CMA Amends Market Conduct Regulations to Address (Front Running)

​As part of the Capital Market Authority's (CMA) continuous efforts to develop the capital market and protect investors and based on the Capital Market Law issued by Royal Decree No M30 Dated 261424H and according to the initiatives mentioned in its strategy for the years (2015- 2019), the CMA`s Board of Commissioners issued its resolution amending the Market Conduct Regulations ("Regulations") by adding the number of front running cases to the prohibited practices.

The amended regulations can be viewed on CMA’s website via the following link:

One of the prohibited front running cases that stated on Article (12) of the amended Regulations: "An authorised person, a registered person and any associated  person are prohibited from dealing in any security for their own benefit, or for the benefit of another client, or for the benefit of an account which they have an interest in, including any account which they have a discretion on, if such dealing is on the basis of prior knowledge that a client order has been or will be entered on the same security".

In addition, the regulations include that: "Any person that obtains through an authorised person or a registered person information related to client orders that have been or will be entered is prohibited from dealing in the security related to such information, if such dealing is for the purpose of benefiting from potential material effect of those orders on the price of that security".

The Authority has emphasized that amendments to the Market Conduct Regulations aim to address unfair and unsound practices in securities transactions and in accordance with the best international practices.