Securities (Electronic Signature and Reporting) Regulations, Chapter 1: Interpretation

Transcription

1 The translation is intended solely for the convenience of the reader. This translation has no legal status and although every effort has been made to ensure its accuracy, the Authority does not assume any responsibility whatsoever as to its accuracy and is not bound by its contents. Only the original Hebrew text is binding and reader is advised to consult the authoritative Hebrew text in all matters which may affect them. Securities (Electronic Signature and Reporting) Regulations, By virtue of my authority under sections 44D(a) and 55A of the Securities Law, (hereafter the Law), section 131(a) of the Joint Investment Trust Law, (hereafter the Joint Investment Law) and section 42 of the Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management Law, (hereafter the Regulation Law), in accordance with a proposal of the Israel Security Authority and with the approval of the Finance Committee of the Knesset, I enact the following regulations: Definitions [Amended: 5765(2)] 1. in these regulations Chapter 1: Interpretation Reporting site the internet site of the Israel Security Authority (henceforth the ISA), to which the electronic reporting to the ISA is made [ filing.magna.isa.gov.il]; Distribution site the internet site of the ISA that is open for inspection by the public, where the reporting of the reporting entities can be seen [ Means of signature, electronic signature, secure electronic signature and electronic certificate as defined in the Electronic Signature Law; Reporting entity a reporting corporation, trustee of certificates of indebtedness, fund manager, fund trustee, fund liquidator, licensed corporation or underwriter; Hard copy reporting filing a document by delivering it personally or Accompanying page part of the reporting form, which is intended for entering data from the reporting document, and which is marked in its title as being an accompanying page ; 1 Kovetz HaTakanot (Collection of Regulations) 6235, 5763 (7 April 2003), p. 665 (see the commencement provisions in regulation 25) Amendments: Kovetz HaTakanot (Collection of Regulations) 6361, 5765 (17 January 2005), p. 330; Kovetz HaTakanot (Collection of Regulations) 6362, 5765 (18 January 2005), p. 332 [5765( 2)] Kovetz HaTakanot (Collection of Regulations) 6449, 5766 (29 December 2005), p. 303

2 Handwritten signature a signature in handwriting on a paper document; "Issuer" within the meaning thereof under Securities Regulations (Underwriting), Reporting form an electronic form that is used for the purpose of electronic reporting to the ISA, as it appears, on the reporting date, on the reporting site or the distribution site as an appendix to the Electronic Reporting Rules; Electronic Reporting Rules rules for registration, signature, reporting and distribution through MAGNA which the ISA has published under section 44E of the Law; Signature approver within the meaning thereof in section 44D( b) of the Law; MAGNA 2 (Electronic Fair Disclosure System) the ISA s computer system that is used for receiving and distributing reports of reporting entities; Authorized electronic signatory a person, who holds the office of a senior corporate officer, who was appointed by a reporting entity, in accordance with the provisions of Chapter 3, to act as the person it has authorized for electronic reporting to the ISA; Computer of a reporter a computer that is used by an authorized electronic signatory for the purpose of downloading reporting forms from the reporting site and carrying out electronic reporting to the ISA, and which complies with the hardware and software requirements as determined in the Electronic Reporting Rules, including a connection to the internet network; Fund manager, fund trustee and fund liquidator according to the meaning thereof in the Joint Investment Law; Document With regard to a reporting corporation, trustee of certificates of indebtedness and underwriter a draft prospectus, a prospectus whose publication has been permitted, a registration document and every report, opinion or approval included therein, and also every report, notice and any other document, except for an accompanying page, that must be filed with the ISA or with the Stock Exchange under the Law; 2 MAGNA is an acronym of the Hebrew expression נאות גילוי מערכת) (אלקטרונית which means Electronic Fair Disclosure System.

3 With regard to a fund manager, fund trustee and fund liquidator a draft prospectus, a prospectus whose publication has been permitted, and every report, opinion or approval included therein, and also any report, information, notice and any other document, except for an accompanying page, that must be filed with the ISA or with the Stock Exchange under the Joint Investment Law Trust Law ; With regard to a licensed corporation a report, notice and any other document that it is liable to file with the ISA or with the Stock Exchange under Section 27 of the Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management Law, , and also an application under section 10( b) of the aforesaid law; Trustee of certificates of indebtedness within the meaning thereof in Chapter 5A of the Law; Senior corporate officer within the meaning thereof under the Securities (Periodic and Immediate Reports) Regulations, , including a secretary of the reporting entity, and a legal adviser of the reporting entity; Fund within the meaning thereof under the Joint Investment Law; Reporting corporation including a corporation that reports under Chapter 5C of the Law; Licensed corporation within the meaning thereof under the Regulation Law; Ratifier of Signature Regulations the Securities (Ratifier of Signature) Regulations, Securities (Electronic Signature and Reporting) Regulations, Electronic signature on document [Amended: 5765(2)] Chapter 2: Approval and Signature on Reports 2. (a) A person whose signature is required on a document filed with the ISA shall authorize an authorized electronic signatory of the reporting entity to sign on his behalf and to report electronically to the ISA, by attaching the approved electronic signature of the authorized electronic signatory; if the signature of more than one person is required on that document, all the persons whose signature is required shall authorize, with the aforesaid authorization, only one authorized electronic signatory of the reporting entity; such authorization shall be signed by hand by everyone whose

