Riyadh – Mubasher: The Capital Market Authority (CMA) has invited public feedback on proposed regulatory provisions governing financial market activities conducted outside the Kingdom.
The consultation period will remain open for 30 days, concluding on 27 October, with the final regulations scheduled to take effect on 1 November.
The project aims to strengthen the regulatory framework for capital market institutions when dealing with clients in foreign jurisdictions.
Under the proposed rules, suitability requirements will apply to transactions executed in foreign markets that are deemed equivalent to the Saudi Main Market or the listed debt instruments market.
Institutions must verify client suitability before initiating trades in these markets, though reassessment is not required for subsequent transactions unless a material change in client circumstances occurs.
For margin trading in international markets, the draft regulations introduce strict risk controls.
Clients will be required to pay a minimum initial margin of 50% of the transaction value.
Additionally, the proposal prohibits margin trading on highly leveraged instruments or shares of companies with accumulated losses exceeding 50% of their capital.
Feedback is being collected via the "Istitlaa" platform to finalize the regulatory framework.
