The Capital Market Authority's (CMA's) Board approved allowing capital market institutions to open “Omnibus Accounts" for their clients. This was achieved by amending one of the Articles of the Capital Market Institutions Regulations and Investment Accounts Instructions related to enabling the registration or record of securities for a client in the name of the capital market institution, and the related regulatory provisions. These amendments will take effect from the date of their publication.
The approval of these amendments by the Board is aimed at developing the trading mechanisms available in the Saudi capital market, promoting investment, and enhancing the market's attractiveness and efficiency. This is achieved by enabling the opening of omnibus accounts, which are accounts registered in the name of a capital market institution and opened by a capital market institution to perform securities custody activities (Custodian). This account includes a number of clients of the capital market institution (Beneficiaries), for whom the institution is responsible for managing, monitoring, and handling the account on their behalf.
The role of the capital market institution will become more active with the approved amendment, as it will be responsible for maintaining client records under each omnibus account, detailing individual ownership for each beneficiary, and obtaining written consent from beneficiaries to register their assets in the institution's name and disclose any associated risks.
The approved regulatory framework includes provisions for capital market institutions to maintain separate records and accounts that enable them to distinguish their assets from those assets of each client joined to the omnibus account, in order to enhance the protection of clients' assets.
The Board's decision approving the amendments came after the CMA published the
Draft Regulatory Framework for Omnibus Accounts on the 3rd of July 2024 on the Unified Electronic Platform for Consulting the Public and Government Entities (Public Consultation Platform), affiliated with the National Competitiveness Canter and the CMA's website for public consultation.
The amended Capital Market Institutions Regulations and Investment Accounts Instructions can be viewed via the following links:
Capital Market Institutions RegulationsInvestment Accounts Instructions
