Ahmed Al Mamari: We aim to strengthen the capital market's readiness to drive higher levels of performance by providing a diverse and innovative financing and investment environment that enhances its competitiveness in line with the growth of the country’s economy.

H.E. Dr Khamis bin Saif Al Jabri, Chairman of the Board of Directors at the Financial Services Authority (FSA), has approved the Executive Regulation of the Securities Law. The Regulation provides a detailed legislative framework for implementing the general provisions set out in the Securities Law promulgated by Royal Decree No. 46/2022. It is intended to ensure sufficient legislative and technical readiness to enhance the performance of capital market institutions and entities operating in the securities sector, enabling them to keep pace with the rapid developments driven by financial technology and innovative financial instruments.

The Regulation places considerable emphasis on ensuring the availability of competitive financing options within the country’s economy and enhancing regulatory flexibility in a manner that supports the attraction of local capital and foreign capital to the capital market sector. This, in turn, will contribute to supporting the country’s economic activities and strengthening investor confidence by reinforcing the principles of fairness, integrity and transparency.

The decision issued by the Chairman of the Board of Directors at the FSA, stipulates that the Executive Regulation of the Securities Law will enter into force on the day following its publication in the Official Gazette in the issue dated Sunday, 26 July 2026. The decision also authorises the Executive President of the FSA to issue the instructions, forms and circulars required to implement the provisions of the Regulation. Until such instruments are issued, the existing instructions, forms and circulars will remain in force, provided that they are not inconsistent with the Securities Law or its Executive Regulation.

The decision further requires capital market institutions and entities operating in the securities sector to regularise their status within six months from the date on which the Regulation enters into force. Licensed banking institutions carrying out activities undertaken by entities operating in the securities sector have been granted a maximum transitional period of three years to regularise their status by providing such activities through an independent entity. This requirement does not apply to custody and trust services or underwriting activities, which banks may continue to undertake alongside their commercial banking activities pursuant to Article II of the Regulation.

Structural transformation of Oman’s capital market

Ahmed bin Ali Al Mamari, Vice Executive President of the FSA, said that the Regulation follows a comprehensive review of the legislative framework governing Oman’s capital market sector, undertaken to position the sector as one of the principal sources of financing in support of the country’s priorities outlined in Oman Vision 2040.

Speaking exclusively to Oman News Agency (ONA), Al Mamari said that the Executive Regulation represents a structural transformation of Oman’s capital market, as it redesigns the market’s regulatory framework by setting out detailed provisions governing capital market institutions and entities operating in the securities sector, including minimum capital requirements and their regulatory obligations.

Al Mamari added that the Regulation introduces investment banking as a regulated activity within the framework governing entities operating in the securities sector, enabling investment banks to perform their intended role in supporting the primary market and enhancing market liquidity. As intermediaries and advisers between companies and investors, investment banks play a key role in structuring financing solutions that are aligned with the nature and duration of investment projects, thereby supporting the continued development of the capital market sector.

Under the Regulation, investment banks are authorised to undertake a range of activities, including investment management, product structuring, securities portfolio management, investment research and advisory services relating to listed securities, and issue management. The Regulation also permits investment banks to act as underwriters for issuances approved by the FSA.

Al Mamari further explained that the legislator prohibits commercial banks from carrying out the activities regulated under the Law and its Executive Regulation except through an entity that is legally independent from the bank. However, commercial banks are permitted to combine their licensed banking activities with custody and trust services and underwriting activities.

He also noted that the Regulation revises the existing legislative framework governing crowdfunding activities following an assessment of the sector’s performance during its initial phase. The amendments are intended to support the continued growth of crowdfunding as an innovative source of finance for small, medium-sized and micro enterprises in the local market.

Risk-based supervision

Al Mamari said that the Executive Regulation clearly defines the regulatory goals and operational risks applicable to the institutions and entities subject to its provisions, while allowing them to take the necessary measures to achieve those goals and mitigate such risks under the supervision of the FSA.

He explained that the Regulation reinforces a risk-based supervisory approach through provisions relating to capital adequacy reporting, the management of market, credit and operational risks, business continuity planning and other prudential requirements.

Al Mamari added that the Regulation also introduces a revised fee structure for services and activities within the capital market sector, striking a balance between regulatory requirements, reducing the compliance burden on regulated entities and enhancing the competitiveness of the market.

In addition, it establishes a framework for the regulation and registration of local and international credit rating agencies in the Sultanate of Oman. This is expected to strengthen the country's credit rating ecosystem, promote the localisation of expertise and knowledge in this field, enhance the credibility of credit assessments in the Oman’s market, improve risk assessment practices, and support investors and decision-makers.

Fin-Tech innovation

Al Mamari also noted that the Regulation authorises the FSA to license financial technology (Fin-Tech) services and activities involving innovative financial instruments that are not yet governed by specific legislation, through a regulatory sandbox operating under flexible criteria established by the FSA in line with market requirements and the evolving nature of such products.

He said that this approach is expected to encourage innovation, support the development of digital solutions and attract investment in financial technology relating to securities activities, while maintaining market integrity and stability and ensuring the protection of market participants.

The Executive Regulation comprises seven chapters covering the various aspects of capital market regulation. Chapter I sets out the definitions and general provisions governing the application of the Regulation. Chapter II covers capital market institutions, including their licensing requirements, responsibilities, regulatory obligations, and supervisory framework. Chapter III addresses entities operating in the securities sector, including their licensing requirements, permitted activities and obligations. Chapter IV regulates credit rating agencies and the requirements governing their activities. Chapter V covers collective investment schemes, including their establishment, management, governance arrangements and service providers. Chapter VI sets out the obligations of issuers, including disclosure requirements and the provisions governing market integrity. Chapter VII establishes the Grievances Committee and regulates the procedures for appealing decisions issued by the FSA, its Board Chairman or its Executive President, as well as the mechanism for considering and determining such appeals.

The Executive Regulation has been issued pursuant to the Securities Law promulgated by Royal Decree No. 46/2022, Royal Decree No. 20/2024 establishing the Financial Services Authority and issuing its Statute, together with the relevant legislation and regulatory instruments governing the capital market and real estate investment funds.