- How are Fines and Penalties Estimated in Competition Law?

The Competition Law imposes strict penalties to deter monopolistic practices. The Implementing Regulations (Articles 45-53) clarify how these penalties are estimated.

Value of Financial Fines

According to Article Nineteen of the Law, penalties are estimated as follows:

1. Severe Violations (Monopoly and Dominance):
   • Fine not exceeding 10% of total annual sales.
   • Or fine not exceeding 10 Million Riyals (when estimating sales is impossible).
   • Or 3 times the gains achieved (if greater than the specified cap).
2. Investigation Obstruction Violations (Withholding Information):
   • Fine not exceeding 5% of total annual sales.
   • Or fine not exceeding 5 Million Riyals (when estimating sales is impossible).
3. Other Violations:
   • Fine not exceeding 2 Million Riyals for any other violation of the Law or Regulation.

Doubling Penalty (Recidivism)

If the violator returns to commit the same violation within 3 years, the Committee may double the fine.

Administrative Measures

In addition to fines, the Board may take measures (Article 21) including:

• Obligation to correct situations within a specific period.
• Daily fine not exceeding 10,000 Riyals until violation is removed.
• Temporary closure of establishment for a period not exceeding 30 days.
• Order to sell some assets or shares to break the monopoly.

Naming and Shaming (Publication)

The penalty decision is published at the violator's expense in a local newspaper or media outlet after the judgment becomes final.

Reference: Competition Law (Articles 19-22) - General Authority for Competition