Saudi Arabia’s merger control regime has entered a more confident and sophisticated phase. With the issuance of Version 5 of the Economic Concentration Review Guidelines in April 2025, the General Authority for Competition has sharpened its approach to transaction review without changing the underlying Competition Law. The result is a clearer, more predictable framework that places substance firmly ahead of form.
For dealmakers and advisers, the message is direct. Regulatory risk now turns on how control is exercised in practice, how structures operate economically, and how convincingly a transaction’s Saudi nexus can be assessed and defended.
Economic Concentration and Control
A filing obligation under Saudi competition law arises only where an economic concentration occurs. This requires a lasting change of control through an acquisition, a merger, or the creation of a full-function joint venture. The 2025 Guidelines provide much-needed clarity on what constitutes control and how GAC will assess it. Control is no longer viewed narrowly. The Guidelines expressly recognise positive control, negative control, joint control, and de facto control.
De facto control may arise through contractual arrangements, governance rights or economic dependence, even where shareholding levels suggest otherwise. This reflects a more realistic understanding of influence in modern investment structures.GAC also places renewed emphasis on the single economic entity doctrine, particularly in investment funds and holding structures. Rather than focusing solely on the immediate transaction vehicle, GAC will assess control and turnover at the group level. Minority investments and layered structures are therefore subject to closer scrutiny than in earlier years.
Joint Ventures and Full Function Analysis
Joint ventures remain a central focus of the revised Guidelines. Notification is required only when a joint venture qualifies as a full-function entity that operates as an independent, self-standing economic undertaking on a lasting basis. GAC evaluates this using practical indicators. These include independent management and decision-making authority, dedicated asset staff and financing, operational autonomy from parent companies, and the ability to operate in the market beyond serving shareholders. Joint ventures limited to internal coordination, research and development support, or sales functions will generally fall outside the notification regime. Crucially, the Guidelines acknowledge that full functionality can develop over time. A joint venture that is not notifiable at inception may later become notifiable as its activities expand. Periodic reassessment is therefore essential.
Turnover Thresholds and Jurisdiction
Even where an economic concentration exists, notification is required only if all financial thresholds are met. These include combined worldwide turnover exceeding SAR 200 million, certain parties exceeding SAR 40 million in global turnover depending on the transaction type and combined annual turnover in Saudi Arabia exceeding SAR 40 million.
The application of these thresholds differs across acquisitions, mergers, and joint ventures. In acquisition cases, the Guidelines clarify that Saudi turnover at the target level is critical. Global turnover alone will not establish jurisdiction where the target lacks a genuine Saudi nexus. This clarification is particularly relevant for cross-border transactions involving multinational groups with limited operations in the Kingdom.
Full Notification and No Notification Filings
One of the most practical developments in the 2025 Guidelines is the clearer treatment of no notification filings. These are not exceptions and not procedural shortcuts. They are tools used to obtain regulatory certainty where notification may be arguable. In practice, no notification filings are commonly used where financial thresholds are technically met, but the target lacks meaningful competitive presence in Saudi Arabia, or where control could arguably be inferred due to governance rights vetoes or historical relationships, despite the parties’ position that no change of control arises. In such cases, parties submit a focused filing explaining why the transaction does not constitute an economic concentration or why GAC lacks jurisdiction despite the thresholds being met. The objective is certainty rather than clearance, particularly important given GAC’s power to investigate transactions after closing and unwind agreements if notification should have been made.
Market Definition and Competitive Assessment
Market definition remains central to GAC’s analysis. Relevant products and geographic markets are assessed based on demand- and supply-side substitutability, functional levels of trade, and potential competition. This analysis is equally important in no-notification contexts, where demonstrating the absence of competitive effects in Saudi Arabia often turns on rigorous market definition and credible economic evidence.
Targeted Exemptions
The Guidelines introduce a targeted exemption for joint ventures established to manufacture products not currently produced in Saudi Arabia, provided the parent companies are neither actual nor potential competitors. This reflects a pragmatic policy choice to encourage industrial investment while maintaining effective oversight of competition.
A More Demanding Merger Control Environment
The 2025 Guidelines mark a clear turning point in Saudi merger control. The key question is no longer whether a transaction appears notifiable on paper, but whether the decision to notify or not to notify can be supported by evidence and analysis.
Joint ventures, minority investments, and transactions with limited Saudi nexus now require early, careful assessment. In many cases, thoughtful engagement with GAC through no notification submissions will be as important as formal filings. Merger control in Saudi Arabia has become a strategic component of deal execution rather than a procedural formality.