Decree Amending the Unified System for Combating Commercial Fraud in GCC Countries
A Law Decree No. 93 of 2026 amending Article (11) of the Unified Law (Regulation) on Combating Commercial Fraud of the Gulf Cooperation Council (GCC) States, issued under Law No. 20 of 2019, was published in the official gazette, “Al-Kuwait Al-Youm.” The provisions of the decree are as follows:
Article 1: The text of Article (11) of the Unified Law (Regulation) on Preventing Commercial Fraud of the GCC States, annexed to the aforementioned Law No. 20 of 2019, is replaced with the following:
“Any person who violates the provisions of Articles (2), (3), and (5), and subparagraphs (a) and (b) of Article (8) of this Law (Regulation) shall be punished with imprisonment for a term not exceeding two years, and/or a fine of not less than 5,000 (five thousand) Saudi Riyals or the equivalent in the currencies of the GCC States, and not more than 1,000,000 (one million) Saudi Riyals or the equivalent in the currencies of the GCC States, or with either of these two penalties.”
Article 2: Ministers shall, each within their respective competence, implement this Law Decree. It shall enter into force from the date of its publication in the official gazette.
The explanatory memorandum to Law Decree No. 93 of 2026 amending Article (11) of the Unified Law (Regulation) on Combating Commercial Fraud of the GCC States, issued under Law No. (20) of 2019, states the following:
Law No. (20) of 2019 was issued, incorporating the Unified Law (Regulation) on Combating Commercial Fraud of the GCC States. It regulated the provisions for combating commercial fraud, specified the prohibited forms of fraud, established the obligations imposed on suppliers, and set out the rules concerning the seizure and disposal of fraudulent goods, in addition to prescribing the penalties for violating its provisions.
Article (2) of the aforementioned Law specified the prohibited forms of commercial fraud. Article (3) obligated the supplier to withdraw fraudulent goods from the markets and warehouses. Article (4) established the presumption that the supplier is aware of the nature of the fraudulent goods. Article (5) required the supplier to refund the value of the fraudulent goods to the buyer. Meanwhile, Article (6) granted judicial enforcement powers to a category of employees tasked with enforcing the provisions of the Law.
Article (11) of the aforementioned Law had prescribed penalties for violating the provisions of Articles (3), (4), and (6), and subparagraphs (a) and (b) of Article (8), without including references to Articles (2) and (5), despite the fact that these articles contain substantive provisions directly related to the prohibited forms of commercial fraud and the obligation to refund the value of the fraudulent goods to the buyer.
Furthermore, Articles (4) and (6) do not contain prohibited acts or omissions that, in themselves, constitute grounds for criminalization and punishment. Article (4) establishes a presumption regarding the supplier’s knowledge of the nature of the adulterated goods, while Article (6) regulates the granting of judicial police powers to certain officials.
A review of the original wording of Article (11) of the Unified Law (Regulation) on Combating Commercial Fraud in the Gulf Cooperation Council (GCC) States—as adopted by the Supreme Council of the GCC in its thirty-seventh session, held in the Kingdom of Bahrain from 6 to 7 December 2016—and the GCC General Secretariat’s communication regarding a typographical error in the text of the said article, revealed that Article (11) was subsequently amended to align with the legislative intent, so that the penalty covers violations of Articles (2), (3), and (5), as well as paragraphs (a) and (b) of Article (8).
Accordingly, the present Law-Decree was issued to rectify the error in the cross-references stipulated in Article (11) of the aforementioned Unified Law (Regulation) on Combating Commercial Fraud in the GCC States, and to harmonize the national text with the correct amended text of that Unified Law (Regulation).
Article 1 of the present Law-Decree provides for the replacement of the text of Article (11) thereof, with the effect that the penalty shall cover violations of Articles (2), (3), and (5), as well as paragraphs (a) and (b) of Article (8), and excludes the reference to Articles (4) and (6).
Article 2 provides that the Law-Decree shall enter into force from the date of its publication in the Official Gazette.
Given that the Amir’s Order was issued on 2 Dhul-Qa’dah 1445 AH, corresponding to 10 May 2024, and Article 4 thereof stipulates that laws shall be issued by Law-Decrees, the present Law-Decree was accordingly prepared.