4 signature on the document is required under any law, stating his name and position in the reporting entity or any other connection that he has with the reporting entity, and he shall attach thereto, as an integral part thereof, the text of the document with regard to which the authorization was given. (b) (c) If the authorized electronic signatory was authorized to sign personally on the document as sole signatory on behalf of the reporting entity under the provisions of any law, he shall sign the document by attaching his authorized electronic signature and shall report electronically to the ISA. Sub-regulation (a) shall not apply with regard to the following documents: (1) Report of an auditor, regarding financial statements of the reporting corporation, to the shareholders and a review of the accountant of the reporting corporation about interim financial statements; (2) Report of an auditor or a review of an accountant regarding financial statements attached to the financial statements of the reporting corporation; (3) Report of an auditor or a review of an accountant, pertaining to financial statements, attached to a transaction report under the Securities (Transactions between Listed Company and Controlling Shareholder therein) Regulations, ; or to an offer report under the Securities (Private Offering of Securities in a Listed Company) Regulations, ; (4) Report of an auditor pertaining to the annual report of an underwriter, and also a review of an accountant on the interim reports of the underwriter in accordance with the Securities (Underwriting) Regulations, ; (5) A confirmation of an accountant of the issuer, which is attached to a notice about an intention to publish a prospectus under section 12( d)( 4) of the Law, confirming the existence of what is stated in section 12( d)( 4) of the Law. (6) A report of an accountant on financial statements of a fund; (7) A certificate of an accountant under regulation 10(d) of the Joint Investment Trust (Equity and Insurance of Fund Manager and Trustee and Qualifications of Directors and Members of the Investment Committee) Regulations, ; (8) A report of an auditing accountant that is attached to the report of a licensed corporation under regulation 8(f) and (g) of the Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management Regulations (Equity and Insurance),

5 (d) A report or review as stated in sub- regulation (c) (hereafter accountant s report) shall be filed with the ISA by electronic reporting, but shall not be deemed to be signed with a secure electronic signature for the purpose of the Electronic Signature Law; the authorized electronic signatory making the electronic reporting shall declare on the appropriate reporting form that he has examined and verified that the accountant s report filed with the ISA is absolutely identical from the viewpoint of content, structure and form to the accountant s original signed report that was submitted to the reporting entity and is kept in its offices; an originally signed accountant s report shall be kept also at the office of the accountant. Declaration of accountant 3. (a) No later than three trading days after publication of financial statements on the distribution site, the accountant who signed the accountant s report shall file with the ISA a declaration in writing, in which he confirms that the accountant s report included in the financial statements, filed with the ISA and displayed on the distribution site, is identical from the viewpoint of content, structure and form to the accountant s report that was signed by him and transferred to the reporting entity; the accountant s declaration shall be filed with the ISA, at its office in Jerusalem, by personal delivery or by mail. (b) If an accountant s declaration is filed as stated in (a), the accountant s report filed with the ISA sub-regulation as stated in regulation 2(a) shall be regarded as the original, in every legal proceeding. Preservation of documents 4. If a document or accompanying page was reported electronically to the ISA under these regulations (a) A copy of the document or accompanying page that was reported electronically to the ISA shall be kept electronically at the head office of the reporting entity. (b) The authorization for the electronic signature as stated in regulation 2( a) shall be kept at the head office of the reporting entity.

