Saudi Arabia Files Charges against Automobile Establishments, Showrooms for Violating Competition Law

A vehicle showroom in Saudi Arabia (Asharq Al-Awsat)
A vehicle showroom in Saudi Arabia (Asharq Al-Awsat)
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Saudi Arabia Files Charges against Automobile Establishments, Showrooms for Violating Competition Law

A vehicle showroom in Saudi Arabia (Asharq Al-Awsat)
A vehicle showroom in Saudi Arabia (Asharq Al-Awsat)

The Board of Directors of the General Authority for Competition (GAC) has given the green light to file charges against 79 establishments for violating the Competition Law and its executive regulations.

The board decided to initiate criminal cases against 64 establishments and study settlement requests by the remaining 15 entities.

Violations included agreeing to fix prices and dividing markets according to geographic regions, which led to reducing competition and affecting the interests of consumers.

On Wednesday, the GAC Board of Directors held its 85th meeting in Riyadh, during which it decided to initiate criminal proceedings against a number of establishments and study settlement requests for others in several sectors.

The board reviewed the results of a survey in the education and industry sectors, and agreed to implement the necessary measures against six establishments and ordering them to correct their conditions. It also approved settlement requests submitted by two establishments that provide cold and hot drinks and pastries, after reviewing the results of the study and investigation.

The board also examined the results of the study and investigation with 10 institutions operating in the field of contracting, and decided to dismiss the cases against them for lack of jurisdiction.

Moreover, the board reviewed the results of an inquiry pertaining to an establishment operating in the waste collection and transportation sector, and decided to close the case because it was not found to be in violation of the Competition Law and its executive regulations.

Similarly, results of a study concerning five companies operating in the retail sales and electronic devices sector, led to closing the case after it was not found to be in violation of the Competition Law and its executive regulations.



Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
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Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)

Saudi Arabia’s digital advertising sector is experiencing rapid growth, but a significant portion of its revenues is leaking to foreign platforms. To maximize the impact on the national economy, experts are calling for strategies to curb this outflow and redirect it to local channels.

The importance of retaining digital ad revenues lies in the substantial size of this market. It is estimated that approximately $1 billion in ad spent is lost annually to foreign platforms, representing a considerable loss to Saudi Arabia’s economy.

Dr. Ebada Al-Abbad, CEO of Marketing and Communications at Tadafuq, a Saudi digital advertising network, told Asharq Al-Awsat that the problem stems from the fact that although advertisers, products, and audiences are often local, the largest share of financial gains goes to foreign platforms. He estimated that 70-80% of the $1.5 billion spent on digital advertising in Saudi Arabia in 2022 went to global platforms such as Google and Facebook. This results in the national economy losing nearly $1 billion annually from this sector alone.

Al-Abbad noted that government agencies in Saudi Arabia also contribute to the outflow. He explained that public sector spending on digital advertising, intended to raise awareness among citizens and residents, frequently ends up on foreign platforms. Government spending makes up about 20-25% of the total digital ad market in the Kingdom, meaning hundreds of millions of riyals leave the country annually, weakening the local digital economy.

Al-Abbad argues that Saudi Arabia needs strong local digital ad networks to keep this revenue within the national economy. These networks would help create jobs, drive innovation, and promote cultural diversity in digital content. Developing local platforms would also enhance Saudi Arabia’s digital sovereignty by ensuring that data remains within the country and is not controlled by foreign entities.

Moreover, local networks would reduce dependence on international platforms, ensuring that the economic benefits of digital advertising remain in the Kingdom, he said, stressing that this would align with Saudi Arabia’s broader Vision 2030 goals, which emphasize building a robust, diversified economy driven by local industries and digital transformation.

Globally, the digital advertising sector is growing rapidly. In 2022, worldwide spending on digital ads reached $602 billion, and it is projected to hit $876 billion by 2026. In the Middle East and North Africa (MENA) region, the digital ad market grew to $5.9 billion in 2022, with Saudi Arabia’s market accounting for over $1.5 billion.

In other countries, the digital ad sector plays a crucial role in boosting national economies. For example, in the United States, the digital advertising industry contributed $460 billion to the GDP in 2021, about 2.1% of the total. In the UK, the sector accounted for 1.8% of GDP in 2022. This shows how important digital advertising can be in driving economic growth.

One of the key challenges facing Saudi Arabia’s digital ad sector is the dominance of global platforms like Google and Facebook, which control 60% of the global digital ad market, Al-Abbad told Asharq Al-Awsat. This dominance results in a significant outflow of revenue and allows these platforms to control digital data and content. He warned that this could undermine Saudi Arabia’s national sovereignty over its digital economy.

To counter this, he emphasized that Saudi Arabia needs to build competitive local networks that can retain a larger share of the market. This will not only keep more revenue in the country but also strengthen the Kingdom’s control over its digital data and content.