How to Run Discounts Legally in Saudi Arabia — Complete Guide
Running discounts and promotions in Saudi Arabia isn't just about lowering prices — there are strict regulations you must follow. The Saudi Ministry of Commerce actively monitors promotions, especially during peak seasons like White Friday, Ramadan, and Back to School. This guide explains how to run compliant discounts and avoid penalties.
Full guide: Saudi Pricing, Discounts, and Promotions Guide
Saudi Discount Regulations — What You Need to Know
Legal Framework
Discounts and promotions fall under multiple regulations:
- Anti-Commercial Fraud Law — Prohibits misleading advertisements
- E-Commerce Law — Regulates online promotions
- Consumer Protection Law — Protects buyer rights
- Ministry of Commerce Regulations — Sets discount conditions
Core Discount Requirements
| Requirement | Details |
|---|---|
| Original price is genuine | Pre-discount price must be the actual selling price for 30+ days |
| Discount percentage is accurate | Difference between original and sale price matches the stated percentage |
| Duration is specified | Clear start and end dates |
| Availability is guaranteed | Sufficient stock or quantity stated |
| Conditions are clear | Any exceptions or terms written clearly |
Allowed vs. Restricted Promotion Types
Allowed ✅
- Direct price reductions showing the original price
- "Buy one get one free" with clear conditions
- Discount codes with specific coupon
- Licensed seasonal sales
- Free shipping as a promotional offer
- Gift with purchase (with stated value)
Prohibited or Requires Caution ⚠️
- Inflating the original price then "discounting" it (fake pricing)
- Claiming "lowest price" without evidence
- Promotions without an end date
- Discounts without stating terms and exceptions
- Using "up to 90% off" when most items have much lower discounts
- Prize draws without MC license
How to Calculate Discounts Correctly
The Right Formula
Discount % = (Original Price − New Price) ÷ Original Price × 100
| Original | Sale Price | Discount | Correct Display |
|---|---|---|---|
| SAR 200 | SAR 150 | 25% | ~~200~~ → 150 SAR (25% off) |
| SAR 500 | SAR 299 | 40.2% | ~~500~~ → 299 SAR (40% off) |
| SAR 1,000 | SAR 699 | 30.1% | ~~1,000~~ → 699 SAR (30% off) |
Important: All prices must be inclusive of 15% VAT.
Seasonal Sales — Special Rules
Key Saudi Seasons
| Season | Approximate Period | Notes |
|---|---|---|
| Ramadan | Full month | Highest consumption — food & electronics deals |
| Eid Al-Fitr | 2 weeks | Fashion, gifts, electronics |
| Eid Al-Adha | 2 weeks | Supplies, gifts |
| White Friday | November | Biggest digital sale season |
| National Day (Sep 23) | 1 week | Special national offers |
| Back to School | Aug–Sep | School supplies, electronics |
| Founding Day (Feb 22) | 1 week | Special offers |
Contests and Prize Draws — Special Rules
Prize draws and contests in Saudi Arabia require a Ministry of Commerce license:
- Submit an application through the MC platform
- Specify the prize with its actual value
- Define the winning mechanism with full transparency
- Don't require purchase as the only entry condition
- Announce winners publicly
- Deliver prizes within the specified timeframe
Fine: Operating without a license can result in a penalty of up to SAR 500,000.
Common Discount Mistakes
- Fake original price — Inflating price before the sale to show a higher discount
- "While supplies last" — Without specifying actual quantity
- No end date — Violates regulations
- "Up to 70% off" — When most products are only 10% off
- Price excludes VAT — Immediate violation
- Changing terms after publishing without notice
- Discounting expired products without disclosure
Steps to Execute a Legal Discount Campaign
- Select products — Choose which items are included
- Calculate discounts — Verify percentages and prices
- Write terms — Specify duration, quantity, and exceptions
- Legal review — Ensure regulatory compliance
- Create ad materials — Design banners and ads
- Update pricing — Update your store and platforms
- Monitor — Track performance and feedback
- End the promotion — Restore prices when the period ends
FAQ
Do I need a license to run discounts in Saudi Arabia?
Direct price reductions don't require a special license, but prize draws and contests require MC licensing. Major seasonal sales may require prior notification.
What is the fine for fake discounts?
Fines up to SAR 1 million for commercial fraud, plus potential business closure and public naming.
How long can a promotion run?
There's no strict maximum, but it must have a defined duration with clear start and end dates. Open-ended promotions without an end date are considered violations.
Must I show the original price with the discount?
Yes — you must display the original price, sale price, and discount percentage clearly. The original price must be the genuine price at which the product was previously sold.
