On July 6, 2017, Amendment 63 to the Securities Law, 5728-1968 (the “Amendment” and the “Law”, respectively), was enacted. This Amendment includes a prohibition on offering securities trading services with respect to a trading system that is not licensed in Israel.Under the new Section 49A to the Law, there is a prohibition on offering securities-tradingservices through a securities trading system which is not managed by a licensed exchange in Israel. The Amendment does not specify any exceptions to the application of Section 49A, including with respect to offering securities trading services to Sophisticated Clients.  

As of the date of this client update, and as long as no further clarification has been issued by the ISA, there is considerable concern regarding the application of Section 49A of the Law to many financial institutions (both domestic and international), whose activities involve an offer of securities trading services other than through the Tel Aviv Stock Exchange.  

Accordingly, entities or individuals wishing to offer securities trading services with respect to a securities trading system managed by a foreign exchange, must immediately obtain legal advice as to the application of the Amendment to their activities, including considering whether a request for a permit from the Chairman of the ISA is required.   Our firm is in continuous contact with the ISA in this regard and is advising entities and individuals regarding the application of the Amendment to their business.   We are at your service in order to examine whether your activity could be regarded as an offering of such services and the need to approach the ISA in this matter.  

To view the full wording of the Amendment - click here.