Capital Market Authority closes consultation over reforms to Saudi Arabia’s securities rules

The CMA has recently concluded a public consultation on its proposed amendments to the capital markets framework, which would realign its processes towards global best practices.

The proposals (32-pages / 590KB PDF) included reducing the minimum capital requirement of SAR 20million – down from the previous 50 million – and setting a minimum capital requirement for arranging activities which involve holding client funds in securities-based crowdfunding.

It comes as the number of capital market institutions in KSA has more than doubled since 2017 – rising from 86 to 215 by the end of 2025.

Marie Chowdhry, a financial regulations expert with Pinsent Masons in the Middle East, said the proposed reforms reflected an ongoing shift towards a more flexible securities regulatory regime in the Kingdom

“By lowering certain capital thresholds and streamlining licensing requirements, the CMA is clearly seeking to reduce barriers to entry and support a broader range of market participants, including fintech and emerging business models such as securities-based crowdfunding,” she explained.

“At the same time, the introduction of more granular categorisation of dealing activities and enhanced ’know your client’ requirements indicates a move towards proportional regulation, where obligations are better aligned with the risk profile of each activity.

“This is consistent with international regulatory trends and should provide greater clarity for firms structuring their Saudi operations.”

Among the other proposals being consulted on are revising licensing and business commencement requirements by dispensing with the need for some documentation to be submitted, which is currently required during the application process.

There would also be changes introducing sub-categories of dealing activities with differentiated capital requirements, and an increase in KYC obligations tying them to money laundering and terrorism financing risk classifications.

Jessica White, a financial regulatory expert with Pinsent Masons, said the changes would create opportunities for companies looking to engage or develop in the sector, but also raised immediate considerations for existing regulated CMA firms as well.

“Firms should review whether the revised capital requirements and activity classifications enable more efficient structuring of their licences or expansion of services in the Kingdom," she said.

"We are looking forward to seeing the outcome of the responses and how the CMA addresses those moving forward."