On 25 March 2021, SAU Tad amended short sale, securities borrowing rules.
- Saudi Stock Exchange (SAU Tad) and Securities Depository Center Company (EDAA) issued amended short selling and securities borrowing and lending (SBL) regulations.
- Also amended the Exchange and Centre Procedures and glossary of exchange rules.
- Follows February 2020 consultation with draft amendments to the regulations.
- ISLA engaged directly with the exchange to discuss legal and accounting structures.
- Allowed all types of investors to conduct short selling and securities borrowing and lending activities with specific conditions; amended criteria, requirements to activities.
- Imposed new limits on eligible listed securities for short selling, including short ratio to average daily traded volume of the security (last 60 days), must not exceed 10 days.
- Also amended SBL provisions relating to return of borrowed securities and collateral.
- Where failed to return borrowed securities or collateral as per terms of SBL agreement, custody member to notify the Depository Centre, which will terminate SBL transaction.
- The rules, procedures and the glossary became effective on 25 March 2021.