- 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:
- 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).
- 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).
- 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
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