Title: Press Release: The Capital Markets Authority Approves the Regulatory Framework of Passporting Products among the Regulatory Entities of Capital Markets in GCC Countries

Kuwait, December 10, 2022 – As part of the main objective of the Gulf Cooperation Council (GCC) to strengthen the ties and develop cooperation relations, reach integration in the financial markets in the Gulf market in a way that enables citizens of the GCC countries and residents to invest and trade in all Gulf markets easily and without discrimination, and develop markets and their economic growth along with offering new products; the GCC regulatory entities of capital markets agreed at the meeting of the Ministerial Committee of the the Heads of Entities Regulating the Capital Markets in the GCC Countries held on November 16, 2022 on the mutual regulatory framework of Passporting products between the entities regulating the capital markets in the GCC Countries. The CMA Board of Commissioners decided in its meeting held on December 7, 2022, to approve the final draft of the regulatory framework of passporting products of financial products among the regulatory entities of the capital markets in the GCC countries.

This mutual regulatory framework aims at regulatory coordination with regard to passporting products registered in their jurisdictions. Passporting regulations are considered as controls and conditions for registering financial products to be promoted across the regions of jurisdiction of the regulators. The registered financial product shall meet the minimum standards specified in the passporting regulations.

The regulatory entity is responsible for supervising all financial products and related services while adhering to national legislation and passporting regulations. The regulatory entities shall also agree to facilitate cooperation among themselves regarding supervision and control. Moreover, the regulatory framework allows requesting assistance between regulatory entities to conduct investigations about the financial product and provide information including reporting violations or penalties.

It is worth noting that the framework comes into effect after the regulating entities complete the necessary internal procedures to activate this framework and inform the General Secretariat of the GCC countries.

The regulatory framework for passporting, after being approved by the Board of Commissioners, is considered part of the CMA Executive Bylaws. The CMA will soon develop a separate module for this purpose that includes the regulatory framework for passporting. It will be published among the modules of CMA Executive Bylaws, followed by the regulations that may be introduced on passporting regulations after the approval of the Heads of GCC Capital Markets Authorities Committee on each financial product separately.

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Notes to Editors:
The Capital Markets Authority was established pursuant to Law No. 7/2010, approved by the Kuwaiti Parliament in February 2010. Pursuant to the Law, the CMA shall regulate and supervise the securities activities, achieve transparency and fairness, observe listed companies’ execution of Corporate Governance regulations, and protect investors from unfair practices which violate the CMA's Law.
Furthermore, the Law's provisions stipulate the supervision of mergers, acquisitions, and disclosure operations. The CMA also aims to provide awareness programs related to securities activities.
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