An online store owner in Jeddah sells “first copy” watches with the logo of an international brand for SAR 350 each, and writes in the advert that they are copies. He receives a letter from the brand's agent demanding that he stop selling and pay compensation. Is he really at risk?
Yes. Knowingly selling goods that carry a counterfeit registered trademark is a crime under the GCC Trademark Law, which applies in Saudi Arabia. The penalty is imprisonment from one month to one year and a fine from SAR 1,000 to SAR 100,000, or one of them. A person who copies the trademark itself or puts it on goods in bad faith faces up to three years in prison and a fine of up to SAR 1 million. Writing “copy” or “replica” does not make the sale lawful.
What is the difference between trademark counterfeiting and commercial fraud?
A counterfeit product may fall under more than one law. If the problem is the use of a logo or brand name registered to someone else, that is trademark infringement, governed by the GCC Trademark Law issued by Royal Decree M/51 dated 26/7/1435H. If the product itself is fraudulent in its ingredients or origin, or does not meet the specifications, the Anti-Commercial Fraud Law may also apply. A watch with the logo of a brand you do not own may infringe the trademark even if its quality is good. It may also be commercial fraud if it is sold as original.
What is the penalty for counterfeit products in Saudi Arabia?
Article 42 of the GCC Trademark Law separates those who make the counterfeit from those who trade in it:
| Act | Penalty |
|---|---|
| Forging a registered trademark or imitating it in a way that misleads the public, using a counterfeit trademark in bad faith, or putting another person's trademark on goods in bad faith (Article 42(a)) | Imprisonment from 1 month to 3 years and a fine from SAR 5,000 to SAR 1 million, or one of them |
| Knowingly selling, offering or holding for sale goods with a counterfeit trademark (Article 42(b)(1)) | Imprisonment from 1 month to 1 year and a fine from SAR 1,000 to SAR 100,000, or one of them |
| Holding tools or materials for counterfeiting registered or well-known trademarks (Article 42(b)(5)) | The same penalty as paragraph (b) |
| Repeat offence within 3 years of the final judgment (Article 43) | Up to double the maximum, with closure of the shop from 15 days to 6 months and publication of the judgment at the offender's expense |
These penalties do not prevent a harsher penalty under another law, such as the Anti-Commercial Fraud Law, whose fine reaches SAR 500,000, or SAR 1 million in aggravated cases.
What are the rights of the trademark owner?
The owner of a registered trademark does not have to wait until the end of the case to stop the harm. Article 40 gives him the right to ask the competent court for an order on petition (amr ala aridah) for precautionary measures. These include a detailed description of the infringement and preservation of evidence, seizure of the goods, tools and proceeds, preventing the goods from entering the market, and stopping the infringement. The court decides the petition within ten days except in exceptional cases, and it may order the measure without summoning the other party if evidence may be lost. After the order is issued, the main case must be filed within twenty days; otherwise the order is cancelled at the request of the other party.
- Compensation for direct harm, including the profits the infringer made, or a suitable compensation instead if the counterfeiting was deliberate (Article 41).
- An order requiring the infringer to disclose his sources, distribution channels and the people who took part with him.
- Destruction of the counterfeit goods without any compensation to the defendant. Removing the logo is not enough to release them.
- A request to suspend customs release of counterfeit shipments before they enter the country (Article 38).
Claims and violations arising from intellectual property laws fall under the Commercial Court under Article 16 of the Commercial Courts Law. The right holder can also report the infringement to the Saudi Authority for Intellectual Property (SAIP), especially when goods are sold through websites and online stores.
A store in Riyadh offered 200 bags with the logo of a registered brand at SAR 180 each, and it was proved that they were counterfeit.
The brand owner asked for a precautionary seizure and the order was issued. He then filed his case within twenty days and claimed the profits the store made.
The court may order the bags destroyed without compensation, and order compensation based on the value of the original product or the profits made. This is separate from the criminal case against the seller if it is proved that he knew.
How should a seller respond if accused of selling a counterfeit product?
The trading offence in Article 42(b)(1) requires that the seller knew the trademark was counterfeit. So the defence starts with documents: an invoice from an authorised distributor, a letter from the agent, or proof that the goods were put on the market by the trademark owner or with his consent. But a very low price and describing the product as a “copy” make it hard to claim you did not know. If the goods really are counterfeit, stop offering them immediately. Do not destroy them or change their packaging after the warning arrives, because this will be read against you.
If the trademark owner took precautionary measures in bad faith and then did not file his case on time, or lost it, the person whose goods were seized may claim compensation from him within ninety days under Article 44.
I bought a product as original and it turned out to be fake
A buyer is not punished for buying goods for personal use. His right is against the seller: if the goods were sold to you as original, you can claim a refund under the Anti-Commercial Fraud Law and the Civil Transactions Law. Keep the invoice and a screenshot of the advert, ask the seller for proof of where the goods came from, and report it if he refuses.
This is general information based on the official Arabic texts of Saudi laws, which prevail over any translation. It is not legal advice for your specific case.
Practical solutions for both sides
If you are the trademark owner or its agent:
- Make sure your trademark is registered in Saudi Arabia for the class of goods concerned before taking any step.
- Document the infringement with a recorded test purchase, clear photos and dates, without tampering with the sample.
- Ask for a precautionary seizure early, then file the case within the twenty days.
- Calculate compensation on a clear basis: the infringer's profits or the retail price of the original product.
If you are the seller or supplier:
- Keep purchase invoices from authorised sources and the agent's correspondence for every batch.
- Avoid words like “copy” and “master copy” in your adverts. They are an admission that you knew.
- Stop offering the batch concerned as soon as a serious warning arrives, and keep the stock as it is.
- Claim against your supplier if he sold the goods to you as original.
If you have received a warning from a trademark owner, or found copies of your products on the market, send us photos of the product and the registration certificate or invoices on WhatsApp, and we will look at the right next step with you before the deadlines pass.
Need advice on your own case?
Every case turns on its own facts and documents. Send us a short summary and we'll arrange a session with a licensed Saudi lawyer who will tell you clearly where you stand.
Frequently asked questions
Is selling copy brands illegal in Saudi Arabia even if I say they are copies?
Yes, it is punishable. Article 42(b) punishes anyone who knowingly sells or offers goods with a counterfeit trademark. Writing “copy” is evidence that you knew, not a licence to sell.
What is the fine for selling counterfeit products?
From SAR 1,000 to SAR 100,000 and imprisonment from one month to one year, or one of them. It rises to SAR 1 million and three years for anyone who copies the trademark or puts it on goods in bad faith.
Is the buyer punished for buying a counterfeit product?
Not for buying for personal use. The penalty is for selling, offering and holding for sale. The buyer can claim against the seller if the goods were sold as original.
How long does a precautionary seizure of counterfeit goods take?
The court decides the petition within ten days except in exceptional cases. The main case must be filed within twenty days of the order, or it is cancelled at the request of the other party.
General information, not legal advice. The official Arabic texts of Saudi laws prevail over any translation. Disclaimer