Country Governance Briefing: Saudi Arabia's market regulator rewrites its rulebook

Saudi Arabia's governance changes this autumn are coming through regulation rather than legislation, and the Capital Market Authority (CMA) is producing most of it. A royal order appointed Mazen Turki Al-Sudairi chairman of the CMA's board with the rank of minister, the authority said on 16 August. Between 22 and 29 September the authority opened four public consultations and approved stricter rules for the auditors of the companies it supervises.

The process is itself part of the institutional design. Draft rules are posted for 30 days on the Public Consultation Platform run by the Saudi Competitiveness and Business Center, as well as on the CMA's site, and the authority says comments are "taken into full consideration" before final approval. The CMA's 2024 to 2026 strategic plan has three pillars: financing and investment, the market ecosystem and investor protection, according to its 2024 annual report release.

Open reforms

• IPO book-building. A draft published on 22 September would require the underwriting agreement to be effective before book-building starts, with the underwriter obliged to buy all offered shares from that point, and would bar listing if the underwriter's holding means listing requirements are not met. Financial advisers would have to verify that orders reflect cash or cash equivalents actually available to the investor, and issuers would disclose forward-looking financial indicators for at least one year. Comments close on 22 October and the provisions take effect on 2 November, the CMA said; the draft is published.
• Algorithmic trading. A draft of 24 September would cap algorithmic orders at 20 per executed trade in a Main Market security in a single day, excluding the very high liquidity category, calculated for each registered trader, and require firms to test algorithms before use and keep records. Comments close on 24 October and the rules take effect on 1 November, the release says (draft).
• Dealing abroad. A draft of 27 September would apply suitability requirements to client dealing on foreign markets equivalent to the Main Market or the listed debt market, and for margin trades in foreign securities require a margin of at least 50 per cent of the transaction value, with no margin trades in highly leveraged instruments or in companies whose accumulated losses exceed half their capital. It also takes effect on 1 November, the CMA said.
• Earnings calls. A draft of 29 September would require every Main Market company to hold an earnings call twice a year, within five business days of its results and after the market closes, and to publish the presentation and recording immediately. It would apply from the announcement of 2026 annual results, according to the release.

Court and regulator actions

• Auditors. On 29 September the CMA board approved amendments to the Rules for Registering Auditors of Entities Subject to the Authority's Supervision, effective on publication. Registered firms must have enough audit managers holding the SOCPA fellowship or an accepted equivalent, run a quality management system, follow CMA instructions during inspections, submit corrective action plans for approval where an inspection warrants one, and share the CMA's final inspection results on a listed company's audit file with that company's audit committee. Transparency reports must disclose the firm's governance and the result of the annual evaluation of its quality system, the CMA said. The draft had been consulted on from 8 April.
• Takeovers. On 21 September the CMA approved the publication of the offer document from Knauf International GmbH to the shareholders of United Mining Industries Company to acquire all of its shares, along with the offer timetable, its notice shows.
• Licensing. The CMA continued to license new firms, including Khwarizmi Capital Company for advising in securities business on 15 October, its notice shows.
• Investor redress. The CMA's investor-protection pillar includes developing procedures for class action suits and reducing the time from detecting violations to compensating affected parties, and the authority measures the success rate of compensation claims before the Committee for Resolution of Securities Disputes, it said in a study release.

Programme conditions

Saudi Arabia has no IMF programme, and its benchmarks are those of surveillance. The IMF's country page shows the last Article IV board consultation on 28 July 2025. The published report asked for "a countercyclical fiscal stance given heightened global uncertainty" and said the authorities should "address strong credit to mitigate risks to systemic financial stability".

A December article by IMF staff was more specific on institutions. It said "the business environment now rivals that of advanced economies" and that the authorities should "steadfastly implement recently enacted laws that ease access for foreign investors", "adhere to established spending ceilings" and "develop a proper strategy for managing sovereign assets and liabilities", and use the sovereign wealth fund "as a catalyst to spur new projects and partnerships", the article says.

The same article listed three medium-term fiscal measures, "continued non-oil revenue mobilization", "energy subsidy reform" and "more efficient public spending", and noted that non-oil revenue "has doubled over the past five years" while oil prices were "nearly 30 percent below their 2022 peak". It also called for "strong financial sector oversight" as banks rely more on short-term external funding.

What to watch: the final texts after the consultations close between 22 and 29 October, the 1 and 2 November effective dates, the first earnings calls with the 2026 annual results and the IMF's next Article IV.