Market infrastructure - Israel
Institutions and organisation
Stock Exchange - Tel Aviv Stock Exchange (TASE)
The TASE provides trading in equities, corporate bonds, convertible bonds, government bonds and Treasury bills and derivative options via its Tel Aviv Continuous Trading (TACT) system. TASE is also the national numbering agency and a member of the Association for National Numbering Agencies (ANNA). TASE acts as a central counterparty for all on-market equity and fixed-income transactions.
CSD - Tel Aviv Stock Exchange Clearing House Ltd (TASE-CH)
The TASE-CH is a department of the TASE (see above) and is located on its premises. The TASECH is responsible for the clearing of all market instruments except options. Options and derivatives are cleared via the MAOF Clearing House, also a department of the TASE but a separate legal entity. The TASE-CH settles trades between accounts maintained by its participants only and, consequently, most TASE brokers maintain accounts at the TASE-CH.
Central Bank - The Bank of Israel (BoI)
The BoI is in charge of regulating fund transfers through the Zahav real-time gross settlement (RTGS) payment system. Cash payments related to TASE transactions are cleared on a net basis between members’ accounts opened on the books of the BoI. Zahav operates on the basis of the IBAN standard.
Regulatory structure
The following bodies are the regulators of the Israeli securities and financial markets:
- For the banking sector and Zahav, supervisory functions are performed by the BoI and the Israel Money Laundering Prohibition Authority (IMPA), a department of the Ministry of Justice, whose responsibilities are established under the Prohibition on Money Laundering Law dated 2 August 2000. The IMPA does not have specific powers to prosecute, but monitors cash payment activities in order to gather evidence for law enforcement authorities.
- For the capital markets sector, the Israeli Securities Authority (ISA) is the regulatory and supervisory authority in charge of regulating the TASE and is also responsible for protecting the interests of stock exchange participants. In addition, the TASE is regulated by the “Rules of the Exchange”, which are approved by the Ministry of Finance and the Finance Committee of the Israeli Parliament (the Knesset).
- The Ministry of Finance is responsible for overseeing government debt issues and trading activity as carried out by the TASE.
- The TASE performs a number of self-regulatory tasks, including:
- The TASE Department of Economics is responsible for examining and approving security listing applications, providing economic research and data on all listed companies;
- The TASE Comptroller is responsible for monitoring trading activity on the stock exchange, examining irregular activities, auditing TASE members and providing internal control over TASE operations.