foreign ownership and no Saudi partner. Second, the Ministry of Industry & Mineral Resources (MIM) issues the actual industrial licence and records the factory in the national industrial register, which is the official roll of licensed manufacturers in Saudi Arabia.
In practice you secure the MISA industrial licence first, complete your Commercial Registration with the Ministry of Commerce through the Saudi Business Center, and then obtain the MIM industrial licence for the factory itself. The MIM licence is issued in two forms. A preliminary licence covers project planning, land allocation and construction, and signals to MODON, the banks and your suppliers that the project is approved in principle. A final licence is granted once the factory is built, machinery is installed and the plant is ready for active production. Validity typically runs from one to five years, with renewals subject to ongoing compliance.
Understanding this two-track structure early prevents the most common planning error: budgeting and scheduling for only the MISA licence, then discovering that the MIM licence, land allocation and sector approvals add weeks and steps that should have been run in parallel.
Types of industrial licence
The MIM classifies industrial activity by scale and the nature of the manufacturing process. The three broad categories a foreign manufacturer will encounter are:
- Light industry licence — small and medium-scale manufacturing such as food packaging, light assembly, garments, furniture, plastics and consumer goods. These projects carry the lowest capital thresholds and the simplest approval path.
- Heavy industry licence — capital-intensive, large-scale operations such as metals, petrochemicals, cement and building materials, automotive components and heavy equipment. These attract higher capital requirements and more detailed environmental and safety review.
- Transformative industry licence — activities that convert raw materials into finished or semi-finished products, a category the Kingdom actively encourages to add value to local resources rather than exporting them raw.
On the MISA side, the relevant category is the industrial investment licence. Your specific manufacturing activity determines the licence sub-type, any sector-specific approvals, and the minimum capital that applies. Getting the classification right at the outset matters because changing it later usually means an amendment to both the MISA licence and the CR — a slow and avoidable detour.
MODON industrial cities and land
The Saudi Authority for Industrial Cities and Technology Zones (MODON) develops and manages more than 35 industrial cities across every region of the Kingdom, from Riyadh, Jeddah and Dammam to emerging cities near ports and mineral resources. Setting up inside a MODON city is the most common route for manufacturers because it bundles serviced land, ready infrastructure, utilities and a one-stop licensing experience alongside MISA and MIM. Instead of negotiating power, water and road access independently, you take a plot in a zone where that backbone already exists.
MODON allocates industrial land on long-term leases at rates that are highly competitive with commercial real estate, which is one of the strongest pull factors for industrial investors. To encourage investors to reach commercial production quickly rather than holding idle land, MODON applies a monthly land allocation fee during the build-out period — up to roughly 24 months — which stops once production begins. There is also an incentive structure that rewards facilities meeting environmental and safety standards over a full year of operation.
Choosing the right MODON city is a strategic decision that affects logistics costs for the life of the factory. A plant that imports raw materials and exports finished goods should weigh proximity to ports such as Jeddah or Dammam; a plant serving the domestic market may prioritise being close to its customer base; and a resource-processing facility should be near the mineral or feedstock source. Confirm current land rates, plot availability and allocation terms directly on the MODON cost of industry portal before committing.
Industrial licence requirements and documents
The exact file depends on your activity and scale, but a foreign manufacturer typically needs the following across the MISA and MIM stages:
| Requirement | Detail |
|---|---|
| Parent company CR | Commercial registration / incorporation certificate of the foreign parent, attested by the Saudi embassy |
| Audited financial statements | Most recent year, to demonstrate financial capability |
| Industrial / feasibility plan | Products, production capacity, technology, raw materials and workforce plan |
| Board resolution | Approving the Saudi investment and appointing the general manager |
| Passport copies | Of shareholders and the appointed general manager |
| Minimum capital | From ~SAR 500,000 for light industry; higher for medium/heavy activities |
| Sector approvals | As applicable: environmental (NCEC), SFDA (food/pharma), SASO (standards) |
All foreign documents must be notarised in the country of origin, legalised by the Saudi embassy and officially translated into Arabic inside the Kingdom. This attestation chain is usually the slowest part of the timeline, so begin it the moment you decide to proceed. The industrial or feasibility plan deserves particular care: MIM and SIDF will read it closely, and a credible plan that quantifies production capacity, technology, raw-material sourcing and Saudisation of the workforce strengthens both your licence application and any financing request.
