Article 53 of the Saudi Capital Market Law

After Article 52 directed the Authority to issue rules regulating restricted share purchases and restricted share offers, and defined them by reaching 10% or more of listed voting shares, this article clarifies what that power includes. It states expressly that what it mentions is not exhaustive. It includes:

1. Adjusting the percentages set in Article 52, and approving exceptions to the definition of restricted purchase and restricted offer.
2. Specifying the timing of publication of announcements relating to these operations on the Market, and their form and manner.
3. Specifying the information that the buyer of the shares and the offeror must disclose, and the manner of disclosure, including any requirements for continuing disclosure of changes in share ownership.
4. Imposing conditions or requirements on the target company, meaning the one whose shares are the subject or target of a restricted purchase or restricted offer, concerning the announcement of its position on the purchase or offer or its view of it.
5. Any other rules relating to these operations as the requirements of the soundness of the market and the protection of investors call for.

The practical importance of this article is that the 10% figure in Article 52 can be adjusted by the Authority's rules, and that the details of announcement, disclosure and the target company's duties are not found in the law itself but in the rules the Authority issues. A person buying an influential stake or making an offer, as well as the board of the target company, should consult those rules. For these operations, consulting a lawyer specializing in securities and capital markets is advised.