This summary was compiled by Abdulrahman Sami Al-Jandal and reflects the regulatory requirements as of 18 August 2023, based on the Tadawul Listing Rules, the Capital Market Authority’s Rules on the Offering of Securities and Continuing Obligations, the Companies Law, and the Corporate Governance Regulations.
Introduction
The Nomu – Parallel Market provides an alternative platform for companies seeking to list their shares under regulatory requirements that are less restrictive than the Main Market, yet still designed to ensure transparency, governance, and investor protection.
This article presents a clear and structured overview of the principal conditions for listing on Nomu, including Tadawul requirements, CMA offering requirements, key Companies Law provisions, and governance obligations applicable to listed companies.
1. Listing Requirements Under Tadawul’s Nomu Listing Rules
| Subject | Requirement | Article |
|---|---|---|
| Minimum number of shareholders | At least 50 shareholders | Art. 41(b) |
| Public ownership requirement | 20% of share capital, or SAR 30 million—whichever is lower | Art. 41(b) |
| Market capitalization requirement | SAR 10 million for companies offering shares SAR 100 million for direct listing |
Art. 41(b) |
| Financial advisor | Appointment required | Art. 43(a) |
2. Listing Requirements Under CMA’s Rules on the Offering of Securities and Continuing Obligations
| Subject | Requirement | Article |
|---|---|---|
| Financial advisor | Must be appointed | Art. 90 |
| Legal advisor | Appointment recommended (optional) | Art. 90 |
| Offering approvals | All approvals required under the company’s bylaws and relevant laws must be obtained | Art. 91 |
| Legal structure | Must be a joint-stock company | Art. 92 |
| Operating history | At least one financial year of business activity prior to filing the application | Art. 92 |
| Financial statements | Audited financial statements for one financial year by a CMA-licensed audit firm | Art. 92 |
| Supporting letters | Submission required | Art. 93 |
3. Key Companies Law Provisions Relevant to Joint-Stock Companies and Their Listing
| Subject | Requirement | Article |
|---|---|---|
| Shareholder liability | Limited to the value of shares subscribed | Art. 58 |
| Minimum capital | SAR 500,000 | Art. 59 |
| Paid-up capital | At least one-fourth of issued capital must be paid | Art. 59 |
| Documents required upon incorporation or conversion to a joint-stock company | Founders’ information; statement of expected expenses; founders’ subscription declaration; capital deposit certificate; board appointment; auditor appointment (if applicable); commitment to legal requirements; valuation report for in-kind contributions | Art. 61 |
| Board composition | Minimum of 3 directors | Art. 67 |
| Board term | Maximum of 4 years | Art. 68 |
| Board meetings | Minimum of 4 meetings per year | Art. 80 |
| Disposal of shares prior to listing | A general assembly resolution is required for approval of direct listing (share disposal provisions) | Art. 85 |
| Ordinary general assembly meetings | Held at least once a year | Art. 88 |
| Flexibility of notice periods | Notice periods may be waived if the company is non-listed, provided quorum requirements are met | Art. 91 |
| Ordinary general assembly quorum | At least one-quarter of voting shares represented | Art. 92 |
| Extraordinary general assembly quorum | At least half of non-voting shares represented unless the bylaws specify a higher quorum; maximum threshold is two-thirds | Art. 93 |
| Sole-shareholder joint-stock companies | All powers are exercised by the sole shareholder through written resolutions | Art. 98 |
4. Governance Requirements for Companies Listed on the Nomu Market
| Subject | Requirement | Article |
|---|---|---|
| Application of Corporate Governance Regulations | Governance Regulations are generally advisory for Nomu-listed companies, except for mandatory provisions relating to: – General assembly procedures (Art. 13(c)) – Committee meeting validity (Art. 50(b)) – Audit committee requirement (Art. 51(a)) – Duties of the audit committee (Art. 52) – Audit committee authorities (Art. 56) – Audit committee report (Art. 88) | Preamble, Art. 2 |
Conclusion
The Nomu – Parallel Market offers companies an accessible platform for listing while maintaining essential requirements that ensure market integrity, transparency, and investor confidence. Understanding these obligations is critical for companies seeking admission to the market and for aligning their internal processes with regulatory expectations.
Organizations preparing for admission to the Nomu – Parallel Market are encouraged to ensure full compliance with the applicable regulatory, financial, and governance requirements.
Our advisory team is available to provide professional guidance and support throughout the listing process.