A Saudi Government committee has fined several rice importers SAR40 million ($10.67m) after they were found to have colluded to reduce the weight of rice packets and hike prices, it was reported.
It comes amid accusations that some rice importers were also draining the market of rice stocks to bolster returns.
Minister of Commerce and Industry Tawfiq Al Rabiah, who is also chairman of the Council of Competition Protection (CCP), said a committee investigating the matter found rice merchants had mutually agreed to reduce the weight of rice packets and hike prices.
According to Article 12 of the Competition Law, a fine of up to SR5 million ($1.33m) will be imposed for each violation.
It will be doubled in the case of repeat offences, with details of the verdict publicised at the expense of the violator.
Al Rabiah said the law was aimed at ensuring fair competition by compelling traders and importers to curb practices that monopolised the market, he said.
Muhammad Al Qassem, Secretary General of the Council, said it had been noted rice importers were draining the market of rice stocks and before increasing prices.
“These companies informed their customers about the new hike without notifying them or explaining the reasons for increasing prices,” he was quoted by the Saudi Gazette as saying.
The rice importers can appeal against their penalties to the Court of Grievances, the Ministry of Commerce said in a statement.
The Council will publish their names after a final verdict.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.