GAC updates guidelines for economic concentration examination

Logo of The General Authority for Competition (GAC) 

The General Authority for Competition (GAC) updated the guidelines for examining economic concentration, it announced today, April 9.

The key amendments the guidelines include controls for examining joint ventures (JVs) in new markets and products, GAC said on X platform.

Such JVs are not subject to reporting if they relate to manufacture of a product that is not produced in Saudi Arabia or, if produced in the Kingdom, faces limited distribution due to inherent technical reasons related to the nature of the product.

In addition, the JV will not require notification if it consists of partners who are not considered, whether individually or collectively, as current or potential competitors in the market.

The guidelines also include “Reporting Economic Concentration by Investment Funds", establishing controls for examining concentration levels within investment funds. Such transactions will not require notification if the sole purpose of the acquisition is to acquire shares in other entities without directly or indirectly intervening in the management of those entities.

Therefore, control will not be used to influence the entity's behavior in the market, and it will only be used to preserve the value of the investment.

Moreover, no notification is needed if the investment fund does not hold a controlling stake in any companies that are competitors of the target company, according to the definition of the relevant market.