The Saudi Capital Market Authority (CMA) has announced that foreign investors can now invest in Saudi-listed companies that own real estate in Makkah and Madinah’s holy cities. This significant development aims to attract foreign capital, enhance market liquidity, and support the Saudi economy, particularly in these vital areas.
Foreign investment will be restricted to shares of listed companies owning real estate in Makkah and Madinah, and convertible debt instruments. The maximum foreign ownership is capped at 49% of a company’s shares, with strategic foreign investors excluded from this opportunity.
These new regulations allow foreign investors to participate in the economic growth of these cities while adhering to the Law of Real Estate Ownership and Investment by Non-Saudis.
Supporting Initiatives
The CMA has implemented various measures to attract foreign investment, including:
- Allowing resident foreign investors to participate in the Saudi stock market directly.
- Enabling foreign investor access through swap agreements.
- Facilitating investments by qualified foreign financial institutions.
- Permitting strategic foreign investors to acquire strategic stakes in listed companies.
- Allowing direct investments in debt instruments by foreign investors.
In 2021, the CMA further expanded opportunities by allowing non-Saudis to subscribe to real estate funds investing in Makkah and Madinah, aligning with the goals of Saudi Vision 2030.
Public Consultation and Finalization
The approved controls were finalized after a public consultation process. The draft regulations were made available on the Public Consultation Platform (Istitlaa) and the CMA website, ensuring that stakeholder feedback was considered before the final regulations were implemented.
