Transactions that combine businesses above certain market-share or turnover thresholds require a filing with the General Authority for Competition before closing, and closing without clearance where a filing was required can expose the parties to penalties and, in some cases, an order to unwind the transaction.
Assessing whether a transaction triggers this requirement is worth doing early in deal planning, since a required filing affects the transaction timeline and shouldn't be discovered late in negotiations. On the deal side, this analysis runs alongside our mergers & acquisitions practice from the first structuring conversations.
GAC also investigates conduct that restricts competition — price-fixing arrangements between competitors, abuse of a dominant market position, and exclusive dealing terms that foreclose competitors from a market — whether raised by a competitor's complaint or GAC's own market monitoring.
Businesses drafting distribution, exclusivity, or pricing arrangements benefit from a competition-law review before signing, since terms that seem commercially reasonable can still raise concerns depending on the parties' market positions. Agency and distribution agreements in particular sit at this intersection, covered in depth under our commercial agency & distribution practice.
Under GAC's current Economic Concentration Review Guidelines, notification becomes mandatory once cumulative thresholds are met — broadly, combined worldwide turnover of at least SAR 200 million, combined local Saudi turnover of at least SAR 40 million, and in certain transaction types the target's own worldwide turnover at SAR 40 million or more. A relatively recent addition to this framework is the local Saudi turnover test specifically, which can catch foreign-to-foreign transactions with real activity inside the Kingdom even where no party is Saudi-incorporated.
GAC also retains authority to open a post-closing review of a transaction that should have been notified but wasn't, with real consequences ranging from fines to an order unwinding the deal — which makes an early threshold check standard practice on any transaction with meaningful scale, not an optional formality.
An investigation typically opens with an information request — documents, agreements, and internal communications relevant to the conduct in question — followed potentially by interviews with company personnel, and the way a business responds to this initial phase often shapes how the rest of the investigation goes far more than most companies expect.
Businesses that engage counsel from the first information request, rather than after a preliminary finding, are generally in a stronger position to shape how their conduct is characterized and to identify legitimate business justifications for practices that might otherwise look concerning in isolation. Where an investigation escalates toward enforcement, our disputes & litigation team joins the defense.
Broadly, combined worldwide turnover of at least SAR 200 million, combined local Saudi turnover of at least SAR 40 million, and in certain cases the target's own worldwide turnover at SAR 40 million or more — we'll assess your specific transaction against the current guidelines.
Generally no — direct price-fixing between competitors is one of the clearest violations under Saudi competition law, with very limited exceptions. We can advise if your situation might fall into an exception.
GAC investigations typically involve information requests and interviews before any finding is made. Getting legal representation early in the process improves how the business's position is presented and documented.
Yes, potentially — the local Saudi turnover test can catch transactions with real effect inside the Kingdom even where neither party is Saudi-incorporated, a point deal teams often underestimate.
Engage counsel before drafting a response, not after — how the initial response frames the conduct in question often shapes the trajectory of the entire investigation.
No — exclusivity is common and generally lawful, but it can raise concerns depending on how much of the market it forecloses and the parties' relative market power, which is why a review before signing matters.
Expert Riyadh