On 6 January 2026, the Saudi Arabian Capital Market Authority (CMA) announced landmark amendments to its regulatory framework, effectively opening the Kingdom’s capital markets to all categories of foreign investors starting 1 February, 2026.
These changes, which include the removal of the Qualified Foreign Investor (QFI) requirements and updates to the Securities Depository Center’s (Edaa) rules for Securities Lending represent a major step in aligning the Saudi market with international best practices.
Key Updates Include:
- The removal of “QFI” concept: Foreign investors will no longer need to meet specific qualification requirements (such as minimum assets under management) to invest directly in the Main Market (TASI). This move aims to diversify the investor base and enhance market liquidity in line with the Saudi Vision 2030. Press release here
- Amendments to Edaa SBL Regulations: To align with these changes, the Securities Depository Center (Edaa) has issued amended Securities Borrowing and Lending (SBL) Regulations and also updated Depository Center Procedures. Coming into effect on the 1st of February 2026, these amendments ensure that the SBL infrastructure supports the broader influx of international capital by allowing various categories of foreign investors to participate in SBL activity without the previous QFI restrictions. Press release here.
While the core SBL framework remains intact, including eligibility restrictions centering on the requirement to be a “Qualified Investor”, the updated SBL Regulations now expressly permit borrowing “for relending to the clients of the Broker, Custody Member, or Foreign Financial Institutions”. As a result, any institution falling within the Glossary definition of Foreign Financial Institution, may relend borrowed Saudi listed securities to their clients.
What this Means for ISLA Members:
The CMA’s announcement is more than just a procedural update; it is a structural shift that directly impacts the global securities lending community. By removing the “Qualified Foreign Investor” (QFI) barrier, a much wider array of ISLA members can now participate directly in the Saudi Main Market, encouraging a more diverse lending supply.
ISLA remains committed to its Middle East strategy. In April we will be hosting our second conference in collaboration with ICMA, where we will explore local market developments, including the aforementioned changes.
This follows the recent publication of a Saudi Annex to the GMSLA which will be updated in due course to reflect these changes. ISLA also intends to reissue an updated version of our “Securities Borrowing & Lending Guide: Kingdom of Saudi Arabia” that was produced with Latham & Watkins in 2024.
These changes along with other market updates are covered in ISLA’s Developing Markets Working Group.
