Introduction

The Saudi General Authority for Competition (“GAC”) has issued Version 5 of its Economic Concentration Guidelines (February 2025), outlining notification requirements for both local and foreign transactions under GAC’s merger control regime (the “Guidelines“). This updated version provides additional rationale from GAC and refines the rules governing mergers, acquisitions, and joint ventures.

The Guidelines implement GAC’s merger control framework as established by Cabinet Resolution No. 372 of 1440H (promulgating the KSA Competition Law under Royal Decree No. M75 of 1440H) (“Competition Law“) and Resolution No. 337 of 25/1/1441H (concerning the Executive Regulations of the KSA Competition Law) (“Executive Regulations“).

These new Guidelines aim to enhance transparency by continuing the tradition of clarifying and introducing provisions to help both local and foreign companies comply with the Competition Law through proper merger control notification procedures.

Below, we analyze the key differences between version 4 (November 2023) and version 5 of the Guidelines, with particular focus on practical implications for businesses and investors.

Unchanged Aspects:

While the new Guidelines address various business considerations and policy rationales, we note several key aspects remain unchanged from previous versions. These include: (1) the financial filing thresholds before the GAC, particularly the minimum local turnover requirements for parties involved and the Target’s turnover threshold for acquisitions; and (2) the existing notification requirements for joint ventures. However, the 2025 Guidelines introduce new notification measures specifically applicable to new product development initiatives, which we detail in this article.

Tailored Financial Thresholds Per Transaction:

Up until the issuance of the 2025 Guidelines, the financial threshold to notify the GAC of any Economic Concentration,as defined under the Competition Law, is realized by meeting allthree of the following financial thresholds (“Financial Thresholds”):

1. The total worldwide annual salesvalue of Economic Concentration Parties exceeds 200 million Saudi Riyals;
2. The total worldwide annual salesvalue of the target establishment exceeds 40 million Saudi Riyals; AND
3. The total annual sales value in Saudi Arabiaof all Economic Concentration Parties exceeds 40 million Saudi Riyals.

The 2025 Guidelines amend the Financial Thresholds and tailor the Financial Thresholds per transaction (i.e. acquisition, merger, or joint venture) as follows:

We highlight two significant developments in the 2025 Guidelines: First, for acquisitions, they now explicitly require the Target entity to contribute to local Saudi Arabian revenues under the Financial thresholds, a requirement absent from the previous 2023 Guidelines. Second, the Guidelines provide much-needed clarity on applying the Financial Thresholds to mergers and joint ventures, resolving long-standing interpretive questions that had previously been addressed only through GAC practice. We must note that through on our discussions with the GAC, we’ve deduced that even revenues as minimal as 1 Saudi Riyal from the Target would be deemed a contribution to meeting the total annual sales value in Saudi Arabia under the new Financial Thresholds. 

Additional Joint Ventures Rules:

Generally, the rules for notifying joint venture remain in place as the still GAC considers a joint venture a notifiable Economic Concentration if: (i) it operates independently on a lasting basis (a full-function joint venture), and (ii) has its own management, resources, and market presence. If a non-autonomous joint venture later meets these criteria, it must be notified as a new Economic Concentration.

However, the 2025 Guidelines introduce an important qualification for joint ventures established for developing new products/markets (particularly those contributing to foreign investment attraction, industry localization, or knowledge transfer) may qualify for an exemption from notification provided that they meet specific criteria relating to the transaction’s nature, including:

• • 1. The joint venture relates to the manufacture of a product that is not currently produced in Saudi Arabia, or when the product is manufactured in Saudi Arabia but can only be distributed to a limited part of Saudi Arabia for technical reasons inherent in the nature of the product; and
    2. The joint venture consists of partners who are not, individually or together, current or potential competitors of a product.

Required Documents: Removal of The Seller’s Required Documents in Acquisitions & Mergers

In a departure from the 2023 Guidelines requirements, the 2025 Guidelines no longer mandate submission of the Seller’s legalized or apostilled Power of Attorney or Commercial Register as part of the notification application. This modification simplifies the documentation process for transactions. However, the Guidelines leave unresolved whether basic seller information must still be included in the notification application submitted to GAC.

Conclusion

While the 2025 Guidelines do not introduce major reforms compared to the 2023 version, stakeholders should proactively review these updates to effectively navigate Saudi Arabia’s evolving competition landscape. As market conditions continue to develop, maintaining compliance and staying informed remain critical for success in this dynamic and expanding business environment.

How can GLA help?

Leveraging our market-leading Antitrust and Competition practice – recognized as a regional leader – and our strong regulatory relationships, GLA delivers premier legal services. Our team expertly evaluates transactions under competition frameworks and seamlessly guides clients through economic concentration filings. Please contact Alex Saleh, Managing Partner (alex.saleh@glaco.com) and Asad Ahmad, Head of Antitrust and Competition Practice (asad.ahmad@glaco.com) if you have any questions.

Authors:

Asad Ahmad, Legal director – Head of Anti-Trust and Competition

Khaled Al Khashab, Associate