capital markets authority: Regulation and Oversight of the Saudi Financial

The capital markets authority (Saudi Capital Market Authority) is the primary reference for regulating and developing the financial market in the Kingdom. Established by royal decree in 2003, it is the government body responsible for setting and implementing securities-related legislation and regulations across all financial market activities. Its responsibilities include issuing regulations, licensing financial market institutions, monitoring broker activities, organizing public offerings, and ensuring fair financial disclosure by listed companies. The authority aims to uphold the highest standards of transparency and investor protection, while developing market infrastructure to support the Kingdom’s economic objectives. Its mandate covers oversight of Tadawul (the Saudi Stock Exchange), brokerage firms, public and private investment funds, sukuk, bonds, and other financial products. While the authority does not interfere in investor decisions, it provides a legal framework that ensures market fairness. The presence of the capital markets authority is fundamental to the confidence of both individual and institutional investors in the Saudi market, as it guarantees financial stability and prevents irregular practices.

The capital markets authority seeks to achieve a set of strategic objectives aligned with Saudi Vision 2030. Key goals include strengthening the financial market’s role as a primary driver for national economic financing, increasing market attractiveness to local and international investors, and expanding the investor base among individuals and institutions. The authority facilitates the listing of new companies, develops innovative financial products such as sukuk and REITs, and provides an investment environment characterized by transparency and fairness. It also sets policies to enhance governance, disclosure, and the adoption of ESG standards, in addition to supporting financial innovation and modern technologies in the markets. These efforts help diversify national income sources, reduce reliance on oil, and open new opportunities for investors. The authority’s annual reports indicate tangible progress toward Vision 2030 targets, especially through increased managed assets and a broader range of financial products and services.

The capital markets authority operates through an integrated organizational structure that includes a Board of Directors chaired by the Minister of Finance and several experienced members from both the public and private sectors. The board sets the authority’s general policies and oversees their implementation. The authority comprises specialized departments such as Market Supervision, Licensing, Financial Product Development, Investor Protection, and Legal Affairs. Each department has defined responsibilities to ensure effective oversight and regulation. This precise structure enables the authority to make swift decisions and update regulations in line with local and international developments. Specialized teams conduct research and analysis and issue periodic reports covering all market updates. The authority is committed to corporate governance standards and focuses on developing qualified national talent capable of keeping pace with global financial sector developments.

The capital markets authority is responsible for issuing regulations and instructions governing all aspects of the Saudi financial market. Key legislation includes the Capital Market Law, executive regulations for companies, the Financial Market Institutions Law, investment account guidelines, and specific regulations for issuing sukuk, bonds, and investment funds. The authority continually reviews and updates these regulations to keep pace with local and global developments and to ensure alignment with international best practices. For example, in 2024, the authority issued new guidelines for real estate contribution certificates and amended the regulations for listed joint-stock companies. The regulations focus on enhancing disclosure, protecting investor rights, preventing manipulation and insider trading, and providing clear dispute resolution mechanisms. Listed companies are required to disclose their financial results regularly and adhere to strict internal governance standards.

The capital markets authority supervises all financial brokerage firms in the Kingdom by granting licenses and monitoring compliance with regulatory standards. The authority sets strict controls to ensure broker efficiency and client fund protection, and requires them to implement anti-money laundering procedures. It also licenses asset management companies and both public and private investment funds, monitoring their risk management and disclosure to investors. These measures provide a framework that safeguards investor rights and prevents irregular practices. The authority closely monitors brokers and asset managers through periodic reports and field inspections, imposing penalties for violations. This has raised professionalism and increased investor confidence in the Saudi financial market ecosystem.

The capital markets authority’s 2024 annual report revealed record growth in the Saudi financial market. Managed assets surpassed SAR 1 trillion for the first time, up 20.9% from 2023. The number of active investment funds reached 1,549, while fund subscribers exceeded 1.72 million, a 47% increase over the previous year. Tadawul recorded record levels in activity and total market capitalization of listed companies, although the authority does not own market data but supervises the exchange itself. In 2024, the authority issued several new regulations, such as real estate contribution certificate guidelines and amendments to financial institution regulations. In November 2025, the authority launched the Open Data Library, providing investors and researchers with regular reports and statistics in electronic formats, as part of efforts to enhance transparency and investor awareness.

