Riyadh: Saudi Arabia has fully opened its stock market to all foreign investors. This is the first time such access has been allowed. The change took effect on Sunday, February 1.
Foreign institutions and investment funds can now trade directly. They can invest in shares listed on the Tadawul All Share Index. There is no longer a need for prior qualification.
The new rules bring the Saudi market closer to global standards. Foreign investors can now access Saudi equities directly.
CMA Approves New Regulatory Framework
The decision follows approval by the Capital Market Authority board. The new framework allows non resident foreign investors to trade directly in the main market.
The framework removes the Qualified Foreign Investor system. It also ends rules related to swap agreements. Foreign investors can now own shares directly.
Earlier rules only allowed indirect exposure through swaps. Direct ownership was not permitted at that time.
Foreign Ownership Limits Remain
Despite wider access, ownership limits still apply. Non resident foreign investors cannot own ten or more percent of a listed company. This does not include strategic investors.
Total foreign ownership also remains capped. Resident and non resident foreign investors together cannot exceed forty nine percent. Some companies may have lower limits under their own rules.
New Investor Classifications
Foreign investors are now grouped into several categories:
- Resident foreign investors
- Foreign residents of GCC countries
- Non resident investors
- Foreign legal entities
- Foreign funds
- Strategic investors
Boosting Liquidity and Global Investment
The Capital Market Authority said the changes aim to expand the investor base. They also support foreign investment inflows. Improving market liquidity is another key goal.
Foreign ownership in the Saudi capital market exceeded SR590 billion by the end of the third quarter of 2025. Foreign investments in the main market reached about SR519 billion. This was higher than the figure recorded at the end of 2024.
Saudi regulators expect the move to attract more global capital. They believe it will strengthen the Kingdom’s position in international markets.
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