FEDERATION OF EURO-ASIAN STOCK EXCHANGES
SEMI ANNUAL REPORT OCTOBER 2006
MUSCAT SECURITIES MARKET
Ahmed Saleh Al-Marhoon
Director General
We are consciously working on developing
and operating an efficient and transparent
securities market to the best standard
expected by our local and foreign investors.
We believe that exchanges that adhere to
good governance, greater transparency and
greater accountability, are able to foster
investors’ confidence as well as creating an
attractive investment environment.
We at Muscat Securities Market (MSM),
however, have devised a comprehensive
road map that enables us to build capacity
and promote sustainable capital market
HISTORY AND DEVELOPMENT
The MSM was established by Royal Decree
issued on 21 June 1988 to regulate and
control the Omani securities market and to
participate, effectively, with other
organizations for the setting up of the
infrastructure of the Sultanate’s financial
sector.
After ten years of continuous growth there
was a need for a better functioning of the
market. The MSM has been restructured by
two Royal Decrees (80/98) and (82/98).
Royal Decree (80/98) dated 9 November
1998, which promulgated the new Capital
Market Law, provides for the establishment
of two separate entities: an exchange– the
Muscat Securities Market (MSM)– where all
listed securities will be traded, and the
Capital Market Authority (CMA)– the
regulatory body. The exchange is a
governmental entity, financially and
administratively independent from the
regulatory body but subject to its
supervision. Thus the securities industry in
Oman is well established to enhance
investors’ confidence by developing and
improving all the processes pertaining to the
stock market.
PAGE 114
We believe that exchanges that adhere to
good governance, greater transparency and
greater accountability, are able to foster
investors’ confidence as well as creating an
attractive investment environment.
development strategy specifically aimed at
improving access to the regional and
international capital markets.
In view of the above, MSM recently revised
its legislation with respect to listing, trading
and clearance and settlement regulations to
enable MSM to cater for our market demand.
One of our eminent projects is to replace the
MSM existing trading system with Atos-
Euronext Trading System that is used by
some western and other emerging stock
markets.
There are recent amendments to the Capital
Market Law and its executive regulation,
which aim at enhancing the efficiency and
transparency as well as securing the
integrity of the market. The recent enactment
of the code of corporate governance and
other rules and regulations, during the
current year, has a clear effect on the
investors’ confidence on the market and is
positively reflected in the market index
movement.
FUTURE OUTLOOK
As part of the future vision for the
development of activities of the market in
2005, MSM appointed a specialized
company to study and evaluate the market
in order to draw up a methodological vision
for its development as per a specific
timetable extending from 5-10 years. The
task was entrusted to Atos-Euronext which is
specialized in financial consultancy, trading
system and electronic solutions. It is
currently implementing the new electronic
trading system at the market. It is a leading
company and very well known for its vast
practical experience as it is closely linked
with Paris Stock Exchange. It also provides
consultancy services to leading European
We expect that the new trading system will
be implemented at the end of 2005 and will,
inevitably, enhance the capability of MSM
and make it the first exchange in the GCC
countries that uses this advanced trading
system.
We are in the process of upgrading MSM
website to improve the navigation, content
and overall value of the website for users.
stock exchanges. The market will start to
implement part of the recommendations and
proposals of the study in 2006 and as per a
fixed time frame.
The market has already established an
action plan for the year 2006. The plan aims
at developing work at the market to cover all
technical, technological, legislative, and
informational and awareness areas. It also
aims at developing MSM relationships with
other financial markets either to achieve
electronic links or to exchange information
and experiences.
The Action Plan envisions the need to match
the new electronic trading system with the
requirements of the market after receiving
it from the implementing company. It also
aims at the implementation of a program
that allows for Internet trading as well as the
completion MSM connection with Abu Dhabi
and Dubai markets.
MSM hopes to open a new branch in Sohar
and intensify information and media
awareness program inside and outside the
Sultanate, and update trading laws to keep
pace with international developments.