6 Appointment of authorized electronic signatory [amended: 5765(2)] Chapter 3: Authorized Electronic Signatory 5. (a) A reporting corporation shall appoint at least two senior corporate officers to act as authorized electronic signatories on its behalf, for the purpose of electronic reporting to the ISA. (b) A trustee for certificates of indebtedness, fund manager, fund trustee, fund liquidator, licensed corporation or an underwriter shall appoint one or more senior officers to act as authorized electronic signatories on its behalf for the purpose of electronic reporting to the ISA. (c) If a fund liquidator is an individual, he may himself act as an authorized electronic signatory or appoint one or more authorized electronic signatories on his behalf, for the purpose of electronic reporting to the ISA. Registration of authorized Electronic signatory on MAGNA 6. (a) An application for registration of an authorized electronic signatory, of a reporting entity registered on MAGNA, shall be filed with the ISA by means of electronic reporting on an appropriate reporting form (hereafter registration application). (b) Notwithstanding what is stated in sub- regulation (a), the chairman of the ISA or an employee whom he has authorized for this, may permit, in special circumstances, the filing of the application for registration not by means of electronic reporting, on conditions that he shall stipulate. (c) If the ISA approves the application for registration, the person who is intended to act as authorized electronic signatory shall go to the offices of a signature approver when he has a valid approval of the ISA, and he shall identify himself before the signature approver and shall purchase means of signature and an electronic certificate for the purpose of electronic reporting to the ISA; the validity of the ISA s approval for the purpose of going to the signature approver as stated in this sub- regulation shall be for fourteen days from the date of giving the approval. (d) As long as the electronic certificate that the authorized electronic signatory purchased is valid, the authorized electronic signatory shall not purchase any additional means of signature or electronic certificate, and shall make no use of any additional means of signature or electronic certificate for that reporting entity for the purpose of electronic reporting to the ISA, but

7 (e) (f) he may renew the validity of an existing electronic certificate in his possession. If the validity of the approval given by the ISA to a signature approver is temporarily restricted under the Signature Approver Regulations, the validity of the electronic certificate issued by the signature approver shall not be affected, but it shall not be possible to renew the validity of an electronic certificate that expired at the said signature approver. If authorization granted by the ISA to a signature approver is cancelled, under the Signature Approver Regulations, the validity of the electronic certificate that was issued by that signature approver shall expire seven days after the cancellation, and no further use can be made of it as of that date. Cancellation of nomination or change of details of Authorized Electronic signatory 7. (a) If a reporting entity cancels the nomination of an authorized electronic signatory, it shall give notice of this to the ISA and to the signature approver who issued the electronic certificate to that authorized electronic signatory, no later than the date on which the cancellation comes into effect. (b) If a change occurs in the position of an authorized electronic signatory at the reporting entity or in the details that were reported with regard to the authorized electronic signatory as stated in regulation 6, the reporting entity shall give notice of this to the ISA no later than on the day on which the change comes into effect; if the authorized electronic signatory ceases holding office as a senior officer at the reporting entity, the reporting entity shall give notice to the ISA of the cancellation of his appointment as authorized electronic signatory, and to the signature approver of the cancellation of the electronic certificate. (c) Notice to the ISA as stated in sub- regulations (a) and (b) shall be filed by electronic reporting, but the chairman of the ISA or an employee whom he authorized for this purpose may, under special circumstances, permit the filing of said notice to the ISA by means other then electronic reporting, on conditions stipulated by the aforesaid persons. Duties of authorized Electronic signatory 8. (a) An authorized electronic signatory shall not attach his authorized electronic signature to a document and shall not report electronically to the ISA, until he has verified that one of the following exists:

8 (b) (c) (d) (e) (1) He is authorized by law to sign the document as the sole signatory on behalf of the reporting entity. (2) He is authorized as stated under regulation 2(a), by everyone whose signature on the document is required by the law, to sign the document on their behalf by means of his authorized electronic signature, and to report electronically to the ISA, provided that the document to which he attaches his authorized electronic signature and which he files, by electronic reporting, with the ISA is absolutely identical in terms of content, structure and form to the document, attached to the authorization as stipulated under regulation 2(a), and given to him for the purpose of electronic reporting to the ISA. The electronic reporting shall be made by the authorized electronic signatory by means of the most appropriate reporting form that appears on the reporting site at the time of the reporting, but the non- existence of an appropriate reporting form shall not detract from the reporting duties that apply to a reporting entity under the provisions of any law. If the reporting form includes an accompanying page, the authorized electronic signatory shall complete the details required on the accompanying page, verify that the details that he completed on the accompanying page match the details that appear in the document being reported by him electronically, sign the accompanying page electronically on behalf of the reporting entity and file the accompanying page together with the document being reported by him electronically to the ISA. The liability of an authorized electronic signatory as stated in subregulations (a) to (c) is personal liability, and he cannot exempt himself from his liability by authorizing another person to use his means of signature for the purpose of signing or reporting electronically to the ISA. This regulation does not detract from the provisions of any law, including provisions relating to the duties of the owner of means of signing and his liability. Method of electronic reporting 9. Entering the reporting site, downloading reporting forms, completing details in reporting forms and making an electronic reporting to the ISA shall be done in accordance with the Electronic Reporting Rules. Reception of electronic reporting 10. (a) A document that is reported electronically to the ISA shall be deemed to have been filed at the time when it is received by MAGNA, in accordance with the confirmation issued to the authorized electronic signatory who

