The Capital Market Authority’s (CMA) Board approved the "Instructions for the Foreign Strategic Investors' Ownership in Listed Companies" ("the Instructions"), which will be effective as of the date of their publication. These Instructions are aimed at the foreign legal person who intends to own a strategic shareholding in the listed companies, and for which the aim is to promote the financial or operational performance of the listed companies on the long-term ("foreign investor").

Among the most prominent aspects and features of the Instructions are that they allow the non-financial foreign investor to invest in the Saudi capital market after it was focused on financial investors; in addition to not setting a maximum or minimum limit on the ownership percentage of the foreign investor in the listed companies, accompanied with the ease in the procedures for opening accounts and owning shares through the Authorized Persons. Further, the instructions takes into account the imposition of a prohibition period on the foreign strategic investor in respect of disposing of any shares he owned during the two years following the date of ownership of those shares.

In this regard, H.E. Mr. Mohammed bin Abdullah Elkuwaiz, Chairman of the Capital Market Authority mentioned, "the CMA has approved these Instructions as part of opening the capital market and the Saudi economy to the outside world, as we noticed a growing interest from foreign strategic investors to invest in companies listed on the Saudi Stock Exchange".

Mr. Elkuwaiz further added, "the Instructions are complementary to the “Rules for Qualified Foreign Financial Institutions Investment in Listed Securities”, approved by the CMA in 2015G and which has witnessed numerous developments since they came into effectivity. However, while the Rules are targeting the qualified foreign financial institutions (Financial Investor), these Instructions are concerned with foreign strategic investors".

It is worth mentioning that since the beginning of 2019, the Saudi Stock Exchange has witnessed increasing foreign cash flows after the beginning of the Saudi Stock Exchange inclusion tranches in the emerging markets indicators. The number of qualified foreign investors increased by 163.7 per cent to become 1,195 investors as of 20/06/2019G, after they were 453 investors at the beginning of the current year. Moreover, the ownership percentage of foreign investors in the Saudi Capital Market has reached 7% as of 20/06/2019G, compared to 4.7% at the beginning of this year.

The Instructions can be viewed via the following link: Instructions for the Foreign Strategic Investors Ownership in Listed Companies

Capital Market Authority
Communication & Awareness Department
+966114906513
+966504206745
Media@cma.org.sa
www.cma.org.sa  

The Capital Market Authority (CMA) is the supervisory and administrative authority responsible for regulating and developing the financial market by issuing the laws, regulations and instructions necessary to implement the rules of the Capital Market Law, in order to provide the appropriate climate for achieving confidence, fairness and efficiency for issuance of securities and full disclosure of joint stock companies and protect investors from the illegal acts in the stock market.

For more information about CMA, please visit the official website: www.cma.org.sa 

© Press Release 2019

Disclaimer: The contents of this press release was provided from an external third party provider. This website is not responsible for, and does not control, such external content. This content is provided on an “as is” and “as available” basis and has not been edited in any way. Neither this website nor our affiliates guarantee the accuracy of or endorse the views or opinions expressed in this press release.

The press release is provided for informational purposes only. The content does not provide tax, legal or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Neither this website nor our affiliates shall be liable for any errors or inaccuracies in the content, or for any actions taken by you in reliance thereon. You expressly agree that your use of the information within this article is at your sole risk.

To the fullest extent permitted by applicable law, this website, its parent company, its subsidiaries, its affiliates and the respective shareholders, directors, officers, employees, agents, advertisers, content providers and licensors will not be liable (jointly or severally) to you for any direct, indirect, consequential, special, incidental, punitive or exemplary damages, including without limitation, lost profits, lost savings and lost revenues, whether in negligence, tort, contract or any other theory of liability, even if the parties have been advised of the possibility or could have foreseen any such damages.