• 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 contrary intention appears.

• A) It is prohibited for any person to engage in or participate in any actions or practices that involve manipulation or deception regarding an order or transaction related to a security, if that person is aware of the nature of that action or practice, or if there are reasonable grounds that allow them to be aware of the nature of that action or practice.

• B) It is prohibited for any person to directly or indirectly enter an order or execute a transaction on a security with the intention of creating any of the following:

  • 1) A false or misleading impression of trading activity in the security or interest in buying or selling it.

  • 2) An artificial price for the demand, offer, or trading of the security or any related security.

• C) The prohibition stated in this article applies when any person enters an order or executes a transaction on a security using any means, including the use of technical tools to create and automatically enter orders based on predetermined instructions or calculations.

• A) The following actions and transactions are considered types of manipulation or deception:

  • 1) Conducting a fictitious trading transaction.

  • 2) Promoting the purchase of a security with the intent to sell that security or arranging for another person to sell it.

  • 3) Promoting the sale of a security with the intent to purchase that security or arranging for another person to purchase it.

• B) The following actions and transactions are considered types of manipulation or deception when committed with the intent to create a false or misleading impression of trading activity in a security or interest in buying or selling it, or with the intent to create an artificial price for a bid, offer, or trade of a security:

  • 1) Executing a trading transaction on a security that does not involve a change in its actual ownership.

  • 2) Entering an order or orders to purchase a security with prior knowledge that a similar and comparable order or orders in terms of size, timing, and price have been or will be entered to sell that security.

  • 3) Entering an order or orders to sell a security with prior knowledge that a similar and comparable order or orders in terms of size, timing, and price have been or will be entered to purchase that security.

  • 4) Buying or making offers to buy a security at consecutively increasing prices, or in a pattern of consecutively increasing prices.

  • 5) Selling or making offers to sell a security at consecutively decreasing prices, or in a pattern of consecutively decreasing prices.

  • 6) Entering an order or orders to buy or sell a security with the intent to:

    • - Set a predetermined price for sale, offer, or bid.

    • - Achieve a high or low opening or closing price for sale, offer, or bid.

    • - Influence the indicative price of a price fluctuation auction.

    • - Keep the sale, offer, or bid price within a predetermined range.

    • - Enter an order or series of orders on a security without the intention to execute them.

    • - Influence the price of another security.

• C) The following actions and transactions are not considered types of manipulation or deception:

  • 1) A company purchasing its own shares if it is in accordance with the provisions of the regulations and procedures issued in implementation of the Companies Law for listed joint-stock companies.

  • 2) The purchase of shares by the price stabilization manager if it is in accordance with the provisions of the instructions regulating the price stabilization mechanism for initial offerings.

  • 3) The purchase or sale of securities by the market maker if it is in accordance with the regulations, rules, or procedures issued by the authority or the market.

• A) For the purposes of applying the provisions of Article Fifty of the Law and the provisions of this section:

  • 1) It is required that the security related to the inside information be a traded security.

  • 2) The security related to the inside information means any security whose price or value is materially affected in the event of disclosure of this information or its provision to the public.

  • 3) Any person is considered to be directly trading in a security in either of the following cases:

    • - If he executes a transaction on the security for any account in which he has an interest.

    • - If he submits a purchase or sale offer for the security in the market.

  • 4) Any person is considered to be indirectly trading in a security in any of the following cases:

    • - If he executes a transaction as an agent for another person.

    • - If he arranges a transaction where one of the parties is a relative or a person with whom he has a business or contractual relationship.

    • - If he arranges for his agent or any other person acting on his behalf or according to his directions to trade in the related securities.

  • 5) Trading is considered to be based on inside information if it is done directly or indirectly in a security related to the inside information.

• B) The insider specifically means any of the following:

  • 1) A member of the board of directors, an executive officer, or an employee of an issuer of a security related to the inside information.

  • 2) A member of the board of directors, an executive officer, or an employee of a financial market institution related to the inside information.

  • 3) A person authorized or appointed on an account for which orders that are considered inside information have been or will be entered.

  • 4) A person who obtains inside information through a family relationship, including through any person related to the person obtaining the information.

  • 5) A person who obtains inside information through a business relationship, including obtaining the information:

    • - Through an issuer of a security related to the inside information.

    • - Or through a financial market institution related to the inside information.

    • - Or through a person who owns an account for which orders that are considered inside information have been or will be entered.

    • - Or through any person who has a business relationship with the person obtaining the information.

    • - Or through any person who is a business partner of the person obtaining the information.

  • 6) A person who obtains inside information through a contractual relationship, including obtaining the information:

    • - Through an issuer of a security related to the inside information.

    • - Or through a financial market institution related to the inside information.

    • - Or through a person who owns an account for which orders that are considered inside information have been or will be entered.

    • - Or through any person who has a contractual relationship with the person obtaining the information.

• C) Inside information specifically means information that meets the following:

  • 1) It relates to a security, or to orders entered or to be entered on it.

  • 2) It has not been announced to the general public, and is not available to them in any other form.

  • 3) A reasonable person would understand, given its nature and content, that its announcement or provision to the public would materially affect the price or value of the security.

• a) It is prohibited for an insider to disclose any inside information to any other person, knowing or having reason to know that such other person may trade in the security related to the inside information.

• b) It is prohibited for any non-insider to disclose any inside information obtained by any means to any other person, knowing or having reason to know that the other person to whom the disclosure is made may trade in the security related to the inside information.

• c) Without prejudice to the provisions of Chapter Two of this regulation and the provisions of paragraph (a) of this article, the financial market institution and the registered person may disclose client orders for the purpose of negotiating a private transaction on behalf of that client, provided that the following is met:

  • 1) The disclosure is in the client's interest to complete the transaction.

  • 2) Obtaining the client's prior consent and documenting it.

A) It is prohibited for an insider to trade based on inside information.
B) It is prohibited for a non-insider to trade based on inside information if they know or ought to know that this information is inside information.