Depending on the product, you may also need approvals from the National Center for Environmental Compliance, the Saudi Food & Drug Authority (SFDA) for food, cosmetics, medical devices or pharmaceuticals, and the Saudi Standards, Metrology and Quality Organization (SASO) for product conformity. Identify which of these apply to your activity early, because each adds its own review cycle that can run in parallel with the main licensing if planned well.
Incentives: customs exemptions, land, utilities and financing
The industrial track is one of the most heavily incentivised routes into the Saudi market, fully in line with Vision 2030’s goal of building a strong domestic manufacturing base and reducing reliance on imports. Key benefits for licensed factories, especially inside MODON cities, include:
- Customs exemptions on machinery, equipment and raw materials needed for production — these can frequently be imported duty-free, materially reducing the upfront cost of equipping a plant.
- Subsidised industrial land and utilities within MODON zones, with competitive long-term lease rates and supported power, water and gas tariffs in many cases.
- SIDF financing — the Saudi Industrial Development Fund offers concessional loans of up to 75% of eligible project cost for qualifying manufacturers, at favourable terms, dramatically lowering the equity an investor must commit.
- 100% foreign ownership in most manufacturing activities, with no requirement for a Saudi partner and full repatriation of profits.
- One-stop licensing through the integrated MISA–MIM–MODON process, with electronic allocation cutting waiting times.
The customs and SIDF benefits in particular can change the economics of a project. A manufacturer importing a production line worth several million riyals may save a meaningful share of that cost through the machinery exemption, while SIDF financing of up to three-quarters of eligible cost means a relatively modest equity cheque can launch a substantial plant. These incentives are conditional on meeting environmental, safety and operational requirements, so build compliance into your design and plan from day one, and confirm the latest SIDF terms and customs procedures on the official portals before finalising your budget.
The National Industrial Strategy and why it matters
Saudi Arabia’s National Industrial Strategy, delivered through the National Industrial Development and Logistics Program (NIDLP) under Vision 2030, is an ambitious plan to make the Kingdom a leading industrial and logistics hub. The headline target is to grow the number of factories to nearly 36,000 by 2035 — up from around 10,640 industrial facilities in 2022 — alongside major goals for non-oil GDP contribution and hundreds of thousands of new jobs. You can read the program overview on the official Vision 2030 NIDLP page.
For a foreign manufacturer, this strategy is not background colour — it is the reason the incentives above exist and are well funded. Sustained government commitment means financing through SIDF, infrastructure through MODON, fast-track licensing through MISA and MIM, and growing local procurement opportunities are all pulling in the same direction: attracting and retaining industrial investment. The Kingdom is actively prioritising sectors such as automotive, pharmaceuticals, machinery and equipment, food processing, and renewable-energy components, so a project that aligns with these priorities often finds a smoother path and stronger support. Entering now positions your factory inside a market the government is deliberately building out over the coming decade.
MISA licence vs MIM licence: how they differ
Foreign investors often blur the two licences together, but they answer different questions and are issued by different authorities. Keeping them distinct in your plan avoids confusion at the bank, with suppliers and with MODON.
| Aspect | MISA industrial investment licence | MIM industrial licence |
|---|---|---|
| Issuing authority | Ministry of Investment (MISA) | Ministry of Industry & Mineral Resources (MIM) |
| What it grants | Right of a foreign entity to own and operate an industrial business | Right to run the specific factory; entry in the national industrial register |
| When obtained | First, before CR | After CR, in preliminary then final form |
| Key dependency | Activity open to foreign ownership; capital threshold | Land/MODON allocation; environmental and safety compliance |
| Typical validity | Renewed periodically (annually) | One to five years, renewable on compliance |
The simplest way to think about it: the MISA licence makes you eligible to be an industrial investor in the Kingdom, while the MIM licence makes your factory a legally recognised, registered manufacturer. You need both, and they are obtained in sequence with the Commercial Registration in between.
