- The Capital Market Authority Announces Regulatory Amendments to Simplify the Opening and Operation of Investment Accounts
- The amendments aim to support the regulatory framework for foreign investment in securities and the Financial Market Institutions Regulations.
The Capital Market Authority (CMA) has announced the approval of regulatory amendments aimed at simplifying procedures for opening and operating investment accounts.
These amendments are intended to support the Rules for Qualified Foreign Financial Institutions Investment in Listed Securities as well as the Financial Market Institutions Regulations.
Reasons for Adopting the Amendments
The CMA Board approved a set of regulatory changes designed to streamline the process of opening and operating investment accounts for several categories of investors.
This initiative is part of the broader project to amend the “Investment Accounts Instructions,” the “Rules for Qualified Foreign Financial Institutions Investment in Listed Securities,” and the “Financial Market Institutions Regulations.”
These amendments will take effect as of their date of publication.
This move aims to keep pace with regulatory and technological developments in the Kingdom of Saudi Arabia, facilitate investment in the local capital market by enhancing account opening and management mechanisms, and add new investor categories.
It also seeks to regulate processes related to these accounts in a way that strengthens the attractiveness of the Saudi capital market for both local and international investors, improves investor protection, and boosts market participants’ confidence.
Among the most notable amendments is the development of requirements for opening investment accounts for individual foreign investors (natural persons) residing in Gulf Cooperation Council (GCC) countries, expanding the range of securities they can invest in directly to include stocks listed on the main market.
Previously, this category of investors was only permitted to invest in debt instruments, the Parallel Market “Nomu,” investment funds, and the derivatives market, while their trading in the main market was limited to swap agreements or investment decisions managed on their behalf by authorized financial institutions.
These changes are expected to help attract more foreign investment, increase liquidity in the Saudi capital market, and support the national economy.
The amendments support foreign investors
Additionally, the new amendments will allow individual foreign investors who previously resided in the Kingdom or in any GCC country to continue operating their investment accounts and investing in stocks listed on the main market even after their residency period ends and they return to their home country, provided they had opened an investment account while residing in the Kingdom.
Moreover, the amendments aim to simplify the procedures for opening and operating investment accounts for various categories of financial market institution clients, ensuring a broader investor base and greater investment opportunities.
It is worth noting that the CMA had published the draft of these amendments for public consultation on November 20, 2024, through the National Unified Platform for Public Consultation (Istitlaa platform ) under the National Competitiveness Center, as well as on the CMA’s official website, before approving and issuing them in their final form.
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