Population: 5.1 million

Wealth in domestic bank deposits: 58 billion USD (March 2023)

Offshore expatriated wealth: 9.2 billion USD

Main offshore banking locations: N/A

Number of individual brokerage accounts: N/A

Crypto adoption (% of population): N/A

TLDR

Oman has a business-friendly environment and open economy with no restrictions on foreign investment or capital flows. The regulatory framework governing banking, foreign exchange, and investments continues to evolve based on international standards. Recently, there have been promising developments regarding cryptocurrency regulation, with a comprehensive framework proposed to regulate digital assets and provide legal clarity. The securities market is also expanding with a new law broadening available investment options. While explicit classifications are lacking, regulations suggest retail offers target individual investors while institutional ones cater to professional entities based on predefined categories. More clarity is expected as additional laws and regulations are implemented.

Exchange controls

Oman imposes no restrictions on capital movements into or out of the country and follows a long-standing currency peg to the US Dollar. Foreign exchange is easily obtainable, and repatriation of profits, savings and investments encounters no delays or barriers. Oman has demonstrated commitment to countering money laundering and terrorism financing as a member-country of the Financial Action Task Force.

Distribution rules for foreign investment products

The main regulation governing marketing and sale of foreign securities in Oman is the Capital Markets Law (Royal Decree 80/98) (the “CMAL”) and the Executive Regulations of the Capital Markets Law Decision No. 1 of 2009 (the “Executive Regulations”).

Despite the restrictive definition of “Securities” in the CMAL, in practice the Capital Markets Authority (the “CMA”) regulates any investment product, including derivatives and other instruments, offered or marketed in Oman.

Article 117 of the Executive Regulations prohibits offering or marketing non-Omani securities in the country without CMA approval. It provides that marketing and sale of such securities should be conducted by a locally registered company licensed by the CMA, with “marketing of foreign securities” explicitly stated in the license.

The regulations also outline conditions for foreign securities distribution including:

• Limiting marketing and advice to regulated securities
• Providing investors information like prospectus, amendments, due diligence reports
• Submitting biannual reports to CMA on distributed securities
• Refraining from fraudulent/deceptive promotion or concealing material information
• Avoiding media use for promotion
• Targeting financially capable, experienced investors
• Obtaining investor acknowledgment of risks
• Setting minimum initial investment at OMR 5,000
• Maintaining investor registers with related documents

In summary, foreign issuers must appoint CMA-licensed local brokers to distribute securities in Oman on their behalf, while adhering to transparency, reporting and investor protection requirements. The new Securities Law offers expanded investment vehicles, with its executive regulations expected to provide additional clarity.

Qualified investors

Omani regulations distinguish between retail and institutional investment offers. Retail promotes individual ownership for non-professional investors. Institutional targeting is undefined but focuses on professional entities like insurance firms or investment banks based on predetermined categories. All offers require issuing a CMA-approved prospectus. While explicit qualified investor status akin to other jurisdictions is lacking, the differential distribution rules and restrictions suggest an implicit segmentation of investors based on sophistication and capability to understand complex products. Further classifications may emerge under forthcoming regulations.

Cryptocurrency regulation

As of 2023, Oman’s financial regulator has prepared a extensive framework to regulate cryptocurrencies, digital assets and virtual asset service providers (VASPs), spanning areas like licensing, capital requirements, custody rules and token issuance guidelines. This balances innovation aspirations with risk management objectives. The proposal is still awaiting finalization and implementation after industry feedback. The shift represents a notable change from previous considerations to ban cryptocurrencies and aims to provide legal clarity to promote virtual asset adoption.