Severe Penalties imposed against Offenders, Including two- year Imprisonment, a Fine of one Million riyals and Ceasing the Commercial Activity
The Ministry of Commerce and Investment announced the implementation of 14,701 inspections tours during 1438H. This is to verify the regularity of commercial institutions and to control those violating the Anti-Commercial Concealment Law in various regions of the Kingdom.
MCI inspection campaigns to combat commercial concealment in various trading sectors resulted in the increase of the cases referred to the Public Prosecution by 93%, compared to 1437H, where 871 cover up cases had been referred to the competent authority for taking the necessary legal procedures. MCI had referred 290 cover up cases to the Public Prosecution during 1436H, compared to 450 cases in 1437.
In accordance with article 2 of the Anti-Commercial Concealment law, the Ministry of Commerce and Investment is responsible for implementing the provisions of this law, by inspecting, investigating, controlling and receiving reports and complaints about any violation, while the Public Prosecution is responsible for the investigation and prosecution before the judicial authorities.
MCI inspection campaigns during 1438 AH resulted in inspecting 1323 commercial institutions related to various sectors. Currently, MCI has been investigating, following up and hearing the statements for 2,184 cases, so that the final procedures can be completed.
During the same period, the Ministry also referred 309 cover-up cases to the competent authorities at the Ministry of Labor and Social Development, the Saudi Arabian Monetary Agency for taking the legal procedures and imposing the penalties against the violators.
The results of the inspection tours showed certain trading activities in violation of the Anti-Commercial Concealment Law, including construction, retail, textiles and furniture sector.
MCI have taken all the necessary procedures to control the cases in violation, as well as to implement all relevant R&R, which may reach to two-year imprisonment, a fine of one million riyals against each offender, deporting the non-Saudis from the Kingdom, in addition to defaming the names of violators in the local newspapers at their expense, besides ceasing the commercial activity, writing off the C.R. and closing the shop.
Notably, MCI carried out intensive inspection campaigns during 1438 AH, to combat all kinds of cover-up in various trading sectors, including upholstery, office and household furniture, computer shops, telecommunications and relevant accessories, auto parts and dates factories, besides processing all complaints and reports received from citizens, residents or relevant government agencies.
The Ministry has launched the initiative of “The National Program for Combating the Commercial Concealment” as part of its initiatives in the National Transformation Program 2020, which are based on the implementation of 6 key measures to combat and eliminate the commercial concealment, as it is one of the main causes of commercial fraud.
These measures are contained in monitoring the sources of funds, by obliging the commercial institutions to open bank accounts, also making dealing with invoices a must. This may reduce foreign remittances, besides providing accurate information on the real practices of business activities in violation. This is for combating commercial cover-up and for stimulating investment, besides upgrading the level of services provided to the consumer, in addition to the consolidation of the government efforts in this regard, as well as to effect the nationalization of jobs and to create fair competition in the commercial sector, so that to make the Saudi market an attractive environment for investors.
MCI is endeavoring to combat commercial concealment in all trading sectors and business activities through several stages, starting with the retail sector and then the construction, as these sectors constitute the highest percentage of commercial cover –up cases, followed by other sectors.
Finally, MCI aims to combat and eliminate the commercial concealment, as well as to create a regular trading environment free of any violations, so that to enable the citizens of starting a business safely.