Article 4 of the Saudi Competition Law
المادة 4 من نظام المنافسة
The article provides that prices of goods and services are subject to market rules and free competition, except those priced by a Council of Ministers decision or under a law.
Official text (Arabic)
This article has not been amended since the law was issued.
تكون أسعار السلع والخدمات وفقاً لقواعد السوق ومبادئ المنافسة الحرة، عدا أسعار السلع والخدمات التي تحدد بناءً على قرار من مجلس الوزراء، أو بموجب نظام.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 4 explained in plain English
This article sets the general rule on pricing: prices of goods and services are determined according to market rules and the principles of free competition, that is, by supply and demand and competition among establishments, not by a decision of an administrative body.
The text excludes only two cases:
- Goods and services whose prices are set based on a decision of the Council of Ministers.
- Goods and services whose prices are set under a law.
In any other case, prices remain free. But freedom of pricing does not mean agreements among establishments on prices are permitted; Article 5 prohibits practices and agreements among establishments that aim to undermine competition or result in doing so, including fixing or suggesting the prices of goods and fees for services. A free price is one that each establishment sets independently under competition, not one agreed among competitors.
This is connected to the scope of application in Article 3, which makes the Law apply to all establishments inside the Kingdom.
If you want to know whether a particular good is subject to pricing set by a decision or a law, it is advisable to refer to the relevant decision or law or consult a lawyer specialized in competition and commercial cases.
Practical example
A bakery owner in Dammam wants to raise the price of a type of pastry after his costs went up. This article makes the price subject to market rules and free competition unless it is set by a Council of Ministers decision or a law, but he may not agree with neighboring bakeries on a uniform price because that falls within the prohibitions of Article 5.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 4 of the Saudi Competition Law
Are prices free in Saudi Arabia?
The rule is that prices of goods and services follow market rules and the principles of free competition, except those whose price is set by a Council of Ministers decision or under a law.
May merchants agree on a uniform price?
Freedom of pricing does not include agreements among establishments; Article 5 prohibits agreements that fix or suggest the prices of goods and fees for services if their purpose or effect is to undermine competition.
More articles on General Provisions of the Competition Law
- Article 1
The article defines the key terms of the Competition Law, such as establishment, market, dominant position, economic concentration, the Authority and the Committee.
يقصد بالمصطلحات الآتية -أينما وردت في هذا النظام- المعاني المبينة أمام كل منها، ما لم يقتض السياق غير ذلك: النظام: نظام المنافسة. الهيئة: الهيئة العامة للمنافسة
- Article 2
The article explains that the Competition Law aims to protect and encourage fair competition and combat monopolistic practices, in order to improve the market environment and develop the economy.
يهدف النظام إلى حماية المنافسة الــعادلة وتشجيعها، ومكافحة ومنع الممارسات الاحتكارية التي تؤثر على المنافسة المشروعة أو على مصلحة المستهلك؛ بما يؤدي إلى تحسين ب
- Article 3
The article sets the scope of the Competition Law as establishments inside the Kingdom and external practices affecting it, excludes exclusively authorized government bodies, and makes the Authority the primary competent body.
1- مع عدم الاخلال بما ورد في الأنظمة الأخرى, تطبق أحكام النظام على ما يأتي: أ- جميع المنشآت داخل المملكة. ب- الممارسات التي تقع خارج المملكة, ذات الأثر المخل با
- Article 26
The article provides that the current Competition Law replaces the previous Competition Law issued by Royal Decree No. M/25 dated 4/5/1425 AH.
يحل النظام محل نظام المنافسة، الصادر بالمرسوم الملكي رقم (م / 25) وتاريخ 4 / 5 / 1425هـ.
- Article 27
The article requires the Authority's Board to issue the Implementing Regulations of the Competition Law within 180 days of the Law's publication in the Official Gazette, to take effect from the date the Law takes effect.
يصدر المجلس اللائحة خلال (مائة وثمانين) يوماً من تاريخ نشر النظام في الجريدة الرسمية، ويعمل بها من تاريخ نفاذه.
- Article 28
The article provides that the Competition Law takes effect 180 days after the date of its publication in the Official Gazette.
يُعمَل بهذا النظام بعد (مائة وثمانين) يوماً من تاريخ نشره في الجريدة الرسمية.
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.