Saudi Arabia: Licensing Requirements And Restrictions For Hospitals In The MENA Region: Challenges & Opportunities

Last Updated: 15 January 2018
Article by Samer Qudah and Izabella Szadkowska

Establishing a hospital in the MENA region or investing into an existing medical facility is of significant interest for investors globally.

From press releases and a general exchange of updates amongst members of business community, we have been learning, quite regularly, of new healthcare sector investments.

Last year, NMC Group announced their acquisition of Sharjah's Al Zahra Hospital for AED 2.06 billion. Amanat Holdings PJSC has a number of healthcare assets under its investment portfolio and continues to grow. Aster DM Healthcare has lately opened a new hospital, has added new specialities and services under their existing facilities, and increased bed capacity, as well as upgrading their diagnostic technologies.

Although hospitals require highly-qualified manpower to be able to expand their operations, a growing and aging population in the MENA region inevitably lead to an increased level of use of medical services, particularly medical facilities by both in-and out-patients.

In investing in hospitals across the MENA region, investors must navigate country-specific regulatory requirements and restrictions. This article explores some of the basic requirements and restrictions imposed under relevant local law in relation to hospitals operation in Bahrain, Egypt, Iraq, Jordan, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.

Regulatory Authorities

The most important aspect of a hospital licensing process is securing its healthcare regulatory license. In a majority of the GCC/MENA states, the role of the healthcare sector regulatory, and consequently the supervisory, body overseeing licensing and operations of hospitals has been the Ministry of Health. In the UAE, however, although the Ministry of Health looks after the licensing of hospitals in few emirates, the Dubai Health Authority performs this role in the Emirate of Dubai and the Healthcare Authority of Abu Dhabi performs this role in Abu Dhabi.

Commercial Registrars

There are regional differences across the MENA region in relation to commercial registration. Whilst in Bahrain hospitals are registered at the Ministry of Industry, Commerce and Tourism, in Egypt that role has been assigned to the Commercial Registry Office. In Kuwait, on the other hand, Ministry of Commerce and Industry takes care of the commercial registrations of hospitals.

Local Ownership Restriction

As with most other decisions about setting up a business or acquiring a stake in an existing business in the GCC healthcare sector, parties will have to pay attention to local ownership restrictions that may attach to the shares in the hospital-operating entity as well as to the assets the hospital is to own (for example, real estate).

In Egypt, for instance, any foreign national can own shares in a hospital, except for certain geographical regions (e.g. Sanai) where foreign investment restrictions apply.

Under UAE or Kuwait law, on the other hand, at least 51% of the entity that operates a hospital must be owned by local shareholder(s).

In the Kingdom of Saudi Arabia, before a non- Saudi party acquires shares in a hospital operator, that party will have to secure a license from the Saudi Arabian General Investment Authority.

Finally, in some GCC states, there are also certain nationality requirements in respect of medical staff or a Manager/ Director of the medical facility. This should be looked into country by country as there are differences between the local legal requirements in this regard.

Licensing requirements:

The licensing requirements that apply to hospital license applicants are, broadly speaking, aligned across the GCC. However, care should be taken to check country-specific requirements.

By way of example, in Oman a hospital entity will be required to have a capital of not less than OMR 150,000 (USD 390,000).

In Qatar, the authorities will conduct a preliminary evaluation of the hospital's premises and facilities while in the Kingdom of Saudi Arabia the location of the hospital will need to be approved by Civil Defense and the relevant local municipality office.

Practical Considerations

Although the legal requirements may look standard in a number of ways, it is crucial that you consider certain practicalities that may arise under the hospital incorporation or acquisition process that might not have been explicitly addressed under local law.

Let's consider the UAE, for example. Although in other jurisdictions a common expectation would be that the license be issued in the name of an entity that has applied for and obtained the license, as far as the UAE and the health authorities are concerned, in practice, sometimes Health Authorities issue the Health License in the name of the individual(s) local shareholder(s) in the relevant entity (i.e. the direct or indirect shareholder(s) in a given entity) or list the shareholder(s) as "Owner" of the license in question, rather than mentioning the given entity itself as the license holder or mentioning all of its shareholders as the license holders.

In other words, in such case, under a Health License the local (direct or indirect) shareholder(s) is listed as the "Owner" of the license.


When planning for an establishment or acquisition of certain shares in or assets from a hospital, it is important to verify ownership restrictions to comply with local requirements.

As certain legal requirements and conditions, e.g. level of foreign investment or ownership of plot of land upon which the hospital has been built, can differ from one MENA state to another, it is important to thoroughly assess options that may be available to your business even though, at the outset, there are many structuring and licensing challenges.

The legal framework may appear restrictive. However, there are various options available that meet commercial business objectives as well as satisfy the legal requirements.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions