Riyadh- Saudi Arabia has come one step closer to increasing Small and medium-sized enterprises (SMEs) contribution to local economy.

SMEs make up to 70 percent of global economies– the notable support being invested in SMEs comes in line with the Saudi post-oil era vision, Kingdom’s vision 2030.

SMEs enlisting at the secondary stock market has been easier; a new drafted rule states that a SME has to document a year of financially activity only before being enlisted into the secondary market.

Those firms wanting to list on the SME market must have financial records and been operating for at least one year. Firms wishing to list on the main market must have a minimum of three years of accounts.

Transitioning to the main indices is possible after a minimum of two years listing on the second market, the document added.

No indication was given in the draft rules of whether small companies already traded on the existing bourse would be allowed to transfer to the second market.

Small-cap firms are among the most heavily traded on the Saudi exchange as they are targeted by retail investors aiming to make a quick profit.

A consultation process for the draft rules will now run until Nov. 14, according to the stock market announcement of the draft rules.

More so, Saudi Arabia’s Capital Market Authority, in a part of its continuous efforts to develop the capital market, regulate the issuance of securities and monitor securities and dealing in securities, announced publishing the draft Second Market Listing Rules (“the Rules”) on the body’s official website.

The Rules aim to regulate the offering, registration and admission to Listing of shares in the Second Market, as it includes the conditions registration and admission to Listing in the Second Market and identifies the investors eligible to invest in it.