Approval of E-Commerce Law to spur Saudi economic growth


JEDDAH, (DNA)  — The Electronic Commerce Law, approved by the Council of Ministers on Tuesday, aims to enhance the reliability of e-commerce in the Kingdom so as to increase its contribution to the national economy to achieve the goals of the Kingdom’s Vision 2030 and stimulate and boosts e-commerce activities in the Kingdom.This is a first of its kind code in the Kingdom to regulate the relationship between consumers and those e-commerce practitioners who do not have a commercial registration.

The Cabinet approved the law after examining the two decisions of the Shoura Council and recommendation of the Council of Economic and Development Affairs (CEDA) following the presentation of a report by the Ministry of Commerce and Investment.

The Cabinet also endorsed amendment in the Public Transport Authority Law to change the name of “Public Transport Authority” to the “General Authority for Transport.”

Minister of Commerce and Investment Majed Al-Qasabi thanked Custodian of the Two Holy Mosques King Salman and Crown Prince Muhammad Bin Salman on the occasion of the Cabinet’s approval of the E-Commerce Law.

Al-Qasabi said that the e-commerce law is a new historical phase in the national economy that enhances its position and its ability to cope with all the changes and modern trading patterns in the world.

“The law aims to enhance the reliability of business transactions, stimulate and develop e-commerce activities and protect all rights of consumers and safeguard them from fraud, deception and misleading.”

Al-Qasabi stressed the importance of e-commerce and its role in strengthening the national economy in light of the robust growth witnessed by the Kingdom. “Strengthening the e-commerce system is one of the most important objectives of the National Transformation Program in support to achieve the Vision 2030,” he said, while pointing out that the wise leadership has paid great attention to this vital sector.

E-commerce is a promising global market worth more than $ 30 trillion. The Kingdom is one of the top 10 countries in the world in terms of e-commerce growth rate that exceeds 32 percent annually. The volume of e-trade in the Kingdom reached SR80 billion in 2018, with an increase of average online spending per capita to SR4,000.

The Council of Ministers approved earlier the establishment of an E-Commerce Board comprising a number of government and private sector representatives, which are implementing 39 initiatives supporting e-commerce in the Kingdom.

The e-commerce law regulates the relationship between shoppers and electronic stores, and allows people, who do not have a commercial registration to practice business activity and deliver goods and services to consumers, to do it in accordance with some specific regulations.

The law requires service providers to disclose data of their trade, goods and services to consumers, set conditions to be observed during the conclusion of electronic contracts that guarantee the rights of all members of the purchasing process, protect personal data of the consumer, regulate the consumer’s right to retrieve goods, addresses delay in delivery of products and services, and regulates and intensifies censorship of the e-commerce advertising market to prevent fraud and deception.

The law also enhances the role of department store registries and digital platforms that act as intermediaries between the service provider and the online shopper.

The Ministry of Commerce and Investment said that the law consists of 26 articles that provide the necessary protection for e-commerce transactions from fraud and deception in a manner that preserves the rights of both the trader and the electronic shopper.

E-commerce is an open market, 24 hours a day, providing time and effort to the shopper to access all goods and services with various options in a transparent and competitive environment.

According to the new law, the right of the consumer to return the product or service shall be within seven days in the event of not using or benefitting from it except for certain circumstances specified in the law.

It gives the consumer the right to cancel the purchasing process if the service provider delayed delivery for more than 15 days. The law regulates the electronic advertising market to protect consumers from infringing or misleading advertisement.

The law specifies that those e-commerce practitioners who do not have a commercial registration need to identify their place of business, clarify their data through the online store to ensure the protection of consumer data and privacy, and to document their business through one of the electronic store documentation platforms.

The law stipulates the formation of one or more committees to consider violations of the provisions of the law or its executive regulations and punish the violator with one or more of the following penalties: warning; stopping the activity temporarily or permanently; blocking the Internet service partially or completely; and slapping fines amounting up to SR1 million.