Written by Consultant / Abdul Haleem Ammar

Concept of Commercial Concealment:-    

The person who enables any non-Saudi to invest in any restricted activity, or to practice any prohibited activity, whether by using his name, license, commercial register or other ways, is considered to commit an act of concealment. 

Firstly – The Competent Authorities of Execution of These Violations:-

• Ministry of Commerce & Industry
• The Ministry of Commerce & Industry is concerned with investigation and inspections of violations and receipt of notifications and control such violations.
• The Minister of Commerce & Industry issues a resolution naming the officers authorized as a Control Officers, including regulations and restrictions of selecting them and procedures that should be adhered to while performing their duties.
• The Bureau of Investigation & Public Prosecution

The regulations have authorized investigation duties concerning violations of these regulations to the Bureau of Investigation & Public Prosecution.

• Board of Grievance

This is concerned with consideration and settlement of violations of these regulations.

Secondly- Penalties:  

1. Without violation of any other intensive penalty stipulated for in any other regulations, the violator of the 1^st Article of these regulations is sentenced to prison for a period not more than 2 years, and a fine not more than 2 Million Saudi Riyal, or one thereof.
2. Penalties stipulated for in the previous paragraph, differ under different violators, shops and establishment in which such violations has been practiced.
3. The Penalty Resolution is to be published in one of the national newspaper on the account of the violator.
4. The Bureau of Investigation & Public Prosecution has the right to claim preventing travel those who are verified to be involved in a cover-up process till issuance of a final judgment in such case, and in case a condemnation rule is issued as for the non-Saudi, he will be deported home, after executing judgment, and payment of all due taxes and charges and all other dues, and he is not allowed to work again in KSA.

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5. The commercial register, or the branch register related to the violated shop, and the license as well will be cancelled, in addition to terminate all labors of such violated activity, and prevention from practicing activity for a period not more than 5 years.
6. All Zakat, taxes, charges will be paid jointly between Conniver and the beneficiary, in addition to any other obligations not paid due to connivance.
7. Without violation of any other intensive penalty that could be stipulated for in another regulations, a penalty of SR 100,000 , only One hundred Thousand Saudi Riyals is to be applied for those who  anyhow whatever, prevent or hinder the authorized officers to perform their duties.

Fourthly- Vexatious or Malicious Notification:  

Without violation of any other intensive penalty stipulated for in any other regulations, the person who intentionally notifies incorrect act of concealment will be judged under law by the competent court for a sentence, and the plaintiff is allowed to claim for compensations against damages occurred.

Fifthly- A Reward for Those who notifies an Act of Concealment:  

Under a Resolution by the Minister of Commerce & Industry, a reward not more than 30% out of the sentenced penalties will be awarded to those notified about an act of concealment only under a proof to commence investigations, and after the final judgment, and in case of several persons, such reward is to be equally divided. 

Sixthly- Proves of Performing illegal Commercial Activity:  

We find, under evidences from some judgments issued by the Board of Grievance, that it was mentioned in the recitals of the Rule No: – ج/245, Case No: – ق/5/260 for 1427H, that the following are evidences of Concealment: – 

1. Existence of a commercial partnership contract between the Saudi and the expatriate.
2. Absence of the (Saudi) Defendant abroad and from the head office of the company for a long period.
3. Dealing of the (Foreigner) expatriate directly with traders in terms of goods purchase and payment of debts.
4. Existence of a PAO from the Saudi authorizing the expatriate to receive and payment of amounts.