As part of the Capital Market Authority's ("CMA") strategic objectives to develop the capital market, and based on the Capital Market Law issued by Royal Decree No. (M/30) dated 2/6/1424 H, the CMA Board issued its Resolution to publish the draft amendments to Investment Funds Regulations and Real Estate Investment Funds Regulations for public consultation for a period of (60) calendar days ending on 15/12/1441H corresponding to 05/08/2020G.
The CMA seeks to ensure that the Investment funds play an important role in supporting the growth of asset management and institutional investment and providing additional sources for financing and refinance in the economy. The CMA also works to enhance the role of investment funds and developing them by applying best international practices in the global financial markets, to create an effective financial sector capable of creating more investment opportunities for the general investors.
The draft amendments to Investment Funds Regulations and Real Estate Investment Funds Regulations aim to develop the capital market, enhance the principals of investors protection, and regulate aspects that would enhance investment in these funds.
It is also worth noting that in order to facilitate access to the relevant regulatory provisions, the draft amendments included merging the Investment Funds Regulations with the Closed-ended Investment Traded Funds Instructions issued by the CMA Board Resolution No. (2-66-2018) dated 22/9/1439H corresponding to 6/6/2018G, and merging the Real Estate Investment Funds Regulations with the Real Estate Investment Traded Funds Instructions issued by the CMA Board Resolution No. (6-130-2016) dated 23/1/1438 H corresponding to 24/10/2016G, amended by Resolution No. (2-115-2018) dated 13/2/1440H corresponding to 22/10/2018G, which also included proposed amendments to enable closed-ended funds and real estate investment traded funds to buy-back its units, and to allow offering and listing of the closed-ended funds units, real estate investment traded funds units and exchange traded funds units in the Parallel Market (Nomu). In addition, the suitability of moving the provisions regulating private real estate funds from the Investment Funds Regulations to the Real Estate Investment Funds Regulations will be considered in light of the comments received during public consultation.
Also, the draft amendments to Investment Funds Regulations and Real Estate Investment Funds Regulations included proposed amendments in alignment with the draft amendments to the Authorised Persons Regulations, which had been published for public consultation, in relation to developing the types of authorisation for managing activities, client classification, requirements for Know Your Customer, client understanding of risk, and client suitability.
The CMA, with full gratitude, would receive the opinions and comments of relevant and interested persons through the prescribed form via the following email (Laws.Regulations@cma.org.sa).
All comments will be taken into full consideration for the purpose of finalizing the Draft Amendments.
The Draft Amendments and the prescribed form for providing comments can be viewed via the following link:
Draft Amendments to the Real Estate Investment Funds Regulations
Draft Amendments to the Investment Funds Regulations
Public Consultation Form - Draft Amendments to the Investment Funds Regulations
Public Consultation Form - Draft Amendments to the Real Estate Investment Funds Regulations
