(a) Any reference to the “Capital Market Law” in these Regulations shall mean the Capital Market Law issued by Royal Decree No. M/30 dated 2/6/1424H.

(b) Expressions and terms in these Regulations have the meaning, which they bear, in the Capital Market Law and in the Glossary of defined terms used in the Regulations and Rules of the Capital Market Authority, unless the context indicates otherwise.

A securities activity shall mean any of the following activities:

• 1) Dealing: a person deals in a security as principal or as agent, and dealing includes to sell, buy, manage the subscription or underwrite securities;

• 2) Arranging: a person introduces parties in relation to offering of securities or arrangement of its underwriting, or advises on corporate finance business;

• 3) Managing: a person manages a security belonging to another person in circumstances involving the exercise of discretion, or operates investment funds;

• 4) Advising: a person advises another person in relation to a security, which includes advising on the merits of that person dealing in it, exercising any right to deal conferred by it or financial planning and wealth management in it; or

• 5) Custody: a person safeguards assets belonging to another person which include a security, or arranges for another person to do so, and custody includes taking the necessary administrative measures.

Securities business shall mean engaging in any of the securities activities specified in Article 2 of these Regulations by any person acting by way of business unless any of the exclusions specified in Chapter 2 of this Part apply.

A person carries out securities business in the Kingdom if:

• (a) he engages in securities activity from a permanent place of business in the Kingdom;

• (b) he is presumed to carry on a securities activity from a permanent place of business in the Kingdom in any of the following situations:

  • 1) he engages in the relevant activity, or in securities business generally, in the Kingdom; or

  • 2) he engages in the relevant activity with or for a person in the Kingdom.

A person must not carry on securities business in the Kingdom unless he is:

• 1) a capital market institution authorised by the Authority; or

• 2) an exempt person as specified in Annex 1 to these Regulations.

Contravention of Article 5 of these Regulations is an offence in accordance with Article 60 of the Capital Market Law.