a) These Instructions aim to regulate the opening and operation of investment accounts by capital market

institutions when they provide any services related to dealing, management, custody, or investment

through securities crowdfunding platforms activities; and define the regulatory and supervisory rules

related to investment accounts.

b) These Instructions are without prejudice to the Capital Market Law and its Implementing Regulations,

the Anti-Money Laundering Law and its Implementing Regulations, and the Combating-Terrorism

Crimes and its Financing Law and its Implementing Regulations.

a) The capital market institution, before accepting any client and opening an investment account for him,

must ensure his compliance with all of his obligations stated in the Capital Market Law and its

Implementing Regulations, the Anti-Money Laundering Law and its Implementing Regulations, and

the Combating-Terrorism Crimes and its Financing Law and its Implementing Regulations.

b) The capital market institution, when accepting any client, must not provide any services related to

dealing, managing, custody, or investment through securities crowdfunding platforms activities until

obtaining the client’s approval on an investment account opening agreement and documenting such

approval and opening an investment account to that client. The investment account opening agreement

must contain all the information mentioned in Article (4) of these Instructions.

c) The capital market institution may rely on a third party to carry out the customer due diligence measures

in accordance with the related provisions of the Anti-Money Laundering Law and its Implementing

Regulations, and the Combating-Terrorism Crimes and its Financing Law and its Implementing

Regulations for any person for whom these Instructions permit the opening of an investment account.

d) The capital market institution must verify the actual relationship between the clients and the natural

persons who open or operate investment accounts on their behalf such as guardians, agents, trustees, or

authorised signatories in accordance with the relevant provisions in the Anti-Money Laundering Law

and its Implementing Regulations, and the Combating-Terrorism Crimes and its Financing Law and its

Implementing Regulations.

e) In all situations in which these Instructions require the verification of documents, data, or information,

such verification must be done through documents, data or information from a reliable and independent

source.

f) Depending on the risk profile of a particular client, the capital market institution, when carrying out the

customer due diligence measures, must determine if original copies of any of the documents should be

checked in order to verify their validity.

g) The capital market institution, when using technology means to open the investment account, must

carry out the customer due diligence measures depending on the level of risks involved in that, and

according to any requirement that the Authority specifies.

h) The capital market institution must not open an investment account for an individual establishment,

except for organizations licensed under the Law of Civil Society Associations and Organizations, for

which an investment account is opened pursuant to paragraph (d) of Article 7 of these instructions, and

establishments owned by endowments, for which an investment account is opened pursuant to

paragraph (e) of Article 7 of these instructions.

i) Without prejudice to the terms of business with clients’ requirements mentioned in the Capital Market

Institutions Regulations, the capital market institution is exempted from implementing paragraph (b)

of this Article when providing any services related to dealing for its client where such client appoints

an independent custodian.

In addition to the terms of business with clients’ requirements mentioned in the Capital Market Institutions

Regulations, the investment account opening agreement must include, as a minimum, the following:

• a) Information of the client's Identification Document, address, contact information, occupation and, if

  the client is a legal person, its main business activity.

• b) An acknowledgment by the client that he understands the terms and conditions of the investment

  account opening agreement, and that all data and information provided to the capital market institution

  are correct, complete, valid and not misleading.

• c) An undertaking by the client of his commitment to update his data and information or confirm, upon

  the capital market institution's request, that there are no changes to such data and information at the

  end of the relevant time period specified by the capital market institution pursuant to the rules and

  policies approved by the capital market institution in accordance with the level of risks associated with

  the client; and the client’s commitment to provide information of his renewed Identification

  Documents upon the expiration of the original Identification Documents. The client shall provide an

  acknowledgment of his awareness that the capital market institution will freeze his investment account

  upon his failure to meet such commitment, and also provide an undertaking to adhere to the Capital

  Market Law and its Implementing Regulations, and other laws and regulations of the Kingdom,

  especially the Anti-Money Laundering Law and its Implementing Regulations, and the Combating-

  Terrorism Crimes and its Financing Law and its Implementing Regulations.

• d) Unless the company is listed on an exchange, the investment account opening agreement signed with

  any company must include an undertaking to immediately notify the capital market institution upon

  any change to any of the documents, information or data that were previously provided when opening

  the investment account.