Saudisation, labour and operating the factory
Once the factory is licensed, ongoing operation brings the manufacturer into the workforce and compliance ecosystem managed through Qiwa (labour and contracts), GOSI (social insurance) and Muqeem (residency and visa records). Saudisation — the localisation of jobs under the Nitaqat framework administered by the Ministry of Human Resources and Social Development (MHRSD) — sets targets for the proportion of Saudi nationals in your workforce, with bands that affect your ability to recruit expatriate staff and renew work permits.
Manufacturers are generally well placed to meet these targets because the Kingdom actively supports industrial employment of nationals, and several incentive and training programmes help bridge skills gaps. Factoring a realistic Saudisation plan into your feasibility study from the start is good practice: it strengthens the licence application, supports any SIDF financing case, and avoids friction later when you scale up hiring. Plan your workforce mix, GOSI registration and Qiwa establishment file as part of the launch, not as an afterthought once production has begun.
Operating costs to model alongside labour include subsidised utilities within MODON zones, raw-material logistics, and the periodic renewal of the MIM industrial licence, which is contingent on continued compliance with environmental and safety standards. Building a simple compliance calendar — renewals, GOSI and ZATCA filings, environmental reporting — keeps the factory in good standing and protects the incentives you worked to secure.
How to get an industrial licence: step by step
1. Confirm activity, classification and minimum capital
Match your manufacturing activity to the correct industrial category (light, heavy or transformative) and verify the minimum capital and any sector approvals that apply. Check that the activity is open to full foreign ownership and is not restricted.
2. Prepare and attest documents
Assemble the parent-company CR, audited financials, board resolution and a detailed feasibility plan, then complete notarisation, Saudi embassy legalisation and certified Arabic translation. Start this early — it is the longest pole in the tent.
3. Obtain the MISA industrial investment licence
Apply on the MISA portal with your attested documents and activity details. With a complete file, MISA licensing is typically issued within a few business days, granting you the legal right to proceed as a foreign-owned industrial investor.
4. Register the company (CR) and deposit capital
Reserve the trade name and complete the Commercial Registration with the Ministry of Commerce via the Saudi Business Center, then open a corporate bank account and deposit the required capital so it can be confirmed before you move on.
5. Secure MODON land and the MIM industrial licence
Apply for land allocation in your chosen MODON city, obtain the preliminary MIM industrial licence to build and install machinery, and convert it to a final licence once the factory is ready for production. Electronic land allocation can take roughly 10 to 15 business days once requirements are met.
6. Complete post-licence registrations and apply for financing
Register with the Chamber of Commerce, ZATCA (tax and VAT), GOSI and Qiwa, and arrange Muqeem and visa records for your workforce. If you intend to use concessional financing, submit your SIDF application with the feasibility study in parallel.
Industrial licence cost in Saudi Arabia (2026)
Costs vary widely by scale, but the indicative components in 2026 are set out below. Note that MISA’s licence issuance and renewal fees are currently suspended in 2026 as part of a package of investor facilities, and under recent reforms the industrial-licence financial fee for licensed factories has been waived, with only a nominal permit charge processed electronically. The largest real numbers in an industrial project are not government fees at all — they are land, construction, machinery and working capital. Always confirm current figures on the official portals.
| Cost item | Indicative 2026 figure (SAR) |
|---|---|
| MISA investment licence (issuance) | Fee suspended in 2026 (confirm on misa.gov.sa) |
| MIM industrial licence | Financial fee waived for licensed factories; nominal permit charge |
| Commercial Registration (CR) | ~1,200–2,000 |
| Chamber of Commerce membership | ~2,000–3,000 / year |
| Minimum capital (light industry) | From ~500,000 (deposited, not a fee) |
| MODON land allocation | Per m² lease + monthly allocation fee during build-out |
| Attestation, translation, advisory | Project-specific |
The Noble Core company-setup package starts from SAR 36,999 and covers the MISA application, CR, document attestation and translation, with the industrial-specific MODON land allocation and MIM licence steps scoped to your individual project. Because the customs exemption and SIDF financing can offset a large share of capital cost, the right structuring at the outset often saves far more than the setup fee itself.
