Riyadh: The Capital Market Authority (CMA) has invited stakeholders in the capital market to provide their input on the draft 'Regulatory Framework for Debt Instruments Offering Platforms and Investing in Them.' This initiative aims to advance the offering of debt instruments by capital market institutions that are licensed for arranging activities within the securities crowdfunding context. The consultation period is set to last for 30 days, concluding on 25/10/1446H, equivalent to 23/04/2025.
According to Saudi Press Agency, the draft seeks to refine the regulatory framework surrounding platforms for offering and investing in debt instruments by outlining regulatory and licensing requirements. This effort is designed to keep pace with the evolving regulatory environment of the capital market.
Key proposals include allowing capital market institutions to offer debt instruments in the Sukuk and Debt Market upon approval of the draft, and defining the necessary licensing for these institutions to engage in this activity. Additionally, companies with a FinTech Experimental Permit will be able to obtain licenses to operate as capital market institutions, thereby broadening and sustaining corporate financing sources and increasing access to debt instruments for a wider investor base.
Under the proposed draft, capital market institutions must secure an Arranging license in securities activities to conduct these offerings. This would enable them to present debt instruments via securities crowdfunding platforms as part of exempt offering cases, consistent with the Rules on the Offer of Securities and Continuing Obligations.
The draft also addresses developing requirements for registrable functions and safeguarding client funds for institutions licensed to perform Arranging activities in securities crowdfunding.
The proposed changes aim to increase the number of capital market institutions involved in financial technology activities and expand their role in offering debt instruments through securities crowdfunding. This is expected to deepen the debt instruments market and enhance its appeal to issuers and investors, aligning with the CMA's strategic goals.
Debt instruments offering and investing platforms have been tested in the FinTech Lab and are proposed to be part of the Debt Market as a financial product under securities business activities after gathering sufficient supporting data.
The CMA stressed the importance of considering feedback from relevant and interested parties to finalize the Proposed Amendments, contributing to the enhancement and development of the regulatory environment. Opinions and comments can be submitted via: https://cma.org.sa/en/Market/News/pages/CMA_N_3757.aspx.