Upon the client's request, the capital market institution must provide the client (using any appropriate

means) with the investment account identification information, which shall contain the client's name and

number of the investment account as well as the capital market institution's name.

a) Opening Investment Accounts for Saudi Natural Persons

To open an investment account for a Saudi natural person, the capital market institution must obtain

and verify the client's valid national identification card information.

b) Opening Investment Accounts for the Citizens of the GCC Member States

To open an investment account for a citizen of a GCC member state, the capital market institution

must obtain and verify the client's valid passport or national identification card information.

c) Opening Investment Accounts for Foreign Residents in the Kingdom

• 1) Foreign Residents Carrying a Residence Permit (Iqama) or Resident Identity:

  To open an investment account for a foreign resident who holds a residence permit (Iqama) or

  resident identity, the capital market institution must obtain and verify his valid residence permit

  (Iqama) or resident identity information.

• 2) Holders of the Five Years Residency Card:

  To open an investment account for a holder of a five years residency card, the capital market

  institution must obtain and verify the valid five years residency card information.

• 3) Members of the Diplomatic Missions in the Kingdom:

  To open an investment account for a member of a diplomatic mission in the Kingdom, the capital

  market institution must obtain and verify an identification letter from the member's embassy and

  the member's valid diplomatic identity card information.

d) Opening Investment Accounts for Foreign Natural Persons Residing in the GCC Member States

To open an investment account for a foreign person residing in a GCC member state for the purpose

of investing in the permitted securities in accordance with the Capital Market Law and its

Implementing Regulations and the related instructions issued by the Authority, the capital market

institution must obtain and verify the valid Resident Identity information and passport information.

e) Opening Investment Accounts for Foreign Natural Persons not Residing in the Kingdom or in

the GCC Member States

To open an investment account for a foreign natural person not residing in the Kingdom or in a GCC

member state for the purpose of investing in the permitted securities in accordance with the Capital

Market Law and its Implementing Regulations and the related instructions issued by the Authority,

the capital market institution must obtain and verify the client's valid passport information.

f) Special Provisions for Opening Investment Accounts for Natural Persons

• 1) Opening an Investment Account for a Blind Person or a Person Unable to Read

  • a. When opening an investment account for a blind client or a client unable to read, the client

    shall be entitled to have a personal referee in attendance to explain to him the investment

    account opening procedures and terms and conditions stated in the investment account

    opening agreement. In cases where the client does not have a personal referee in attendance,

    an employee of the capital market institution must explain the procedures to him, and an

    officer in the branch or the main offices of the capital market institution must certify that the

    client was provided with all information of Know Your Customer Form and investment

    account opening agreement, and that terms and conditions of the investment account were

    read to him, and he acknowledged that he bears all responsibilities of opening that investment

    account.

  • b. The referee of the blind person or the person unable to read must be a natural person with

    full legal capacity who personally knows the blind person or the person unable to read

    intending to open an investment account; hold a valid Identification Document; be able to

    explain the investment account opening procedures to the blind person or the person unable

    to read; be able to read the terms and conditions of the investment account opening

    agreement; and provide an acknowledgement in writing of such.

  • c. The Identification Document information of the personal referee must be obtained and

    verified.

  • d. When an investment account is opened for a blind client or a client unable to read, such client

    shall not be allowed to use any services provided by telephone or electronic channels for operating the investment account until one of the capital market institution's employees or

    his personal referee reads to him the terms and conditions related to such services and the

    capital market institution informs him that such services are provided to him based on his

    will, choice, and awareness of the risks associated with using such services and the client’s

    legal liability for all transactions executed through such services. The capital market

    institution shall also obtain a written acknowledgement signed by the client indicating that

    he understands the above terms.

  • e. The capital market institution may use the client's fingerprint or personal stamp as his

    personal signature in all of his transactions.

  • f. With the exception of any transactions carried out by telephone or electronic channels, in

    order for the capital market institution to accept any instructions from a blind client or a client

    unable to read, the capital market institution must obtain the client's signature on such

    instructions with the client's awareness and responsibility of the instructions he signs. Also,

    if the blind client or the client unable to read was accepted as a client with a personal referee

    when opening the account, the capital market institution must obtain an acknowledgement

    in writing signed by a personal referee that meets the conditions stated in subparagraph (b-

    1) of paragraph (e) of this Article that the client is aware of the procedure's nature and that

    he bears liability as a personal referee.

• 2) Opening an Investment Account for Persons Under the Age of (18) Hijri Calendar Years:

  • a. An investment account for a person under the age of (18) Hijri calendar years is opened by

    a guardian, provided that the investment account is under the name of the client and operated

    by the guardian.

  • b. The Identification Document information of the client who is under the age of (18) Hijri

    calendar years and the Identification Document information of his guardian must be obtained

    and verified.

  • c. If the client is a Saudi citizen under the age of (15) Hijri calendar years, the family card

    information that shows the client's information and the valid national identification card

    information of his guardian must be obtained and verified, without requiring the client to

    provide a national identification card.