Common mistakes to avoid
- Treating the MISA licence as the only requirement and forgetting the separate MIM industrial licence and MODON land allocation.
- Starting document attestation too late — it is the single biggest cause of delays.
- Underestimating minimum capital and sector approvals (environmental, SFDA, SASO) for the specific activity.
- Choosing a MODON city without weighing logistics, ports and raw-material access.
- Missing the monthly land allocation fee window by delaying construction past the build-out period.
- Overlooking SIDF financing, which can fund up to 75% of an eligible project.
- Writing a thin feasibility plan that weakens both the licence application and any financing request.
- Forgetting post-licence registrations (ZATCA, GOSI, Qiwa) needed before you can invoice and hire.
Need help setting up in Saudi Arabia? Noble Core handles your MISA licence, commercial registration, and visas end-to-end — done right the first time.
Frequently Asked Questions
What is an industrial licence in Saudi Arabia?
An industrial licence is the permit that lets a business operate a factory in the Kingdom. A foreign manufacturer needs two approvals: a MISA investment licence from the Ministry of Investment that grants ownership rights, and an industrial licence from the Ministry of Industry & Mineral Resources (MIM) that registers the factory itself.
Who issues the industrial licence — MISA or the Ministry of Industry?
Both play a role. MISA issues the foreign investment licence in the industrial category, while the Ministry of Industry & Mineral Resources (MIM) issues the actual industrial licence and records the factory in the national industrial register. You typically obtain the MISA licence first, register the company, then secure the MIM licence.
What is MODON and do I need it for a factory?
MODON is the Saudi Authority for Industrial Cities and Technology Zones, managing 35+ industrial cities. Most manufacturers set up inside a MODON city to access serviced land, ready infrastructure, subsidised utilities and one-stop licensing. You allocate land through MODON as part of obtaining the MIM industrial licence.
What is the minimum capital for an industrial licence?
Light-industry manufacturing typically starts from a minimum capital of about SAR 500,000, while medium and heavy industrial activities carry higher thresholds set by MISA at the licensing stage. Capital is deposited into the Saudi company’s bank account — it is investment, not a fee. Confirm the exact figure for your specific activity.
What incentives apply to industrial investors in Saudi Arabia?
Licensed factories, especially inside MODON cities, can benefit from customs exemptions on machinery, equipment and raw materials, subsidised land and utilities, 100% foreign ownership in most activities, and SIDF financing of up to 75% of eligible project cost for qualifying manufacturers, subject to compliance conditions.
How long does it take to get an industrial licence?
With a complete, attested file, MISA licensing is generally issued within a few business days, and electronic MODON land allocation can take roughly 10 to 15 business days once requirements are met. The longest variable is usually document attestation and the build-out before the final MIM licence is issued.
What is the National Industrial Strategy?
It is Saudi Arabia’s plan, delivered through the NIDLP under Vision 2030, to become a leading industrial and logistics hub. A headline target is to grow factories to nearly 36,000 by 2035 from around 10,640 in 2022, backed by financing, infrastructure and fast-track licensing for industrial investors.
Can Noble Core help me get an industrial licence?
Yes. Noble Core handles the full industrial setup — activity classification, document attestation and translation, the MISA investment licence, Commercial Registration, MODON land allocation and the MIM industrial licence, plus post-licence registrations with ZATCA, GOSI and Qiwa — end-to-end.
