SR14.89 million fines imposed on 6 companies for Competition Law violation

Saudi Gazette Report

JEDDAH — The General Authority for Competition announced the imposition of fines amounting to SR14.89 million on six companies and establishments operating in the car and goods transport sector. This is for the violation of the provisions of the Competition Law following their agreement to increase charges for vehicle transportation, the authority said in a statement on Wednesday.

The decision included imposing a fine of SR5 million on MB International Company; a fine of SR5 million on RT Company for Transporting Goods; a fine of SR1,900,000 on N.B.A. Corporation; a fine of SR1,500,000 on A.A.A.H. Company and T. Transportation Company; a fine of SR790,000 on S.K.S. Company, and a fine of SR700,000 on DDN Company.

The committee’s decision has become final with the issuance of final rulings by the competent court, turning down the establishments’ objection to the committee’s decision issued against them.

The authority’s Board of Directors gave the go-ahead to carry out investigation into the violations committed by these firms, and accordingly it referred the violations to the Committee for Adjudication of Competition Law Violations, which in turn, issued its decision to take punitive measures against the companies and entities involved in the violations.

It was found in investigations that the firms violated paragraph 1 of article 4 of the Competition Law. This provision prohibits practices, agreements, or contracts between competing establishments or those that are likely to be competitors, whether the contracts are written or oral, explicit or implicit, provided that the aim of these practices, agreements, or contracts, or the effect resulting from them, is to restrict trade or disrupt competition between establishments. The law specifically mentions the violation involving controlling the prices of goods and services prepared for sale by increasing, decreasing, stabilizing, or in any other way that harms legitimate competition.

The authority revealed that the penal measures are based on the authority’s missions and powers in saving the Competition Law, as well as as an extension of its role in protecting and encouraging fair competition and combating monopolistic practices. This is also to achieve the principle of transparency of procedures following violation of the Competition Law and its executive regulations by agreeing to raise prices for transporting vehicles which is prohibited under paragraph 1 of article 5 of the Competition Law.

The General Authority for Competition called on all establishments to adhere to the Competition Law and its executive regulations, and to work with the contents of the competition. The authority also called on all establishments to review the guidelines on ways to comply with the Competition Law through the “Compliance Portal” via the following link: https://emtithal.gac.gov.sa

The authority aims to adopt the competition-stimulating policies, combat illegal monopolistic practices with a view to improving market performance to support the consumer and business sector confidence, contribute to investments flow and enhance sustainable development.