• A non-Saudi person, whether natural or legal, may not operate as a commercial agent in the Kingdom. Saudi companies operating as commercial agents must have a 100% Saudi capital, and the members of their boards of directors and authorized signatories shall be Saudis.

• Commercial agents who are engaged in business on the date of issuance of this Law and who are not subject to the provisions of Article 1 of this Law shall be given a period of not more than two years from the date this law enters into force to liquidate and transfer their businesses to Saudi commercial agents. The Minister of Commerce and Industry shall specify such period for each agent separately, taking into consideration the time for liquidation, the nature of the business, and the above-mentioned period.

• A person may not operate as a commercial agent unless his name is registered with the Ministry of Commerce and Industry in a register designated for this purpose; said register shall be established pursuant to a decision by the Minister of Commerce and Industry. The register shall include the name of merchant or company, type of goods, name of the authorizing company or establishment, date of authorization, and, if definite, term of authorization. Registration applications shall be submitted together with supporting documents to the Deputy Minister of Commerce and Industry. Such applications may not be rejected except for non-Saudis or for Saudis who are unqualified or barred from engaging in business. Rejected applicants may appeal before the Minister of Commerce and Industry.

Anyone who violates the provisions of this law and its executive regulations shall be punished with a fine of no less than five thousand riyals and no more than fifty thousand riyals, with the penalty being published at the expense of the violator, without prejudice to the right of anyone who has suffered damage from the violation to claim compensation.
If the violation is attributed to a foreigner or to a Saudi company that has one or more non-Saudi partners, the penalty, in addition to the fine, shall include the administrative liquidation of the business, with the possibility of permanently prohibiting the practice of trade or for a specified period. The Minister of Interior may order the deportation of the foreigner from the country in light of the imposed penalty, and the Ministry of Commerce shall notify him about the foreigner or the non-Saudi partner.

The registration fees in the Agencies Register are determined as follows:
Five hundred Riyals for individual traders and companies.
The fees are paid once.

1 – A committee shall be formed in the Ministry of Commerce by a decision of its Minister consisting of three members to implement the penalties stipulated in the Commercial Agencies Law and the Weights and Measures Law.
2 – An appeal may be filed against the decisions of this committee before the Minister of Commerce within fifteen days from the date of notifying the appellant or their representative; otherwise, its decisions shall become final after the mentioned period and upon the ratification of the Minister of Commerce.

Without prejudice to any other regulations, the Commercial Agencies System issued by Royal Decree No. (11) dated 20/2/1382 AH, and its amendments, shall apply to anyone who contracts with the producer or their representative in their country to carry out commercial activities, whether as an agent or distributor in any form of agency or distribution.

Without prejudice to the regulations and decisions related to the provision of maintenance and spare parts, the agent and distributor are committed to the following:-
A) To continuously secure the spare parts that consumers typically request on an ongoing basis for the products subject to the agency and to secure other spare parts within a reasonable time frame, in accordance with the executive regulations.
B) To provide the necessary maintenance for the products and to guarantee the quality of manufacturing and the conditions usually set by the producers continuously throughout the duration of the agency and for one year following the expiration date or the date of appointing a new agent, whichever comes first, in accordance with the executive regulations.

The Minister of Commerce issues the Implementing Regulation for the Commercial Agencies System and publishes it in the Official Gazette.

The Ministry of Commerce prepares contract templates that serve as a guide for agents and distributors, including all the essential data of the contract such as the parties to the contract, its subject matter, its temporal and spatial scope, how it is renewed and terminated, the obligations of both parties to each other, and their obligations towards the consumer, especially regarding the provision of maintenance and spare parts.
Thirdly - The provisions of Article Two of Clause Two of this decree apply to importers even if they are not agents or distributors, and to anyone who has made the sale process, directly or indirectly, their profession for the purpose of profit. Penalties applicable to agents and distributors will be imposed on anyone who violates this article.