9 (b) (c) (d) made the electronic reporting; such a confirmation shall appear on the reporting site and shall be sent to the electronic mail address of the authorized electronic signatory. A document that is reported electronically shall not be received and shall not be deemed to have been filed unless it successfully passed a reception test by MAGNA on the technical level; a document that does not successfully pass the reception test shall be rejected, along with the appropriate notice that will appear on the reporting site. If the electronic reporting is infected with a computer virus or a hostile code, which may cause damage or disruption to the ISA s computer or of computer material present on the ISA s computer, the reporting shall be rejected without being accepted by MAGNA, along with an appropriate notice that will appear on the reporting site. A temporary or permanent fault on the reporter s computer shall not constitute a justification for a delay or postponement in filing documents. Hyperlinks 11. A document reported electronically to the ISA shall not have hyperlinks to information inside the document or outside it, but a reporting entity may include in a document a hyperlink for the purpose of referral from a table of contents, if any, to the relevant sections in the document itself or for the purpose of a referral, if any, in the wording of the document to relevant sections in the document itself. Files 12. (a) A document attached as a file to a reporting form shall be prepared by means of software adapted for use with MAGNA, which can be used for creating files in the textual PDF format (Portable Document Format) that allows a text search to be made in the language in which the document was written. (b) Notwithstanding what is stated in sub- regulation (a), a document prepared by an external source for the reporting entity, where the reporting entity has no control or influence over the manner in which it is prepared, can be attached to the reporting form in non- textual (image) PDF format. (c) An electronic reporting shall not include video, audio or animation files, and it shall also not include pictures except for graphs, tables, a logo or emblem of the reporting entity.

10 Chapter 5: Reporter who is not a Reporting Entity Offeror that is not a reporting corporation 13. (a) An offeror in a purchase offer under the Securities (Purchase Offer) Regulations, which is not a reporting corporation, or an offeror which is not an issuer, obligated to submit a prospectus under section 15 of the Law and who is not a reporting entity (hereafter offeror), shall appoint an authorized electronic signatory as set out below: (b) (c) (d) (1) If the offeror is a corporation it shall appoint one or more senior corporate officers to act as an authorized electronic signatory on its behalf for the purpose of electronic reporting to the ISA with regard to the purchase offer; (2) If the offeror is an individual he may himself act as authorized electronic signatory or appoint one or more authorized electronic signatories on his behalf for the purpose of electronic reporting to the ISA with regard to the purchase offer. An application to register an authorized electronic signatory of an offeror on MAGNA shall be signed with a handwritten signature by the offeror or on his behalf and shall be filed with the ISA by personal delivery or by mail. Registration of the authorized electronic signatory of the offeror on MAGNA shall expire ninety days after approval of his registration; the ISA may extend the period of ninety days on conditions that it shall stipulate. The provisions of these regulations shall apply, mutatis mutandis, to an offeror, an authorized electronic signatory on his behalf and any document reported electronically by them. Corporation's initial offer or initial listing of its securities 14. (a) A corporation that wishes to offer its securities for the first time by means of a prospectus or a corporation that wishes to list its securities for the first time for trade on the Stock Exchange by means of a prospectus or by means of a registration document shall appoint at least two senior officers to act as authorized electronic signatory on its behalf for the purpose of filing documents by electronic reporting to the ISA. (b) An application to register authorized electronic signatories on MAGNA for a corporation as stated in sub- regulation (a) shall be signed on behalf of the corporation with the handwritten signature of the chairman of the board of directors and the general manager, or a director whom the board of directors authorized instead of one of these for the purpose of signing

