Anti-Commercial Fraud Law

Purpose and scope

• Protects consumers and the market from commercial fraud, punishing anyone who deceives or attempts to deceive others in products by adulterating or imitating them or misleading consumers about their nature, origin or quantity (Article 2).
• It replaced the previous Anti-Commercial Fraud Law; violations are detected by officers of the Ministry of Commerce and other competent bodies such as municipalities and the Food and Drug Authority (Article 5).

Key rules, rights and obligations

• A producer, importer or distributor who has supplied a fraudulent product must immediately inform the Ministry of the quantity and the traders it was supplied to (Article 3).
• Discounts and commercial competitions may be held only under the rules set by the regulation (Article 4).
• A trader may not dispose of a suspected product before the test result is out (Article 7); the competent body issues test results for food within fifteen days (Article 8).
• An offender is presumed to know the product was fraudulent (Article 14), and the seller, whoever supplies for his account and managers of businesses are liable, unless one proves the violation was beyond his control (Article 15).
• The violator must withdraw the fraudulent product and refund the buyer, without prejudice to compensation (Article 22).

Violations, penalties and common problems

• Fraud and deception: a fine of up to SAR 500,000 or up to two years' imprisonment, or both (Article 16), and the shop may be closed for up to one year (Article 20).
• Fraud involving false scales, measures or hallmarks, or products harmful to health: a fine of up to SAR 1 million or up to three years' imprisonment, or both (Article 18).
• Breaching discount and competition rules: a fine of up to SAR 50,000 or up to six months' imprisonment, or both (Article 17); disposing of seized goods: a fine equal to their value (Article 19).
• Repeat within five years: up to double the maximum (Article 24); the judgment summary is published at the offender's expense (Article 25), and fraudulent products are destroyed in all cases (Article 21).
• Anyone who helps uncover fraud may receive a reward of up to 25% of the fine collected (Article 11).

Procedures and key deadlines

• The Public Prosecution investigates and prosecutes, and the competent court decides violations and compensation claims (Articles 12 and 13 as amended).
• In urgent cases the Minister may order precautionary seizure and withdrawal of a product, to be put to the competent court within seventy-two hours for confirmation or cancellation (Article 27 as amended).
• Consumers can report fraud through the Ministry of Commerce channels, keeping the invoice and a sample of the product if possible.

An advisory summary prepared by Al-Bayan Al-Wadih Law Firm. It is not an official text and does not replace the law, its implementing regulations, or advice from a specialised lawyer. The official published text and its amendments prevail.