On the 27 December 2023 the Saudi General Authority for Competition (GAC) held their 85th board meeting. At the meeting the board consider the GAC’s investigation into the automotive after sales market and decided to initiate criminal proceedings against 64 car part businesses.
On the 27 December 2023 the Saudi General Authority for Competition (GAC) held their 85th board meeting. At the meeting the board consider the GAC’s investigation into the automotive after sales market and decided to initiate criminal proceedings against 64 car part businesses. The board also discussed the settlement of several violations of the Saudi competition law. Furthermore, the board decided to implement a fast-track review for merger control review.
In late 2023 GAC announced that they conducted a widespread investigation into the after sales market for the automotive sector. This investigation led to charges being filed against 79 establishments in the automotive sector related to allegations of price-fixing, market division, and other anticompetitive practices. Due to considerable detriment of consumer welfare the board decided to initiate criminal proceedings against 64 businesses. In the case of 15 other businesses that were found to have committed lesser offences settlements were considered. With 64 criminal proceedings being initiated this investigation is among the most far reaching and severe actions taken by GAC to date.
Aside enforcement in the automotive sector the board approved punitive measures against six establishments in the education and manufacturing sectors. The six businesses agreed to corrective measures to avoid more severe sanctions. Moreover, cases against ten other cases were dismissed for lack of jurisdiction.
GAC did not publish details of their findings beyond the very high-level announcement of the number of criminal proceedings initiated and settlements considered. This makes it difficult to assess the reasoning applied by GAC in their assessment of the violations. Still, the announced measures continue the trend of increased monitoring and enforcement of the Saudi antitrust regime by GAC.
At the board meeting, the board also approved an investigation of GAC into the food and beverages sector. While little details have been disclosed so far, it appears that GAC will specifically target ghost kitchens and their effect on the restaurant business.
GAC continuing to expand their enforcement of the Kingdom’s antitrust regime requires companies to revisit their activities in Saudi Arabia. GAC has taken considerable affords to increase awareness for competition law in Saudi Arabia. Still, awareness remains at a comparatively low level especially among local staff and small businesses. Therefore, businesses are well advised to increase their affords to educate and monitor competition compliance of their Saudi staff and partners.
Aside from matters relating to enforcement the board also discussed procedural aspects including the introduction of a fast-track review for merger control review. To date no details on which transactions this fast-track procedure will apply to, what information and documents will have to be provided, review times, and fees have not been released to date. It remains to be seen how impactful the introduction of this fast-track procedure will be.
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