11 (c) (d) the application, stating the names of the signatories and their positions in the corporation; the application shall be filed with the ISA at its office in Jerusalem by personal delivery or by mail. If securities of the corporation are offered to the public by means of a prospectus or are listed for trade on the Stock Exchange by means of a registration document, the corporation shall file with the ISA, within one trading day of the date of receiving the permit to publish the prospectus or of the date of publishing the registration document, as applicable, by means of electronic reporting, opening details forms as set out in regulation 21(b). The provisions of these regulations shall apply, mutatis mutandis, to a corporation as stated in sub- regulation (a), an authorized electronic signatory on its behalf, and every document reported electronically by them. Corporation that wishes to act as a fund manager, fund trustee or fund liquidator [amended: 5765(2)] 14A. (a) A corporation that wished to be approved for the first time as a fund manager or fund trustee and a corporation that has been appointed as a fund liquidator shall appoint one or more senior officers to act as authorized electronic signatory on its behalf for the purpose of filing documents by electronic reporting to the ISA. (b) An application to register an authorized electronic signatory on MAGNA as stated in sub- regulation (a) shall be signed on behalf of the corporation with a handwritten signature of the chairman of the board of directors and of the general manager or a director whom the board of directors authorized instead of one of the aforesaid for the purpose of signing the application, stating the names of the signatories and their position in the corporation; the application shall be filed with the ISA at its office in Jerusalem by personal delivery or by mail. (c) If an individual applies to act as a fund liquidator, he may himself act as authorized electronic signatory or he may appoint one or more authorized electronic signatories on his behalf for the purpose of filing documents by electronic reporting to the ISA; an application under this shall be signed by hand by the applicant and shall sub-regulation be filed with the ISA by personal delivery or by mail. (d) The provisions of these regulations shall apply, mutatis mutandis, to a corporation as stated in sub- regulation (a) or to an individual as stated in sub- regulation (c), as applicable, to an authorized electronic signatory on their behalf and to every document that is reported electronically by them.

12 Corporation that wished to be a licensed corporation [amended: 5765(2)] 14B. (a) A corporation that is interested in receiving a license under the Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management Law, shall appoint, before filing the application under section 5 of the aforesaid law, one or more senior corporate officers to act as authorized electronic signatory, on its behalf, for the purpose of filing documents by electronic reporting to the ISA. (b) An application to register an authorized electronic signatory on MAGNA as stated in sub- regulation (a) shall be signed on behalf of the corporation with a handwritten signature of the chairman of the board of directors and of the general manager or a director whom the board of directors authorized instead of one of the aforesaid for the purpose of signing the application, stating the names of the signatories and their position in the corporation; the application shall be filed with the ISA at its office in Jerusalem. (c) The provisions of these regulations shall apply, mutatis mutandis, to a corporation as stated in sub- regulation (a), to an authorized electronic signatory on its behalf and to every document that is reported electronically by them. Company that wishes to act as underwriter or trustee for certificates of indebtedness 15. (a) A company that wishes to act as an underwriter or trustee for certificates of indebtedness shall appoint one or more senior officers to act as authorized electronic signatory on its behalf for the purpose of filing documents by electronic reporting to the ISA. (b) An application to register an authorized electronic signatory as stated in sub- regulation (a) on MAGNA shall be signed on behalf of the company with the handwritten signature of the chairman of the board of directors and the general manager, or of a director whom the board of directors authorized instead of one of these for the purpose of signing the application, stating the names of the signatories and their positions in the corporation; the application shall be filed with the ISA at its office in Jerusalem by personal delivery or by mail. (c) The provisions of these regulations shall apply, mutatis mutandis, to a company as stated in sub- regulation (a), an authorized electronic signatory on its behalf, and every document reported electronically by them.

13 Fees Chapter 6: Viewing and Use of Information 16. (a) Entry into the distribution site and inspection of the information displayed on it is exempt from the payment of any fee. (b) For downloading data from the distribution site and saving it, a fee as set out in the schedule shall be paid; the download will be done subject to the provisions of regulation 17 and the fulfillment of additional conditions, in the manner provided for by the ISA. (c) The provisions of sub- regulation (b) shall not apply to the download of data from the distribution site which is on a reasonable scale or which is not intended for sale, presentation, distribution or its systematic transfer. Restrictions on distribution of information 17. (a) Raw, processed or partial data distributed other than by the ISA, on the basis of data that was downloaded under regulation 16(b), shall be the complete and sole responsibility of anyone who distributed it (hereafter distributor), and it shall state, prominently, that the distributed information is the liability of the distributor only, that the information may be partial or the result of processing data and that the complete and binding data is the data included in the reporting that was filed with the ISA and which appears on the distribution site. (b) Without detracting from the stated under sub- regulation (a), where an accompanying page is included in an electronic reporting, the distributor shall not distribute the accompanying page in the format and structure that the accompanying page was filed with the ISA, but the distributor may make use of the data appearing in the accompanying page, process it and publish it subject to what is stated in sub- regulation (a). Receipt of certified copies 18. (a) Every person is entitled to receive from the ISA a certified paper copy of the reporting that are open for inspection by the public on the distribution site. (b) A reporting entity is entitled to receive from the ISA a certified paper copy of any document that it filed with the ISA. (c) On behalf of actions and services that the ISA provides with regard to issuing certified copies of documents filed with it, a fee shall be paid as set out in the schedule.