  • d. If the client is under the age of (18) Hijri calendar years and under legal guardianship, the

    capital market institution must obtain and verify information of the guardian's deed issued

    by the competent court and comply with all its provisions.

  • e. If the client is a foreigner under the age of (18) Hijri calendar years and his name is added to

    another person's residence permit (Iqama) or resident identity, the information of the valid

    residence permit (Iqama) or resident identity (to which the client's name is added) must be

    obtained and verified, provided that the investment account is under the name of the client

    and opened and operated by the holder of the residence permit (Iqama) or the resident identity

    to which the client is added.

  • f. The capital market institution must carry out customer due diligence measures in relation to

    the guardian, and the guardian when acting on behalf of the client under the age of (18) Hijri

    calendar years shall comply with all legal responsibilities applicable to such client.

• 3) Opening an Investment Account for children in need of care

  • a.An investment account for a child residing in one of the housing centers, with a substitute

    (foster) family, in a charity or an association caring for orphans, or in a rehabilitation center

    under the supervision of the Ministry of Human Resources and Social Development is

    opened by the authorised signatories to open the investment account as per the letter of the

    Ministry of Human Resources and Social Development, provided that the investment account

    is under the name of the child and operated by the authorised signatories to operate the

    investment account as per the letter of the Ministry of Human Resources and Social

    Development.

  • b) The capital market institution must obtain information of the following documents and verify

    them:

    • - A letter from the Ministry of Human Resources and Social Development containing the

      child’s information, the names of the authorised signatories to open and operate the

      investment account, and the details of the substitute (foster) family (if the child resides

      with substitute (foster) family).

    • - Information of the Identification Document of the child and authorised signatories to

      open and operate the investment account.

  • c. The capital market institution must carry out customer due diligence measures in relation to

    the authorised signatories to open and operate the investment account, and the authorised

    signatories to open and operate the investment account when acting on behalf of the client

    referred to in subparagraph (a-3) of paragraph (e) of this Article shall comply with all legal

    responsibilities applicable to such client

• 4) Opening an Investment Account for an Incapacitated Person

  • a. An investment account for an incapacitated person is opened by his guardian, provided that

    the account is in the name of the client and operated by his guardian.

  • b. The capital market institution must obtain and verify information of the guardian

    Identification Document and information of the identification card of the incapacitated client

    above the age of (18) Hijri calendar years or information of the family card if the client is

    below the age of (15) Hijri calendar years.

  • c. Information of a final decision or a decision subject to expeditious execution issued by the

    competent court which illustrates that the client for whom the investment account is to be

    opened is considered incapacitated must be obtained and verified, and the capital market

    institution must comply with all its provisions.

  • d. The capital market institution must carry out customer due diligence measures in relation to

    the guardian, and the guardian when acting on behalf of the incapacitated client shall comply

    with all legal responsibilities applicable to such client.

• 5) Opening an Investment Account for a Person Unable to Write and Sign

  The capital market institution must open the investment account for a client unable to write and

  sign in the same procedures of opening an investment account for natural persons. However, the

  capital market institution must take the fingerprints or personal stamp of such client as a substitute

  for his personal signature.

• 6) Opening Investment Accounts for the Interdicted Person

  • a. The investment account of an interdicted person is opened by his guardian, provided that the

    investment account is under the name of the interdicted person and operated by his guardian.

  • b. Information of the Identification Documents of the interdicted person and his guardian must

    be obtained and verified.

  • c. obtain information of a final decision or a decision subject to expeditious execution issued

    by the competent court must be obtained and verified, and the capital market institution must

    comply with all its relevant provisions.

  • d. The capital market institution must carry out customer due diligence measures in relation to

    the guardian, and the guardian when acting on behalf of the interdicted person shall comply

    with all legal responsibilities applicable to such client.

a) Opening Investment Accounts for Saudi Companies and Companies from GCC Member States

• To open an investment account for a Saudi company, the company must be incorporated in

  accordance with the Companies Law, and to open an investment account for a company from a

  GCC member state, the company must fall within the scope of the definition of a GCC legal

  person.

• 2) Unless the company is listed on the Exchange, the capital market institution must verify that the

  company has what provides that it is permitted to invest in the fields it is intending to invest in.

• 3) To open an investment account for a Saudi or GCC company, the capital market institution may

  use the guidance list of documents provided in Annex (1) of these Instructions by obtaining

  information of such documents and verifying them.

• 4) When opening an investment account for a listed company on the Exchange (excluding banks,

  finance companies and capital market institutions insurance companies) or an affiliate of the

  listed company included in its consolidated financial statements, the capital market institution

  must comply with the following additional conditions:

  • - The listed company's investment in securities listed on the Exchange shall be based on a Board

    of Directors' resolution of the listed company and the company that the investment account is

    to be opened for (if it is an affiliate of that company). Such resolution shall also determine the

    investment controls, and prior to opening the investment account, the capital market institution

    must obtain and verify information of the resolution.

