Logo of Capital Market Authority (CMA)
The Capital Market Authority (CMA) called on relevant and interested capital market players to share their feedback on the proposed draft to develop the regulatory environment for investment funds in the Kingdom. 
The consultation period will run for 30 days, ending on March 7.
The proposed draft aims to enhance the regulatory framework for investment funds by strengthening the asset management industry and boosting its competitiveness by identifying areas for development and adopting global best practices, said the regulator.
In addition, the draft seeks to increase transparency and disclosure levels for fund unit holders, ensure governance standards that protect investor rights, and align with CMA’s strategic objectives to increase the appeal of asset management in the Kingdom, it added.
The launch of this draft coincides with a significant milestone achieved by the entities supervised by CMA, as the total managed assets surpassed SAR 1 trillion mark by the end of 2024.
The key amendments focused on enhancing the efficiency of investment fund management by enabling the distribution of fund units through investment fund distribution platforms and companies licensed by the Saudi Central Bank to provide e-wallet services, as well as improving provisions for terminating investment funds and dismissing fund managers.
Additionally, the project outlines specific provisions for the voluntary withdrawal of public and private fund managers. Among these provisions is the requirement for CMA approval, with the current fund manager being obligated to transfer management responsibilities to the successor within 60 days of receiving approval. This ensures the protection of investors’ rights in public, private, and real estate investment funds, facilitates a smooth transition of fund management, safeguards unit holders’ interests, and bolsters investor confidence in the capital market.
At the level of real estate investment funds listed on the Nomu-Parallel Market, the proposed amendments include allowing these funds, upon their establishment, to invest in real estate development projects without being bound by the investment policy percentages and asset restrictions stipulated in the Real Estate Investment Funds Regulations. This is expected to expand investment opportunities for these funds, support the diversification of their assets, and increase flexibility in this type of fund, thereby enhancing their potential returns for investors.
The draft also aims to allow capital market institutions licensed to conduct investment management activities to distribute foreign funds and offer their securities in the Kingdom, in accordance with specific requirements. This initiative seeks to enable clients in the Kingdom to invest in foreign funds.
Furthermore, the proposal includes the development of several other regulatory provisions aimed at fostering the growth of the investment fund and real estate investment fund sectors.
The regulator emphasized that the comments of relevant and interested persons will be taken into full consideration for the purpose of approving the final proposed amendments, which in turn will contribute to the aim of enhancing and developing the regulatory environment.
Logo of Capital Market Authority (CMA)
The Capital Market Authority (CMA) called on relevant and interested capital market players to share their feedback on the proposed draft to develop the regulatory environment for investment funds in the Kingdom.
The consultation period will run for 30 days, ending on March 7.
The proposed draft aims to enhance the regulatory framework for investment funds by strengthening the asset management industry and boosting its competitiveness by identifying areas for development and adopting global best practices, said the regulator.
In addition, the draft seeks to increase transparency and disclosure levels for fund unit holders, ensure governance standards that protect investor rights, and align with CMA’s strategic objectives to increase the appeal of asset management in the Kingdom, it added.
The launch of this draft coincides with a significant milestone achieved by the entities supervised by CMA, as the total managed assets surpassed SAR 1 trillion mark by the end of 2024.
The key amendments focused on enhancing the efficiency of investment fund management by enabling the distribution of fund units through investment fund distribution platforms and companies licensed by the Saudi Central Bank to provide e-wallet services, as well as improving provisions for terminating investment funds and dismissing fund managers.
Additionally, the project outlines specific provisions for the voluntary withdrawal of public and private fund managers. Among these provisions is the requirement for CMA approval, with the current fund manager being obligated to transfer management responsibilities to the successor within 60 days of receiving approval. This ensures the protection of investors’ rights in public, private, and real estate investment funds, facilitates a smooth transition of fund management, safeguards unit holders’ interests, and bolsters investor confidence in the capital market.
At the level of real estate investment funds listed on the Nomu-Parallel Market, the proposed amendments include allowing these funds, upon their establishment, to invest in real estate development projects without being bound by the investment policy percentages and asset restrictions stipulated in the Real Estate Investment Funds Regulations. This is expected to expand investment opportunities for these funds, support the diversification of their assets, and increase flexibility in this type of fund, thereby enhancing their potential returns for investors.
The draft also aims to allow capital market institutions licensed to conduct investment management activities to distribute foreign funds and offer their securities in the Kingdom, in accordance with specific requirements. This initiative seeks to enable clients in the Kingdom to invest in foreign funds.
Furthermore, the proposal includes the development of several other regulatory provisions aimed at fostering the growth of the investment fund and real estate investment fund sectors.
The regulator emphasized that the comments of relevant and interested persons will be taken into full consideration for the purpose of approving the final proposed amendments, which in turn will contribute to the aim of enhancing and developing the regulatory environment.