14 Indexing 19. (a) Amounts set out in the first schedule will be adjusted on the first of January annually, (hereafter date of the adjustment), according to the rate of increase in the new index in relation to the base index (b) An amount that changes as aforesaid shall be rounded to the nearest new (c) shekel. The chairman of the ISA shall publish, in a notice in Reshumot, the text of the first schedule as changed in consequence of what is stated in subregulations (a) and (b). (d) In this section The index the Consumer Price Index published by the Central Statistics Bureau; The new index the index published most recently before the date of the change; The base index the most recent index published prior the previous date of change; while regarding the first date of change after the commencement of these regulations the index published most recently before the date of their commencement. Chapter 7: Transitional Provisions Initial registration of authorized Electronic signatories of reporting corporation 20. (a) During the period of fourteen days from the date which is stated in a notice under regulation 25( 1)( a) as the date for beginning the registration of authorized electronic signatories of a reporting corporation, a reporting corporation shall file with the ISA the details of the corporation and a written application for initial registration of its authorized electronic signatories on MAGNA; the application shall be signed on behalf of the reporting corporation with a handwritten signature of the chairman of the board of directors and of the general manager, or of a director whom the board of directors has authorized instead of one of these for the purpose of signing the application, stating the names of the signatories and their functions in the reporting corporation, and it shall be filed with the ISA at its office in Jerusalem by personal delivery or by mail. (b) If the ISA approved the application for registration as stated in subregulation (a), the person designated to act as authorized electronic signatory shall go to the offices of a signature approver, when he has in his possession a valid approval of the ISA, and he shall identity himself before the signature approver, and purchase a means of signature and an

15 electronic signature for the purpose of electronic reporting; the validity of the approval of the ISA for the purpose of going to a signature approver as stated in this sub- regulation shall be for fourteen days from the date on which the approval was given. Beginning of electronic reporting by a Reporting corporation 21. (a) Beginning on the date stated in the notice under regulation 25( 1)( b) as the date for beginning the assimilation period of a reporting corporation, a reporting corporation shall be liable to report electronically to the ISA under these regulations, simultaneously with, and in addition to, the hard copy reporting; in addition to this, the reporting corporation will be entitled to report electronically practice reporting if it so chooses; during this period the binding reporting will be only the hard copy reporting filed with the ISA. (b) On the date stated in the notice under regulation 25(1)( c) as the date for beginning the obligatory electronic reporting of a reporting corporation, a reporting corporation shall file by electronic reporting forms concerning its opening data (hereafter opening data forms), which include (1) Its documents of incorporation; (2) Details of its principal shareholders and their holdings; (3) Details of its senior officers; (4) Details of its registered shareholders; (5) Details of the registered capital, issued capital and its additional securities; (6) Details of the dormant shares in its capital; (7) Details of its auditing accountant. Opening data forms as stated in this sub- regulation shall all be filed on the same day. (c) (d) Notwithstanding what is stated in sub- regulation (b), a reporting corporation may defer the date of filing opening data forms to the ISA until seven days after the date for beginning obligatory electronic reporting of a reporting corporation, provided that if during the deferral period the reporting corporation is required to file with the ISA a document in accordance with the provisions of any law, the opening data forms will be filed with the ISA no later than the date of filing the document by electronic reporting to the ISA as stated. During the period beginning on the date that the reporting corporation filed opening data forms as stated in (b) and (c), a reporting corporation shall report sub-regulations to the ISA, by electronic reporting under these regulations, simultaneously with hard copy reporting to the offices of the

16 ISA in Jerusalem; if the securities of the corporation were listed for trade on the Stock Exchange and there is a duty under statute to file the document with the Stock Exchange the reporting corporation shall file a hard copy reporting also with the Stock Exchange on which its securities are listed for trade; during this period the binding reporting will be the hard copy reporting only, but if a report was liable to be filed during the said period under chapter 3 of the Securities (Periodic and Immediate Reports) Regulations, , the report shall be deemed to have been filed on time if the following two conditions are fulfilled: (1) It reached the ISA and the Stock Exchange on which securities of the corporation are listed for trading within the period prescribed for this by law, by facsimile; (2) It reached the ISA and the Stock Exchange on which securities of the corporation are listed for trading, with an original handwritten signature of the corporation, within fourteen days of the date prescribed for this by law, and it stated the day and the time on which it was sent to the ISA and the Stock Exchange by facsimile. (e) Starting on the day stipulated in the notice under regulation 25( 1)( d) as the date on which electronic reporting acquires binding status, the distribution site will be opened for the inspection of the public, and the reporting corporation shall report to the ISA by electronic reporting only in accordance with these regulations; notwithstanding what is stated in sub- regulation (d), from the date on which electronic reporting acquires binding status and thereafter, opening data forms filed with the ISA by electronic reporting under sub- regulation (b) or (c) and any electronic reporting filed with the ISA under sub- regulation (d) shall be binding in every respect. Initial registration of authorized electronic signatories for underwriter and trustee for certificates of indebtedness 22. (a) During the period of fourteen days beginning on the date specified in the the date for beginning the assimilation period of a reporting corporation, a reporting corporation shall be liable to report electronically to the ISA under these regulations, simultaneously with, and in addition to, the hard copy reporting; in addition to this, the reporting corporation will be entitled to report electronically practice reporting if it so chooses; during this period the binding reporting will be only the hard copy reporting filed with the ISA.

