Saudi Arabia’s Capital Market Authority (CMA) Board has approved changes to rules that regulate what type of foreign investor can enter into the Saudi stock market.
The changes include 24 Articles that address procedures, requirements, and conditions for the registration of qualified foreign investors (QFIs) with the CMA to invest in listed securities in the Saudi stock market.
The most significant change is the decrease in the amount that a firm must have in assets under management (AUM), from $5 billion to $1 billion, which will enable access to the market for smaller investment houses.
The rule changes also state that a government entity may invest in the Saudi stock market, and they include the option for QFIs to engage with a Saudi or non-Saudi portfolio manager to manage its investment in the Saudi Capital Market.
Also under the new rules, individual foreign investors can own up to 10 percent of shares outstanding in a single company, up from 5 percent.
The draft changes were published on the CMA’s website for 30 days for consultation, the regulatory body said Wednesday. The CMA said the changes were made after consulting investors and specialists.
The changes will take effect on September 4th.
