​The Capital Market Authority explained that the amended draft of the Rules for Qualified Foreign Financial Institutions Investment, which was available for public consultation on its website, included several amendments that CMA hopes to receive the public and interested parties' comments and observations on them during the specified period  of 30 calendar days starting from 15 Ramadan 1437H corresponding to 20 June 2016. All comments and observations will be taken into consideration for the purpose of issuing the final Rules.

According to the suggested amendments, Qualified Foreign Financial Institutions (QFIs) are allowed to invest in the debt market. In addition, the minimum limit for the assets under management is decreased to 3.75 Billion Riyals as opposed to 18.75 Billion Riyals. Furthermore, the types of the financial institutions are increased to include government funds and university endowments and other entities approved by CMA.

Investments of QFIs shall be subject to the following limitations: each QFI may not own 10% or more of the shares of any issuer whose shares are listed, the maximum proportion of the shares of any issuer whose shares are listed that may be owned by all foreign investors (in all categories, whether residents or non-residents) in aggregate is 49%, other legislative limitations on foreign ownership in joint stock companies, in addition to the limitations set forth in the articles of association or by-laws of the listed companies or any instructions issued by the supervisory or regulatory authorities to which these companies are subject.

One of the objectives of opening the capital market for qualified institutions to invest in listed shares is to support institutional investment in the market. Institutional investment includes specialized individual investors who trade in a manner similar to funds, companies, investment funds, government entities and portfolios  managed by Saudis or non-Saudis, Gulf countries' institutions, swap agreements, strategic partners and qualified investors. Opening the market also aims to attract professional investors, enhance governance and disclosure in listed companies and increase the number of studies and research done on the local market.