Securities Disputes

Securities Disputes

Our litigation team has substantial experience acting before the Capital Market Authority’s (“CMA”) Committee for Resolution of Securities Disputes (“CRSD”), at both first instance and appellate levels, including acting for a defendant in the first ‘class action’ to be filed in the Kingdom of Saudi Arabia under the CMA’s new regulations permitting class actions, a case which involves over 300 claimants.

The judicial committees of the Committee for the Resolution of Securities Disputes (“CRSD”) and the Appeal Committee for the Resolution of Securities Conflicts (“ACRSC”) have jurisdiction in relation to securities disputes. In 2003, the Capital Market Law (“CML”) authorized the CMA to establish these committees, and their jurisdiction extends to the disputes falling under the provisions of the CML, its implementing regulations, and rules and instructions issued by the CMA and the Saudi Stock Exchange concerning both public and individual actions. In addition, the CRSD has jurisdiction over claims against decisions and actions issued by the CMA or the Saudi Stock Exchange.

The CRSD’s connection to the CMA means that it is more likely to uphold arrangements that it considers to be customary or internationally-recognized practice in the global securities markets. The CMA intends to improve the efficiency of both the CRSD and the ACRSC by reducing the average length of the dispute resolution process for securities disputes to nine months by 2020 (such period was 14 months in 2018). The introduction of an electronic system for cases, including the filing of claims and making official notifications to the parties, should aid this time-frame.

CRSD litigation has recently developed a critical distinction between actions that are essentially criminal in nature, which must be litigated by the Bureau of Public Prosecution as claimant at the CRSD, and actions that constitute non-criminal violations.

Our securities disputes experience includes disputes over:

  • Trading;
  • Commissioning;
  • Forex trading;
  • Short selling;
  • Unauthorized buying and selling;
  • Technical system error and command suspensions;
  • Refusal of investment capital;
  • Disputes over investment funds;
  • Mismanagement; and
  • Investment portfolios and money market irregularities, such as market manipulation, insider trading, publishing misleading information and data, and unauthorized dealing.