Saudi Gazette report

RIYADH — The Capital Market Authority (CMA) has introduced a draft law expanding the scope of foreign nationals who may invest in shares listed on the Saudi main stock market or All Tadawul Share Index (TASI).

Under the draft amendment to the Investment Accounts Instructions, the Rules Governing Foreign Investment, and the Financial Market Institutions Regulations, the authority will allow a foreign national residing in one of the Gulf Cooperation Council countries, and a foreign national who has previously resided in the Kingdom or in one of the GCC countries, to invest in shares listed on the main market.

The proposed amendments allow individual foreign investors, who previously resided in Saudi Arabia or one of the GCC countries to continue operating their investment accounts and invest in shares listed in the main market even after their residency has ended and they return to their home country, provided they have previously opened an investment account in Saudi Arabia.

The proposal, which was presented by the authority on the Istithlaa platform in preparation for its approval, also aims to facilitate the procedures for opening and operating investment accounts for a number of categories of clients of financial market institutions, while taking into account enhancing client protection.

The CMA called upon relevant and interested persons participating in the capital market to share their feedback on facilitating the procedures for opening investment accounts for various categories of investors within the proposed “Amendments of the Investment Accounts Instructions and the Rules for Foreign Investment in Securities and the Capital Market Institutions Regulations” for a period of 30 days ending on December 20, 2024.

The key elements of the proposed draft include developing the requirements for opening an investment account for individual foreign investors residing in one of the GCC countries and expanding the types of securities they can directly invest in, including shares listed on the main market. Currently, their participation is limited to the debt market, the parallel market (Nomu), investment funds, and the derivatives market.

To open investment accounts for foreigners residing in the GCC countries, the resident's identity data and a valid passport must be submitted. As for foreigners who are not residing in the Kingdom or in the GCC countries, a valid passport must be produced.

The amendments prohibited the opening of investment accounts for individual institutions, with the exception of non-profit and endowment institutions, according to the draft law.