Muscat – The Financial Services Authority (FSA) has issued the Executive Regulation of the Securities Law, introducing a comprehensive legislative framework aimed at modernising Oman’s capital market, strengthening investor protection, supporting financial innovation and enhancing the sector’s role as a key source of financing for the national economy.

Approved by H E Dr Khamis bin Saif al Jabri, Chairman of the FSA Board of Directors, the regulation provides the detailed rules required to implement the Securities Law promulgated under Royal Decree No 46/2022.

The regulation is intended to strengthen the legislative and regulatory framework governing the securities sector, enabling capital market institutions to keep pace with rapid developments in financial technology and innovative financial instruments.

It also places considerable emphasis on expanding competitive financing options within the economy and enhancing regulatory flexibility to attract both domestic and foreign capital into the capital market. This is expected to support economic activity while strengthening investor confidence through greater fairness, integrity and transparency, the FSA said in a statement.

The Executive Regulation will come into force on the day following its publication in the Official Gazette dated July 26, 2026. The FSA’s Executive President has been authorised to issue the instructions, forms and circulars required to implement its provisions. Until then, the existing instructions, forms and circulars will remain in force, provided they are not inconsistent with the Securities Law or its Executive Regulation.

The decision also requires capital market institutions and entities operating in the securities sector to regularise their status within six months of the regulation coming into force. Licensed banks carrying out securities-related activities have been granted a transitional period of up to three years to transfer such activities to a legally 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 operations under Article II of the regulation.

Structural transformation of capital market

Ahmed bin Ali Al Mamari, Vice Executive President of the FSA, described the Executive Regulation as a major milestone in the development of Oman’s capital market. He said it follows a comprehensive review of the sector’s legislative framework aimed at positioning the capital market as one of the principal sources of financing in support of Oman Vision 2040.

Speaking to Oman News Agency (ONA), Al Mamari said the regulation represents a structural transformation of Oman’s capital market by introducing detailed provisions governing capital market institutions and other entities operating in the securities sector, including minimum capital requirements and regulatory obligations.

One of the most significant reforms is the introduction of investment banking as a regulated activity. The new framework will enable investment banks to play a greater role in supporting the primary market and improving market liquidity.

Under the new regulation, investment banks will be authorised to undertake a wide range of activities, including investment management, product structuring, securities portfolio management, investment research, advisory services relating to listed securities and issue management. They will also be permitted to act as underwriters for issuances approved by the FSA.

Al Mamari said the legislator prohibits commercial banks from carrying out activities regulated under the Securities Law and its Executive Regulation except through a legally independent entity. However, banks may continue to combine their licensed banking activities with custody and trust services as well as underwriting activities.

The regulation also revises the legislative framework governing crowdfunding activity after a review 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

To strengthen regulatory oversight, Al Mamari said the regulation adopts a risk-based supervisory approach through provisions covering capital adequacy reporting, the management of market, credit and operational risks, business continuity planning and other prudential requirements.

The regulation also introduces a revised fee structure for services and activities in the capital market sector. According to the FSA, the new fee regime is designed to balance regulatory requirements with lower compliance costs for market participants while enhancing the overall competitiveness of Oman’s capital market.

In addition, the regulation authorises the FSA to license financial technology (fintech) services and activities involving innovative financial instruments that are not yet covered by specific legislation through a regulatory sandbox operating under flexible criteria established by the authority in line with market requirements and the evolving nature of such products.