  • - Unless the investment of the listed company, or that of its affiliate, is for one year (in which

    period the company commits not to sell the security before the elapsing of one year from the

    time of last purchase of the security issued by the same issuer), the investment in securities

    must be through an investment fund or investment portfolio managed by an capital market

    institution based on a management contract, which clearly states that there is a complete

    segregation between the listed company, its affiliates, and the investment decisions, and that

    the terms of contract do not conflict with such requirement. The capital market institution must

    ensure that the terms of contract are in accordance with these controls prior to signing the

    management contract with the listed company or its affiliate.

  • - The capital market institution must notify the Authority without delay of any management

    contract signed with any listed company or its affiliate and refer to the number of the

    investment account opened for such purpose and the number of the investment portfolio linked

    to it.

b) Opening Investment Accounts for Foreign Legal Persons

• The capital market institution may open an investment account for a foreign legal for the purpose of

  investing in the permitted securities in accordance with the Capital Market Law and its Implementing

  Regulations and the relevant instructions issued by the Authority.

c) Opening Investment Accounts for Funds Owned by a Governmental Entity

• 1) A capital market institution may open an investment account for a fund of a governmental entity,

  provided that the fund is fully owned by a Saudi governmental entity or a governmental entity of

  a GCC member state.

• 2) The capital market institution, when opening an investment account for the fund referred to in

  paragraph (1) above, must obtain and verify information of the following documents:

  • - The fund's bylaws.

  • - The issued resolution assigning the authorised signatories to open and operate the investment

    account of the fund and their valid identity documents.

  • - The fund's articles of association (if any) and its annexes, which clearly show the structure of

    the fund's capital and its management.

  • - Documents that show the names of members of the Board of Directors.

d) Opening Investment Accounts for Non-profit Organisations in the Kingdom:

• When opening an investment account for a Non-profit Organisation in the Kingdom, the capital

  market institution must obtain and verify information of the following documents:

  • - The license issued by the competent authority.

  • - What provides that it is permitted for the organization to invest in the fields it is intending to

    invest in.

  • - The Board of Directors' resolution approving the opening of the investment account and assigning

    the authorised signatories to operate the investment account.

e) Opening Investment Accounts for Endowments or for Establishments Owned by Endowments

• 1) When opening an investment account for an endowment in the Kingdom, the capital market

  institution must obtain and verify information of the following documents:

  • - Approval and endowment registration certificate issued by the General Authority of

    Endowments.

  • - National identification card of the endowment's trustee / board of trustees.

  • - National identification card of the authorised signatories to operate the investment account

    and the delegation resolution (if there is a delegation of the power to operate such account).

• 2) When opening an investment account for an establishment owned by an endowment in the

  Kingdom, the capital market institution must obtain and verify information of the commercial

  register of the establishment, and information of the documents provided in subparagraph (1) of

  paragraph (e) of this Article for the endowment which owns the establishment. investment

  account

f) Opening Investment Accounts for Governmental Entities

• To open an investment account for a governmental entity (Saudi or from another GCC member state),

  the capital market institution must obtain and verify information of the following documents:

  • - The main documents of the governmental entity according to its administrative regulations

    and relevant laws.

  • - The resolution of the competent person in the governmental entity to assign the authorised

    signatories that will open and operate the investment account, and the Identification

    Documents of such signatories.

  • - The approval of the Ministry of Finance issued for the Saudi governmental entity to open the

    investment account, unless there are legal provisions issued by the competent authority that

    explicitly give the right to such governmental entity to invest in securities.

g) Opening Investment Accounts for International Organisations and Institutions:

• To open an investment account for international organisations and institutions that have premises in

  the Kingdom, the capital market institution must obtain and verify information of the following

  documents:

  • - The Association Agreement and/or bylaws.

  • - The premises agreement signed with the government of the Kingdom that permits the

    international organisation or institution to invest in securities.

  • - The resolution of the competent person in accordance with the Association Agreement and/or

    bylaws assigning the authorised signatories to open and operate the investment account.

h) Opening Investment Accounts for Investment Funds Established in the Kingdom or in a GCC

member state:

• To open an investment account for an investment fund established in the Kingdom or in a GCC

  member state, the capital market institution may use the guidance list of documents provided in

  Annex (2) of these Instructions by obtaining information of such documents and verifying them.

If the capital market institution is approached by a natural or legal person for whom these Instructions do

not state the procedures for opening an investment account, the capital market institution must obtain the

Authority's approval to open an investment account for that person.