SAUDI ARABIA Law and Practice Contributed by: Alex Saleh, Asad Ahmad, Khaled al-Khashab and Shahad Al-Humaidani, GLA & Company
3.6 Penalties/Consequences of Incomplete Notification
those sectors and markets (the GAC can discuss the contents of the Economic Report with the notifying parties and pro - vide a brief template, upon request, plus any other data, information or documents required by the GAC to review the eco - nomic concentration. • A full explanation of these submitted docu - ments. For the acquiring entity/merging entity/first part - ner in the joint venture: • validated power of attorney (POA) by the Min - istry of Justice/Saudi Arabian Embassy/Saudi Arabian Consulate/Apostilled; • articles of association; • commercial register; and • financial statements for the last financial year (the “LFY”). For the target entity/merged entity/second part - ner in the joint venture: • validated POA by the Ministry of Justice/ Saudi Arabian Embassy/Saudi Arabian Con - sulate/Apostilled; • articles of association; • commercial register; and • financial statements for the LFY. For the seller: • validated POA by the Ministry of Justice/ Saudi Arabian Embassy/Saudi Arabian Con - sulate/Apostilled; • commercial register; and • the official contact persons for the economic concentration parties and any relevant third parties specified in the submission.
If notification is made without all the requisite documents being provided, the GAC reserves the right to close the notification file. The GAC’s annual reports for 2019 to 2022 reveal that only one application was rejected in 2021 due to an incomplete notification application. This is in contrast to 2020 and 2019, when there were no rejected applications. However, in 2022, one application was rejected due to potential effi - ciencies from the transaction involved in the concentration parties’ view, which could be realised without the transaction consummating. In addition, it was determined that the potential harms to competition outweighed the benefits anticipated if the transaction were completed. 3.7 Penalties/Consequences of Inaccurate or Misleading Information Under Article 49 of the Executive Regulations, if the notifying party is found to have withheld information, provided misleading information or concealed or destroyed documents that are use - ful to the GAC’s investigation, they will be fined up to 5% of the total annual sales turnover or SAR5 million where it is impossible to estimate the annual sales. 3.8 Review Process The economic concentration must be notified to the GAC at least 90 days before the completion of the economic concentration. The applicant’s notification submission will be considered to be complete when they have satisfied the condi - tions required for notification, including provid - ing the information required and documents necessary for complete notification. The 90-day regulatory review period will begin on the date on which the GAC informs the applicant that their notification submission is complete.
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