Trade Name Registration in Saudi Arabia: Complete Guide and Benefits

If you are an investor planning to set up a business in Saudi Arabia, there are a few essential legal frameworks your business should comply with. One such important law is choosing the right company name. 

The Law of Trade Names, in the KSA (Kingdom of Saudi Arabia), regulates the use, registration, and protection of company names. It ensures fair business practices and competition, prevents fraudulent business practices, and grants businesses legal recognition for their chosen company name. 

This blog will provide a simple guide to the Law of Trade Name in Saudi Arabia, including what it is, its benefits, the registration process, important considerations, and costs. 

What is the Law of Trade Name?

A trade name is the official legal name under which a business is allowed to operate. It is the name that is used and appears on all legal documents, contracts, and marketing materials. A trade name provides legal protection and prevents competitors from using similar names within the same industry. 

The main purpose of the  Law of Trade Name in Saudi Arabia is to: 

• Simplify the procedures for registering and renewing trade names.

• Ensure that businesses operate under clear, distinctive, and officially recognised company names.

• Provide legal protection and remedies in cases of trade name infringement or unauthorised use.

• Prevent confusion, misleading practices, and unfair competition in the marketplace.

This law applies to all companies, establishments, and individuals engaged in commercial or trade activities within the Kingdom. Compliance with this law is essential regardless of a business sector or structure to legally operate with a selected trade name in Saudi Arabia. 

What are The Benefits of Trade Name Registration?

• Essential for Commercial Registration (CR) Issuance

Legally, a business cannot obtain a Commercial Registration without an approved trade name. This makes trade name registration an inevitable step in forming a company. So a trade name simplifies the business setup process within Saudi Arabia. 

• Legal Protection for Your Business Identity

One of the main benefits of trade name registration is getting legal protection for your business. It prevents other businesses and, most importantly, competitors from using the same name.

• Strengthens Brand Recognition and Credibility

A registered trade or company name in Saudi Arabia is important to establish credibility, legitimacy, and to build trust with government entities, partners, customers, and employees. 

• Helps Avoid Market Confusion

The trade name registration process ensures your business name is unique to your company, reducing the risk of confusion with other business names among customers. This helps your business safeguard your market position, image, and brand identity. 

• Supports Intellectual Property Protection

Registered trade names can be used as part of wider IP protection strategies, including trademarks.

• Required for Government and Banking Processes

Having a registered trade name is a prerequisite to opening a bank account, signing contracts, and completing regulatory procedures. 

• Ensures Proper Regulatory Linking Through the National Address

Once your trade name is added to the Commercial Registration (CR) to set up a business, it must be associated with your company’s verified National Address. This is important to ensure government authorities, business partners, and employees can accurately identify the business location. Using a verified company or trade name is also important to efficiently deliver official correspondence, mail, and to maintain regulatory records. 

Failure to comply with the Law of Trade Names can result in legal consequences such as fines, penalties, suspension of business operations, and trade name disputes that can lead to a bad reputation and compensation claims. 

Important Considerations for Trade Name Selection

Here are a few key considerations to make when selecting a company name for your business: 

• Uniqueness: The name should not be similar to or identical to any other existing businesses.

• Language: The company name should be in Arabic or have an Arabic translation.

• Relevance: The name should reflect the nature or type of business activity. 

Restrictions on Trade Names

According to the Saudi Law of Trade Names, there are certain restrictions on trade name selection. They are: 

• Deceptive Names: A trade name should not mislead customers or convey a deceptive meaning about the nature of the business, or its services and products. 

• Protected or Reserved Names: A business cannot use any names that are related or similar to government entities, religious institutions, or reputed international brands. You will need special permission to use them. 

• Similar or Conflicting Names: According to the law, businesses cannot use a trade name that is too similar to that of other registered businesses in the same industry. This restriction is to reduce the risk of confusion and brand dilution.

Steps for Trade Name Registration in Saudi Arabia

Step 1: Check Trade Name Availability

The first step to trade name registration is to check its availability. You can do this via the MOC’s official website using their trade name search tool. Make sure the chosen trade name follows the specified legal criteria. 

Step 2: Reserve the Trade Name

Once you have confirmed availability, reserve the name.Log in to MOC’s electronic services portal and select the trade name reservation service.

Step 03: Submit Application 

Then fill out the trade name registration form, giving accurate details about the business type, structure, and chosen trade name. 

Step 04: Payment of Fees 

Pay the required fees, which vary depending on the type and size of the company.

Step 05: Approval Process

The Ministry of Commerce will review the application to ensure the name complies with established regulations. The approval process takes 1-2 business days. If approved, the trade name will be officially registered.

Step 06: Receive Registration Certificate 

Once approved by the Ministry of Commerce, you will receive a Trade Name Registration Certificate, which grants your business the legal rights to use the trade name in all forms of operations. 

Cost of Trade Name Registration in Saudi Arabia

The exact cost of trade name registration varies depending on the type of business, size, and location. Generally, they include: 

• Trade Name Reservation Fee: SAR 200

• Trade Name Registration Fee: SAR 1,000 (depending on business structure)

• Additional Fees: Publication fees and VAT (if applicable)

Simplify Your Business Setup with TEC 

As one of the leading providers of flexible workspace solutions, TEC TEC also offers National Address plans that complement the trade name registration process, supporting new businesses as they establish their legal presence in Saudi Arabia. It provides businesses with the flexibility to scale and adapt seamlessly to the evolving work environment without the challenges of managing a physical workspace.

Our national addresses in Riyadh, King Abdullah Financial District (KAFD), give organisations a prestigious brand image, credibility, and opportunities for valuable networking within the community. 

For more details, call us at +966 11 500 6600 or get in touch with us for a customised solution. 

Key Takeaways 

• A trade name must be distinctive and not identical or confusingly similar to existing registered names.

• Registration grants legal protection and exclusive rights to use the name in Saudi Arabia.

• The Ministry of Commerce oversees the approval, registration, and monitoring of trade names.

• Businesses must ensure the name reflects their commercial activity and complies with Saudi regulations.

• Violations such as misleading names or unauthorised use can result in fines, suspensions, or legal action.

• Renewal of the trade name is required to maintain active legal status and protection.

• A properly registered trade name enhances business credibility and market recognition.