The capital markets authority plays a central role in regulating initial public offerings (IPOs) and company listings on the Saudi stock market. It sets clear standards for accepting new companies and requires full disclosure of their financial status and future plans before listing. The authority supervises the IPO process to ensure transparency and equality among all investors and strictly prohibits manipulation or leakage of insider information. After listing, the authority continues to monitor listed companies, requiring regular disclosure of financial results and any material changes in operations. These measures have boosted investor confidence and increased the Saudi market’s appeal to local and international companies seeking to list. The authority has also helped expedite IPO procedures and expand the base of listed companies, supporting the diversification of the national economy.

The capital markets authority places utmost importance on transparency and financial disclosure, requiring all listed companies to regularly disclose their financial data, strategic plans, and any material events affecting their share value. In 2025, the authority launched the Open Data Library, enabling investors to easily and transparently access financial reports and statistics. The authority also monitors brokers’ and companies’ compliance with timely and accurate disclosure, imposing strict penalties for violations such as publishing misleading information or data manipulation. These measures aim to raise trust in the Saudi financial market and empower investors to make decisions based on accurate and reliable information.

The capital markets authority keeps pace with global developments in financial technology (FinTech), launching programs to support fintech companies and permitting the launch of modern electronic trading platforms and mobile investment applications. The authority has established specific regulations for electronic trading and investor data protection and encourages the use of artificial intelligence and big data analytics in portfolio management. Among its recent initiatives, the authority has simplified electronic registration and disclosure procedures, making it easier for investors to access data and enhancing market efficiency and opportunities for financial innovation. These efforts align with Vision 2030’s focus on digital transformation and the knowledge economy.

The capital markets authority coordinates with several other regulatory bodies within the Kingdom, such as the Saudi Central Bank (SAMA), which oversees banks and insurance companies, and the Ministry of Finance. The authority’s role complements SAMA’s in supervising the financial sector, with the authority focusing on securities market regulation while SAMA handles monetary policy and the banking sector. The authority also participates in the Financial Sector Development Program (FSDP) to achieve Vision 2030 objectives. Internationally, the authority collaborates with counterparts such as the US Securities and Exchange Commission (SEC), the UK Financial Conduct Authority (FCA), and emerging market regulators. The authority strives to adopt international best practices, raise local market standards, and enhance the Saudi market’s position in global indices.

The capital markets authority is committed to protecting the rights of individual and institutional investors by establishing strict regulations that ensure fairness and transparency in all transactions. The authority requires companies and brokers to disclose all material information and prohibits insider trading or misuse of non-public information. It also provides clear mechanisms for submitting complaints and appeals, allowing investors to file complaints electronically or through customer service centers. The authority follows up on all complaints, investigates violations, and imposes necessary penalties on violators. It also organizes awareness campaigns and educational programs for investors about their rights and responsibilities, providing educational materials through its website.

The years 2024 and 2025 saw the issuance of several important decisions by the capital markets authority, including guidelines for real estate contribution certificates, amendments to the executive regulations for companies, and new investment account instructions. The authority also launched the electronic open data library initiative in November 2025, providing financial reports and statistics in an easily analyzable format for investors and researchers. The Saudi stock market also witnessed notable IPO activity and sukuk issuances, with increased oversight of irregular transactions. The authority expanded investor education programs and increased international cooperation to enhance the Saudi market’s global standing. These developments reflect the authority’s commitment to enhancing transparency and developing regulations to support market growth.

The capital markets authority is expected to continue its efforts to address challenges facing the Saudi financial market, such as global market volatility, diversifying financial products, and increasing market attractiveness to foreign investors. The authority’s future plans focus on developing regulations to keep pace with digital innovation, enhancing governance, and adopting ESG standards. It also aims to support new listings, expand the investor base, and improve protection and disclosure mechanisms. Digital transformation is a key priority, with the authority targeting streamlined procedures and expanded open data platforms. Through these efforts, the authority aims to solidify the Saudi financial market’s position as one of the largest and most efficient emerging markets globally, while maintaining its stability and integrity.