Trading is a fairly straightforward industry that does not require a lot of red tape maneuvering or resources to get started. But that’s if you’re dealing with some of the best stock brokers in the UK and other similar regions like the US and other parts of Europe. However, things are pretty different once you make your way to the sandy desert that’s the Middle East.
Trading legally in Saudi Arabia is easier said than done. The laws and perceptions about money and trading are different, not to mention the Islamic laws you also have to contend with. Nonetheless, legally trading in the Middle East is still possible, and we will highlight a few ways you can achieve it. So keep reading to learn more.
Get an Iqama From Saudi Arabia
Saudi Arabia is the largest Arab state and one of the most influential in the region as well as on an international level. It is home to approximately 34.8 million people, with an estimated local population of 3 million. That’s a lot of foreigners to accommodate and keep track of. However, Middle Eastern countries use the Iqama to track foreign hires.
An Iqama is Saudi Arabia’s version of a residency permit issued to people who arrive in the country on a work visa. You also need a local sponsor or employer to sign off on your permit to get one. Once you get your Iqama, you can legally work and even access the trading markets in the country.
Open a Tadawul Account
Once you can legally work and trade in the country, you will need a local trading account to access the markets. Fortunately, taking part in an IPO or buying and selling stock on the Tadawul, Saudi’s version of the stock exchange is not as complicated as you’d expect. It begins with identifying an IPO; it really doesn’t matter which; it’s just how their process is.
Once you have identified one, buy any number of shears from the IPO from your Middle Eastern bank account and wait. You will receive an SMS from your bank after a few days informing you of the status of the shares you bought. This also means your Tadawul account with the Saudi stock market is ready, and your shares have been deposited.
However, you still need to activate it by logging on to your bank account, selecting your Tadawul portfolio under investments, and clicking register. Read the terms and conditions before accepting them and remember to note your account number, then enter your Iqama number to complete the process. You’re all done and can conveniently buy and sell shares on the Middle Eastern stock exchange.
Have a Registered Trading Company in Saudi Arabia
Another way to get your Iqama if you’re not going to Saudi Arabia as an employee is to register your own trading company with the country. A local trading company’s license is enough to get you an Iqama number and make navigating the local trading circles easier. Setting up a company in the country is also not as complicated as you’d expect.
You will first prepare your Saudi company’s memorandum and Articles of association, along with your and other shareholders’ identification papers. Provide your Office address and fill out the Saudi trade register’s identification documents. Next, open your company’s bank account with one of the local banks and register with the tax authorities to obtain a VAT number.
Finally, obtain any business licenses required to run a trading company in the country. After your company is all set up and you receive your Iqama number, follow the previous steps we highlighted to get you a trading account with Tadawul.
Use International Brokers
Attaining an Iqama and going through the Tadawul registration process can be daunting for many people. However, that is not to say there are no accessible alternatives. International trading platforms, such as IG Markets, are licensed to operate in the Middle Eastern market, and you can use them for your trading.
Some offer a Saudi-specific app, while others integrate the country’s trading instruments into their existing platforms. In any case, they will significantly make trading legally in the Middle East more convenient and manageable, even for most beginners.
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