Saudi Capital Market Authority seeks feedback on rules for overseas trading

The Capital Market Authority in Saudi Arabia is currently seeking feedback on proposed regulations for engaging in securities trading activities outside the Kingdom. This public consultation, which will run for 30 days until October 27, 2026, invites all stakeholders and participants in the financial market to share their opinions on the draft rules. The primary goal of this initiative is to enhance the regulatory framework that governs financial institutions' dealings with clients in markets beyond Saudi Arabia.

The Authority clarifies that suitability assessments are mandatory for transactions conducted in foreign financial markets, provided these markets meet the criteria of being equivalent to the main market or the listed debt instruments market, as stipulated by the Financial Institutions Regulations. Once an institution decides to trade with a client in these markets, it must adhere to suitability requirements without needing to reassess suitability for every subsequent transaction, unless there's a significant change in the client's information or circumstances.

In the realm of margin trading in foreign markets, the project aims to introduce regulatory safeguards to manage related risks. Key provisions include mandating clients to deposit a margin of at least 50% of the transaction value and subjecting them to ongoing monitoring. Additionally, the rules explicitly prohibit margin trading in high-leverage instruments or in companies that have accumulated losses exceeding half of their capital.

The Capital Market Authority has underscored that all public feedback and comments gathered during this consultation will be meticulously reviewed to finalize the regulations governing trading outside the Kingdom, with these rules set to become effective from November 1, 2026. Interested parties can submit their comments through the unified electronic platform for public and government feedback, operated by the Saudi Center for Competitiveness, known as Istitlaa, during the consultation period via the following link: istitlaa.ncc.gov.sa.