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Saudi Ministry Penalises Firms Organising Lottery Retail Prize Draws to Promote Sales
The Saudi Ministry of Commerce has initiated punitive measures against several commercial establishments and individuals found organising lottery retail prize draws for commercial goods.
These draws required consumers to make purchases as a prerequisite to participating in the contest. The ministry has summoned the offending commercial entities and individuals to undergo legal proceedings before referring their cases to the Public Prosecution.
The ministry has emphasised that commercial establishments and individuals must refrain from coercing consumers into making purchases as a condition for participating in contests, offers and raffles organised by them. This includes practices such as placing contest vouchers within items or inflating the price of goods during contests.
It has underscored that any form of payment or requirement for consumers to make purchases in exchange for participation in contests constitutes lottery activity, which is strictly prohibited under the Kingdom's regulations.
Lottery prizes that hinge on purchasing goods or products in exchange for cash prizes, entry into prize draws, or the inclusion of cash within products offered for sale to consumers are expressly forbidden in the Kingdom.
According to the Anti-Commercial Fraud Law and its Executive Regulations, requiring purchases in commercial competitions as a condition for participation is prohibited. Furthermore, competitions must adhere to the principles of Shariah law and customs observed in the Kingdom.
The ministry has declared its commitment to ramping up monitoring efforts to ensure that commercial establishments and advertisers licensed by the General Authority for Media Regulation comply with the regulations for organising commercial competitions as outlined in the Anti-Commercial Fraud Law and its Executive Regulations.
It has also mandated that no commercial contests be organised or advertised without obtaining the necessary licence.
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