Eliminating Minimum Capital Requirement and Facilitating Business Start-Up in Saudi Arabia
With the 10-by-10 initiative's inception, the Saudi Arabian General Investment Authority (SAGIA) created the National Competitiveness Center (NCC) in June 2006. Monitoring, assessing, and supporting the simplification of the business entry pro...
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| Format: | Brief |
| Language: | English |
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World Bank, Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2007/10/9890773/eliminating-minimum-capital-requirement-facilitating-business-start-up-saudi-arabia http://hdl.handle.net/10986/10642 |
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okr-10986-106422021-04-23T14:02:51Z Eliminating Minimum Capital Requirement and Facilitating Business Start-Up in Saudi Arabia Al-Awwad, Dr. Awwad ADVISORY SERVICES ARTICLES OF ASSOCIATION BANK ACCOUNT BUSINESS ENTRY BUSINESS ENVIRONMENT BUSINESS REGISTRATIONS BUSINESSES CAPITAL REQUIREMENT CHAMBER OF COMMERCE CIVIL CODE COMMERCIAL PAPERS COMPANY LAW COMPETITIVENESS CONTRIBUTION DEPOSIT EMPLOYER ENTREPRENEUR ENTREPRENEURIAL ACTIVITY GROSS DOMESTIC PRODUCT INCOME INCOME TAX INITIAL CAPITAL INSURANCE INVESTMENT OPPORTUNITIES LABOR FORCE LABOR MARKET LEGISLATIVE REFORM LICENSE LIMITED LIMITED LIABILITY LIMITED LIABILITY COMPANIES LIMITED LIABILITY COMPANY MEDIUM ENTERPRISES MIDDLE EAST MINIMUM CAPITAL REQUIREMENT MUNICIPALITY NEW BUSINESS NEW COMPANY NEW JOBS NORTH AFRICA NOTARY NOTARY PUBLIC PROSPERITY PROTOCOL RESULTS SOCIAL INSURANCE SOLE PROPRIETORSHIPS START-UP TARGETS TAX TREATIES UNEMPLOYMENT With the 10-by-10 initiative's inception, the Saudi Arabian General Investment Authority (SAGIA) created the National Competitiveness Center (NCC) in June 2006. Monitoring, assessing, and supporting the simplification of the business entry process were among its main roles. The NCC observed in June 2006 that entrepreneurial activity in Saudi Arabia was low. One of the reasons was the fact that the process for starting a business was lengthy exceeding 5 weeks and costly, with one of the highest minimum paid-in capital (MPIC) requirements in the World- US$125,000. Businesses still started and were registered, but only 12,194 were limited liability companies, versus 646,900 sole proprietorships. Starting a limited liability company was simply too costly. Saudi Arabia boldly eliminated the minimum capital requirement, which was 1,057 percent of income per capita. And it was done in four months, reversing the common belief that dropping the minimum capital requirement entails years of legal procedures and debates. The author also cut other start-up formalities, decreasing the number of procedures from 13 to seven. In one year, the country's rank in the ease of starting a business soared from 159 to 36 in doing business 2008. Last but not least, new business registrations jumped 81 percent. The author suggest there were three key factors: (a) disregard the argument that this is the way it was always done, and go for quick wins to create momentum; (b) use a results-based incentive system, with credit for the ones that deliver; and (c) use facts to build coalitions and speed up the process. 2012-08-13T12:32:40Z 2012-08-13T12:32:40Z 2007-10 http://documents.worldbank.org/curated/en/2007/10/9890773/eliminating-minimum-capital-requirement-facilitating-business-start-up-saudi-arabia http://hdl.handle.net/10986/10642 English IFC Smart Lessons Brief CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Brief Publications & Research Middle East and North Africa Saudi Arabia |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
ADVISORY SERVICES ARTICLES OF ASSOCIATION BANK ACCOUNT BUSINESS ENTRY BUSINESS ENVIRONMENT BUSINESS REGISTRATIONS BUSINESSES CAPITAL REQUIREMENT CHAMBER OF COMMERCE CIVIL CODE COMMERCIAL PAPERS COMPANY LAW COMPETITIVENESS CONTRIBUTION DEPOSIT EMPLOYER ENTREPRENEUR ENTREPRENEURIAL ACTIVITY GROSS DOMESTIC PRODUCT INCOME INCOME TAX INITIAL CAPITAL INSURANCE INVESTMENT OPPORTUNITIES LABOR FORCE LABOR MARKET LEGISLATIVE REFORM LICENSE LIMITED LIMITED LIABILITY LIMITED LIABILITY COMPANIES LIMITED LIABILITY COMPANY MEDIUM ENTERPRISES MIDDLE EAST MINIMUM CAPITAL REQUIREMENT MUNICIPALITY NEW BUSINESS NEW COMPANY NEW JOBS NORTH AFRICA NOTARY NOTARY PUBLIC PROSPERITY PROTOCOL RESULTS SOCIAL INSURANCE SOLE PROPRIETORSHIPS START-UP TARGETS TAX TREATIES UNEMPLOYMENT |
