CMA LAW: Press Release: The Capital Markets Authority Issues a Resolution on the Amendment of Some Provisions of the Executive Bylaws and their Amendments Concerning Exchange Traded Funds

Kuwait, June 18, 2026 – Within the framework of the Capital Markets Authority’s (CMA) continuous efforts and pursuit to develop the capital markets and introduce investment instruments in accordance with international standards and best practices, and in line with the CMA’s role stipulated in Law No.7 of 2010 and its Executive Bylaws, the CMA has issued on Thursday June 18, 2026, Resolution No. (80) of 2026 regarding amendment to some provisions of the Executive Bylaws of Law No. 7 of 2010 and their amendments and issuance of investment regulations related to Exchange Traded Funds. The CMA has also approved the amendment to Boursa Kuwait Rulebook and the Central Securities Depository Rules to complete the necessary regulatory framework.

The Resolution includes several amendments, such as amending some provisions of the Executive Bylaws of Law No. 7 of 2010 related to Exchange Traded Funds in Module Thirteen (Collective Investment Schemes) to include and activate the right to trade and to list Exchange Traded Funds, and to clarify the mechanism for valuating Exchange Traded Funds assets.

Additionally, Article (3-1) of Module Twelve (Listing Rules) was amended. This amendment aims to regulate the listing of Exchange-Traded Funds established outside the State of Kuwait, thereby attracting and encouraging foreign investment in the Kuwaiti market.

This Resolution complements the CMA’s efforts to develop and regulate investment funds, and reinforces recent steps conveyed, including the development of existing investment controls and the regulation of Multi-Asset Funds. This contributes to increasing market efficiency, enhancing governance, transparency, disclosure, protecting investors, and supporting the development of a strong and sustainable investment environment for funds in the Kuwaiti market.

The mentioned Resolution is part of a series of resolutions of the Market Development Program, of which the second part of the third phase was launched by the CMA in July of last year. As a continuation of previous efforts, including the adoption of the legislative framework for listing and trading bonds and sukuk, which aims to diversify investment instruments and enhance the attractiveness of the local market. 

It is worth noting that these amendments are the result of joint institutional cooperation between the Capital Markets Authority, Boursa Kuwait, and the Kuwait Clearing Company, within an integrated framework that reflects the spirit of partnership and contributes to establishing an advanced investment environment characterized by efficiency, flexibility, and sustainability, in line with Kuwait Vision 2035 for a diversified economy based on innovation and investment.

Confirming the CMA's participatory and transparent approach to developing its legislative system, the CMA was keen to consider the opinions of stakeholders and review their comments on the draft amendments, which were presented to the related parties to gather feedback. These comments were carefully studied and analyzed by specialized working groups, and some were incorporated considering the CMA's vision and international best practices before final approval.

Among the key technical features of the Exchange Traded Funds regulated in accordance with this Resolution are the following:

- An Exchange Traded Fund is an open-ended fund listed and traded on the Exchange, allowing investors to buy and sell its units during trading hours at real-time prices.
- The Fund aims to track the performance of a specific index (shares or commodities), with a "Tracking Error" that reflects the accuracy of the index's simulation and allows investors to evaluate the performance of the Fund Manager.
- Exchange-Traded Fund units are established against components of assets, while allowing in-kind subscriptions to the Fund.
- The Fund's structure includes additional service providers such as an Authorized Participant and a Market Maker, with the permission of combining some of these roles according to specific regulations.
- The Exchange Traded Fund assets are evaluated at the end of each trading day on the Exchange. The net asset value (NAV) per unit is displayed on the Exchange's website no later than fifteen minutes before the start of the next trading session.
- The indicative NAV is calculated and published continuously on the Exchange's website throughout the trading session (every 15 seconds).
- Clear controls govern the process of selecting the Fund's benchmark index. The benchmark index must be one of the Exchange's indices or from an index provider that is a member of the Index Providers Association and complies with EU regulations regarding index preparation.
- Permitting securities lending and borrowing transactions up to a maximum of 25% of the Fund's net asset value, subject to specific regulations.
- Regulating mechanisms for suspending the trading on any of the index's components.
- Permitting the listing of non-Kuwaiti Exchange-Traded Funds or Feeder Exchange Traded Funds on the Exchange, subject to specific conditions.
- For investors, an Exchange Traded Fund offers immediate portfolio diversification within a single, high liquidity, and transparent instrument with relatively lower risk than other investment instruments.

In conclusion, the CMA invites all related parties to view the latest approved regulations of the Executive Bylaws and work according to its provisions through visiting the following link: www.cma.gov.kw

Ends-
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.

For further information, please contact:
Public Relations & Media Office
Tel: 1888898
Email: pr-media@cma.gov.kw
 

Disclaimer: The information provided on this page is for reference purposes only, visitors are encouraged to review and understand the information provided in the official scanned document attached in the link above (if available). The CMA endeavors to ensure that the information on this page is complete and accurate, but the CMA does not guarantee the quality, accuracy, or completeness of any content at any time. In the event the information on this page is different from the content in the official scanned document attached in the link (if available), the official scanned document attached shall take precedence.