Legislative amendment tightens criminal scope in the Gulf system for combating commercial fraud

A decree-law No. 93 of 2026 amending Article (11) of the Unified Law (Regulation) on Combating Commercial Fraud in the Gulf Cooperation Council (GCC) States, issued by Law No. 20 of 2019, was published in the official gazette, Al-Kuwait Al-Youm. The amendment aims to correct the scope of the references in the article concerning penalties and to align the national text with the correct formulation of the Unified GCC Regulation.

The amendment stipulates that any person who violates the provisions of Articles (2), (3), and (5), as well as paragraphs (a) and (b) of Article (8), shall be punished with imprisonment for a period not exceeding two years and a fine of not less than 5,000 Saudi Riyals or the equivalent in the currencies of the GCC States, and not exceeding one million Saudi Riyals or the equivalent, or with either of these two penalties.

The articles subject to these penalties relate to the prohibited forms of commercial fraud, the obligation to withdraw fraudulent goods from markets and warehouses, and the refund of the value of the fraudulent goods to the buyer, in addition to the provisions set out in paragraphs (a) and (b) of Article (8).

The explanatory memorandum clarified that Law No. 20 of 2019 regulated the provisions on combating commercial fraud, defined the prohibited forms of fraud and the obligations of the supplier, and included provisions related to the seizure and disposal of fraudulent goods, as well as the penalties prescribed for violating the regulation.

It noted that the previous formulation of Article (11) imposed penalties for violating the provisions of Articles (3), (4), and (6), and paragraphs (a) and (b) of Article (8), without including Articles (2) and (5), despite their relevance to fundamental provisions concerning the forms of commercial fraud and the obligation to refund the value of the fraudulent goods to the buyer.

The memorandum indicated that Articles (4) and (6) do not contain prohibited acts or omissions that are in themselves suitable for criminalization and punishment, as Article (4) deals with the presumption that the supplier is aware of the nature of the fraudulent goods, while Article (6) regulates the granting of judicial police powers to certain employees.

It added that a review of the original formulation of Article (11) of the Unified GCC Regulation, which was adopted by the Supreme Council of the GCC in its 37th session in the Kingdom of Bahrain in December 2016, revealed that the correct references for penalties include Articles (2), (3), and (5), and paragraphs (a) and (b) of Article (8).

The memorandum further stated that the decree-law is issued to rectify the error in the references in the national text and to align it with the correct text of the Unified Regulation on Combating Commercial Fraud in the GCC States.

Pursuant to the amendment, Article (11) was replaced to include penalties for violating Articles (2), (3), and (5), and paragraphs (a) and (b) of Article (8), while excluding the references to Articles (4) and (6).

The decree-law stipulates that it shall take effect from the date of its publication in the official gazette, and that ministers shall implement its provisions, each within their respective areas of responsibility.