| spellingShingle |
ADVISORY SERVICES ARTICLES OF ASSOCIATION BANK ACCOUNT BUSINESS ENTRY BUSINESS ENVIRONMENT BUSINESS REGISTRATIONS BUSINESSES CAPITAL REQUIREMENT CHAMBER OF COMMERCE CIVIL CODE COMMERCIAL PAPERS COMPANY LAW COMPETITIVENESS CONTRIBUTION DEPOSIT EMPLOYER ENTREPRENEUR ENTREPRENEURIAL ACTIVITY GROSS DOMESTIC PRODUCT INCOME INCOME TAX INITIAL CAPITAL INSURANCE INVESTMENT OPPORTUNITIES LABOR FORCE LABOR MARKET LEGISLATIVE REFORM LICENSE LIMITED LIMITED LIABILITY LIMITED LIABILITY COMPANIES LIMITED LIABILITY COMPANY MEDIUM ENTERPRISES MIDDLE EAST MINIMUM CAPITAL REQUIREMENT MUNICIPALITY NEW BUSINESS NEW COMPANY NEW JOBS NORTH AFRICA NOTARY NOTARY PUBLIC PROSPERITY PROTOCOL RESULTS SOCIAL INSURANCE SOLE PROPRIETORSHIPS START-UP TARGETS TAX TREATIES UNEMPLOYMENT Al-Awwad, Dr. Awwad Eliminating Minimum Capital Requirement and Facilitating Business Start-Up in Saudi Arabia |
| geographic_facet |
Middle East and North Africa Saudi Arabia |
| relation |
IFC Smart Lessons Brief |
| description |
With the 10-by-10 initiative's
inception, the Saudi Arabian General Investment Authority
(SAGIA) created the National Competitiveness Center (NCC) in
June 2006. Monitoring, assessing, and supporting the
simplification of the business entry process were among its
main roles. The NCC observed in June 2006 that
entrepreneurial activity in Saudi Arabia was low. One of the
reasons was the fact that the process for starting a
business was lengthy exceeding 5 weeks and costly, with one
of the highest minimum paid-in capital (MPIC) requirements
in the World- US$125,000. Businesses still started and were
registered, but only 12,194 were limited liability
companies, versus 646,900 sole proprietorships. Starting a
limited liability company was simply too costly. Saudi
Arabia boldly eliminated the minimum capital requirement,
which was 1,057 percent of income per capita. And it was
done in four months, reversing the common belief that
dropping the minimum capital requirement entails years of
legal procedures and debates. The author also cut other
start-up formalities, decreasing the number of procedures
from 13 to seven. In one year, the country's rank in
the ease of starting a business soared from 159 to 36 in
doing business 2008. Last but not least, new business
registrations jumped 81 percent. The author suggest there
were three key factors: (a) disregard the argument that this
is the way it was always done, and go for quick wins to
create momentum; (b) use a results-based incentive system,
with credit for the ones that deliver; and (c) use facts to
build coalitions and speed up the process. |
| format |
Publications & Research :: Brief |
| author |
Al-Awwad, Dr. Awwad |
| author_facet |
Al-Awwad, Dr. Awwad |
| author_sort |
Al-Awwad, Dr. Awwad |
| title |
Eliminating Minimum Capital Requirement and Facilitating Business Start-Up in Saudi Arabia |
| title_short |
Eliminating Minimum Capital Requirement and Facilitating Business Start-Up in Saudi Arabia |
| title_full |
Eliminating Minimum Capital Requirement and Facilitating Business Start-Up in Saudi Arabia |
| title_fullStr |
Eliminating Minimum Capital Requirement and Facilitating Business Start-Up in Saudi Arabia |
| title_full_unstemmed |
Eliminating Minimum Capital Requirement and Facilitating Business Start-Up in Saudi Arabia |
| title_sort |
eliminating minimum capital requirement and facilitating business start-up in saudi arabia |
| publisher |
World Bank, Washington, DC |
| publishDate |
2012 |
| url |
http://documents.worldbank.org/curated/en/2007/10/9890773/eliminating-minimum-capital-requirement-facilitating-business-start-up-saudi-arabia http://hdl.handle.net/10986/10642 |
| _version_ |
1764413845203320832 |