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Violating Behaviours

The Market Supervision Division is responsible for monitoring the trade and primarily deals in securities, while also monitoring the electronic channels and websites to ensure that there are no unlawful acts or practices against Capital Market Law and its implementing regulations. The Division also responsible to ensure that Listed Companies, Board of Directors, Senior Executives and Substantial Shareholders comply with the continuous disclosure requirements and any instructions or directives issued by CMA. In addition to this, it also ensures the Listed Companies compliance with requirements of the Corporate Governance Regulations.

The Division's roles and responsibilities are as follows:

  1. Monitoring of trading transactions and conducting preliminary reviews to ensure a full compliance of the participants under the Capital Market Lawand its Implementing Regulations. This is mainly to protect Investors and traders against any unfair or deceptive acts or practices through advanced surveillance systems and tools.
  2. Monitoring of electronic channels for any acts or practices against Capital Market Law and its implementing regulations.
  3. Monitoring compliance of listed companies’ compliance with the continuous discloser requirements. This includes listed companies annual, quarterly and non-current continuous obligations and review of financial reports to ensure the discloser’s adequacy and fairness.
  4. Ensure that Board of Directors, Senior Executives and Substantial shareholders comply with discloser requirements stated in CMA’s regulations.
  5. Ensuring that the compliance of listed companies is in line with the requirements of the Corporate Governance Regulations.  
  6. Establishing the culture of corporate governance by enhancing awareness of best practices.

 The Market Supervision Division consists of three departments as follows:  

The Continuous Disclosure Department:

The Continuous Disclosure Department is responsible for following up and supervising listed companies in order to ensure the best practices of disclosure and transparency in the capital market.  The Department undertakes the promoting of disclosure and transparency of listed companies and investors. The department has contributed in many developments with regard to regulations and procedures for disclosure of listed companies and is still working to promote and improve their procedures and regulations. 

The main functions of the Department include: 

  • Monitoring of announcements developed by listed companies on the website of The Saudi Stock Exchange (Tadawul).
  • Monitoring of disclosure forms.
  • Monitoring ownership activities of Board Members, Senior Executives and major Shareholders of listed companies.
  • Monitoring investment activities of listed companies in the capital market.
  • Reviewing the annual and interim financial statements of listed companies.

 Surveillance Department:

The Surveillance Department is responsible for monitoring trade operations by using daily analysis for the market trades, writing periodic reports, and using the latest surveillance systems in the global market. The goal is to ensure compliance of the capital market participants to CMA rules and regulations , in order to regulate the market and provide the necessary protection to investors.

 The processes of market surveillance are as follows:

  • Analyzing market trades on a daily basis and writing reports of all unusual behavior that occurred to it. 
  • Extensive research is conducted on all transactions through the analysis of market data and executed orders.
  • The monitoring system (SMART) issues alerts about any practices or transactions may be suspected of being in violation of the capital market law and its regulations.
  • After analyzing the alerts, a report of any suspected violation of the Capital Market Law and its Implementing Regulations must be prepared, and forwarded to the concerned department in Capital Market Authority to investigate the issue and take necessary decisions on it.
  • A surveillance inquiry (soft enforcement) will take place for any conduct or practice suspected of violating the Capital Market Law and its regulations.
  • Screening electronic media channels to ensure that there is no practices or acts that violate the Capital Market Law and its Implementing Regulations.

 Corporate Governance Department:

The Corporate Governance Department is responsible for mentoring listed companies with corporate governance regulations in order to ensure strict adherence to best corporate governance practices that protect the rights of shareholders and the rights of stakeholders. The Department has developed many goals that will help to gain access to implementing the best corporate governance practices of listed companies, such as:

  • Increase the awareness of listed companies with the corporate governance regulations and good governance practices, while promoting a culture of good governance with listed companies in the Capital Market.
  • Promote the concepts of transparency, responsibility, and fairness in addition to raising the awareness of investors regarding good governance.
  • Enhance communication with professional international and local organizations related to corporate governance as well as institutional investors in order to introduce and develop corporate governance practices in the Kingdom.
  • Develop clear and effective procedures to the department to oversee the governance practices of listed companies in the capital market, which ensures the protection of investors in the capital market.
  • Encourage self-enforcement of good practices of corporate governance and promote a culture of governance in listed companies through the continuous communication.
  • Develop and use appropriate tools to ensure the effective application of the statutory requirements for corporate governance.