The Capital Market Authority ("CMA") Board issued its resolution approving the amended Capital Market Institutions Regulations, the amended Investment Accounts Instructions, the amended Rules on the Offer of Securities and Continuing Obligations, and amending the Glossary of Defined Terms Used in The Regulations and Rules of the Capital Market Authority, which shall be effective as of the date of their publication.
These amendments aim to support financial technology innovations in the capital market by setting out a regulatory framework for equity crowdfunding, including determining the requisite authorization for capital market institutions to carry it out, and to enable companies that have a Financial Technology Experimental Permit (FinTech ExPermit) to obtain the appropriate authorization to practice it as a capital market institution, in line with the international best practices in this regard.
The amendments include regulating share offering through capital market institutions that are authorised to carry out arranging activities in the course of carrying out securities crowdfunding.
Also, the amendments comprised setting the requirements for custody of clients' money received by capital market institutions that are authorised to carry out arranging activities in the course of carrying out securities crowdfunding, and opening and operating investment accounts.
This comes after the CMA has published the draft Regulatory Framework for Equity Crowdfunding on its website and the Unified Electronic Platform for Consulting the Public and Government Entities (Public Consultation Platform), affiliated with the National Competitiveness Center, for public consultation for a period of (45) calendar days.
It is expected that the amendments shall reflect on enabling the Capital Market Institutions that are authorised to carry out arranging activities to offer of securities via Equity Crowdfunding platforms, as well as the custody of the clients' money in the course of carrying out securities crowdfunding.
The amended Capital Market Institutions Regulations, the amended Investment Accounts Instructions, the amended Rules on the Offer of Securities and Continuing Obligations, and the amended Glossary of Defined Terms Used in the Regulations and Rules of the Capital Market Authority can be viewed via the following links:
Amended Capital Market Institutions Regulations
Amended Investment Accounts Instructions
Amended Rules on the Offer of Securities and Continuing Obligations
Amended Glossary of Defined Terms Used in the Regulations and Rules of the Capital Market Authority