17 (b) and of the general manager, or of a director whom the board of directors authorized instead of one of these for the purpose of signing the application, stating the names of the signatories and their positions, and it shall be filed with the ISA at its offices in Jerusalem by personal delivery or by mail. If the ISA approved the application for registration as stated in subregulation (a), the person designated to act as authorized electronic signatory shall go to the offices of a signature approver when he has a valid approval of the ISA, and he shall identify himself before the signature approver and shall purchase means of signature and an electronic certificate for the purpose of electronic reporting; the validity of the ISA s approval for the purpose of going to the signature approver as stated in this sub- regulation shall be for fourteen days from the date of giving the approval. Beginning of electronic reporting by underwriter or trustee for certificates of indebtedness 23. (a) Beginning on the date stated in the notice under regulation 25( 2)( b) as the date for beginning the assimilation period of an underwriter or a trustee for certificates of indebtedness, an underwriter or a trustee for certificates of indebtedness, as applicable, will be liable to report electronically to the ISA under these regulations, simultaneously with, and in addition to, the hard copy reporting; in addition to this, the underwriter or the trustee, accordingly, will be entitled to report electronically practice reporting if it so chooses; during this period the binding reporting will be hard copy reporting only. (b) On the date stated in the notice under regulation 25(2)(c) as the date for beginning the obligatory electronic reporting of an underwriter or a trustee for certificates of indebtedness, an underwriter or trustee for certificates of indebtedness, as applicable, shall report to the ISA by electronic reporting only. Initial registration of authorized electronic signatories for a fund manager, fund trustee or fund liquidator [amended: 5765(2)] 23A (a) During a period of fourteen days beginning on the date stated in the notice under regulation 25( 3)( a) as the date for beginning the registration of authorized electronic signatories for a fund manager, fund trustee or fund liquidator, the fund manager, fund trustee or fund liquidator, as applicable, shall file with the ISA a written application for initial registration of an

18 (b) (c) authorized electronic signatory on MAGNA; the application shall be signed on behalf of the fund manager, fund trustee or fund liquidator, as applicable, with a handwritten signature of the chairman of the board of directors and of the general manager or of a director whom the board of directors authorized instead of one of the aforesaid for the purpose of signing the application, stating the names of the signatories and their positions, and it shall be filed with the ISA at its offices in Jerusalem by personal delivery or by mail; a fund manager shall file an application as aforesaid for all of the funds managed by it, and a fund manager for all of the funds for which he acts as trustee. Notwithstanding what is stated in sub- regulation (a), if the fund liquidator is an individual, the fund liquidator shall sign by hand on the application for initial registration of an authorized electronic signatory on MAGNA, and he shall file it with the ISA at its offices in Jerusalem by personal delivery or by hand. If the ISA approved the application for registration as stated in subregulation (a), the person who is designated to act as an authorized electronic signatory shall go to the offices of a signature approver when he has in his possession a valid approval of the ISA, identify himself before the signature approver, and buy a means of signature and an electronic certificate for the purpose of electronic reporting; the approval of the ISA for the purpose of going to a signature approver as stated in this subregulation shall be valid for fourteen days from the date of the approval. Initial electronic reporting of a fund manager, fund trustee or fund liquidator [amended: 5765(2)] 23B. (a) Beginning on the date, stated in the notice under regulation 25(3)(b) as the starting date of the adaptation period of a fund manager, fund trustee or fund liquidator, the fund manager, fund trustee or fund liquidator, accordingly, shall be obligated to report electronically to the ISA under these regulations, concurrently with and in addition to, the hard copy reporting; in addition to this, the fund manager, fund trustee or fund liquidator, accordingly, shall be entitled to report electronically and practice if it so chooses; during this period the binding reporting will be hard copy reporting only. (b) Beginning on the date stated in the notice under regulation 25(3)( c) as the date for beginning the obligatory electronic reporting of a fund manager, fund trustee or fund liquidator, the fund manager, fund trustee or fund liquidator, as applicable, shall report to the ISA by electronic reporting only.

