The Israeli government today published a draft of a law to be known as the Provision of Financial Information Services Law, 2020.
The law seeks to introduce a system for the regulation of the provision of financial information. “Financial information” is defined as information as to the financial conduct of a client, held by an “information source”, which includes an Israeli bank. It would introduce a licensing requirement for the provider of a financial information service, though certain types of entities, such as a bank, would be exempt from the licensing requirement.
The draft law sets out a series of duties which would be imposed on a financial information services provider (whether a licensee or an entity exempt therefrom); these would include obligations of trust, care, confidentiality, as to how the information is to be held, used and transferred, and how it is to be made available to clients. Additional obligations would be imposed on information sources.
A foreign entity holding a non-Israeli licence for the provision of financial information services would be able to apply for an Israeli licence, and could be exempted from certain of the application requirements and the obligations thereof were the supervising authority (the Israel Securities Authority) to be satisfied that the relevant foreign regulations to which the entity was subject were sufficient in this regard.
The purpose of the draft law would be to create a standard for the provision of financial information and to afford clients greater ease of access thereto, thereby enabling them, for example, more easily to compare financial products and services by looking at costs, yields etc., with a view to removing barriers to competition and creating greater efficiency in the provision of financial services in Israel.
The draft is open for comments from the public until 15 July 2020. The full text (in Hebrew) can be found here.