Saudi Arabia passes new anti-concealment law, including protection of whistleblowers

The law, which was initially passed by the Kingdom’s Shura Council earlier last month, was passed and approved by the Council of Ministers.

The Kingdom’s new anti-concealment law, approved by the Council of Ministers at its meeting on Tuesday; includes heavy penalties of jail time and fines, as well as protection of whistleblowers, the ministry of commerce has said.

The new law stipulates up to five years in jail and fines of SR5mn for the violators.

The law, initially passed by the Kingdom’s Shoura (Consultative) Council last month, enacted to “contribute to restricting the sources of concealment and eliminating the shadow economy,” according to the ministry of commerce.

The law establishes new mechanisms that will allow for the protection the identity and data of whistleblowers in concealment cases; by not including them in the case files. Besides, rewarding whistleblowers with a percentage of up to 30 percent of the fine collected after issuing the verdict and gaining final status.

Proactive measures

“The system stipulated proactive measures to prevent the occurrence of cover-up crimes to narrow the sources of this phenomenon by addressing the stages preceding the crime, and punishments, the most important of which is the seizure and confiscation of illegal funds for the perpetrators of the crime after final court rulings have been issued against them,” the ministry said in a statement carried by the SPA.

Earlier this week; the government established a ministerial committee to combat commercial fraud and to develop solutions to eliminate the practice.

The committee will take aim at activities; such as foreign nationals owning businesses in the Kingdom while using the names of Saudi citizens.

There will be advanced levels of coordination among authorities issuing business licenses and manpower visas.

The Saudi Data and Artificial Intelligence Authority will build an index to measure the percentage of suspected cases of commercial cover-ups. Besides, keep updating the records based on the data it receives from the authorities.

The system enables the relevant government agencies to curb business licensing fraud or cover-up crimes; demanding that each entity that issues licenses to businesses follow up on them. In addition to inform the ministry of commerce of any suspicious practices.

The new system authorizes relevant entities to use technology to prove the crimes and violations of the commercial concealment. This is through “electronic evidence” in addition to other methods of proof.

The system also allows commuting or exempting from penalties for those who report any fraudulent activities.

The new anti-cover-up system contributes to encouraging small and medium enterprises and protecting consumers from the negative effects of concealment.

The ministry of commerce has the mandate to control businesses; receive reports and control crimes and violations stipulated in the system.