19 Initial registration of a licensed corporation [amended: 5765(2)] 23C (a) During a period of fourteen days beginning on the date stated in the notice under regulation 25( 3)( a) as the date for commencing the registration of authorized electronic signatories for a licensed corporation, the licensed corporation shall file with the ISA a written application for initial registration of an authorized electronic signatory on MAGNA; the application shall be signed on behalf of the corporation with a handwritten signature of the chairman of the board of directors and of the general manager or of a director whom the board of directors authorized instead of one of the aforesaid for the purpose of signing the application, stating the names of the signatories and their positions, and it shall be filed with the ISA at its offices in Jerusalem by personal delivery or by mail. (b) If the ISA approved the application for registration as stated in subregulation (a), the person who is designated to act as an authorized electronic signatory shall go to the offices of a signature approver when he has in his possession a valid approval of the ISA, identify himself before the signature approver, and buy a means of signature and an electronic certificate for the purpose of electronic reporting; the approval of the ISA for the purpose of going to a signature approver as stated in this subregulation shall be valid for fourteen days from the date of the approval. Initial electronic reporting of a licensed corporation [amended: 5765(2)] 23D. (a) Beginning on the date stated in the notice under regulation 25(3)( b) as the starting date of the adaptation period for a licensed corporation, the licensed corporation shall be obligated to report electronically to the ISA under these regulations, concurrently and in addition to, the hard copy reporting; in addition to this, the licensed corporation shall be entitled to report electronically and practice reporting if it so chooses; during this period the binding reporting will be the hard copy reporting only. (b) Beginning on the date stated in the notice under regulation 25(3)( c) as the date for beginning the obligatory electronic reporting of a licensed corporation, the licensed corporation shall report to the ISA by electronic reporting only.

20 Chapter 8: Miscellaneous Penalties 24. Someone who breaches one of the provisions of these regulations shall be liable to six months imprisonment or a fine as stated in section 61( a)( 1) of the Penal Code, Commencement 25. The commencement of these regulations is (1) With regard to reporting corporations, on the date that will be published by the chairman of the ISA in a notice in Reshumot, and in accordance with notices that the chairman of the ISA will publish in Reshumot, in which the following dates will be stipulated: (a) The date for beginning registration of authorized electronic signatories; (b) The date for beginning the adaptation period; (c) (d) The date for beginning obligatory electronic reporting; The date on which the electronic reporting will acquire a binding status; (2) With regard to underwriters, trustees for certificates of indebtedness and reporters that are not reporting entities, jointly or separately, on the date that will be published by the chairman of the ISA in a notice in Reshumot, and in accordance with notices that the chairman of the ISA will publish in Reshumot, in which the following dates will be stipulated: (a) The date for beginning registration of authorized electronic signatories; 3 (b) The date for beginning the adaptation period; (c) The date for beginning obligatory electronic reporting. 4 (3) With regard to fund managers, fund trustees, fund liquidators and licensed corporations, jointly or separately, on the date that will be published by the chairman of the ISA in a notice in Reshumot, and in accordance with notices that the chairman of the ISA will publish in Reshumot, in which the following dates will be stipulated: (a) (b) (c) The date for beginning registration of authorized electronic signatories; The date for beginning the adaptation period; The date for beginning obligatory electronic reporting. 3 registration of authorized electronic signatories is stipulated to commence on (Official notes 5367, 15/01/2005. p. 1579) 4 obligatory electronic reporting is stipulated to commence on (Official notes 5409, p. 3097)

21 Non- electronic reporting 26. (a) If the chairman of the ISA, and in his absence an employee of the ISA whom he authorized for this purpose, decides that exceptional conditions concerning the activity of MAGNA exist, he may direct - if he is of the opinion that this is required in order to protect the interests of the investing public, without detracting from the stated in these regulations and for a period that he shall prescribe, which shall not exceed the minimum period required by the circumstances of the case - that the reporting to the ISA and the Stock Exchange shall not be made by means of electronic reporting, but in a manner that he shall prescribe; such a directive shall be published on the internet site of the ISA, in two daily newspapers and in other media as he shall see fit. (b) Notwithstanding the stated under these regulations, the documents set out below shall be filed with the ISA at its offices in Jerusalem by means of a hard copy only: (1) An application for exemption from disclosure of an item in a prospectus under section 19(a) of the Law and any documents relating thereto; (2) An application for exemption from disclosure of an item in a report under section 36C (a) of the Law and any documents relating thereto. Amounts of fees in new shekels For First Schedule (Regulations 16( b) and 18( c)) (amended: ) (amended: ) a. An annual fee for downloading data from the distribution site under regulation 16( b) 62,044 NIS b. A certified copy under regulation 18( c), up to five pages.38 NIS c. A certified copy under regulation 18( c), for each additional page.. 3 NIS 18 March 2003 Benjamin Netanyahu Minister of Finance