The Department for Supervision of the Stock Exchange and Trading Platforms coordinates the supervision and control of the sound and proper management of a Stock Exchange as defined. The supervisory powers are derived from the provisions of the Securities Law, specifically Chapter H of the Law which determines the Authority's duties and its powers in the supervision of the sound and proper management of the Stock Exchange. As part of its powers concerning the determination of the provisions in the Stock Exchange's bylaws and its directives, the department examines the Stock Exchange's requests for changes in the bylaws and directives it determined, and presents its recommendations to the Authority plenum. The department's representatives also act as observers for the Authority on the Stock Exchange board of directors and its committees.
The Department for Supervision of the Stock Exchange and Trading Platforms coordinates the supervision and control of clearing houses as defined in the Securities Law to ascertain their stability and efficiency. The supervisory powers are derived from the provisions of the Securities Law, specifically Chapter H of the Law which determines the Authority's duties and powers in the supervision and control of clearing houses. As part of the Authority's supervision of clearing house activities, section 50C of the Law states that the Authority will exercise control over a clearing house to ascertain its stability and efficiency. For this purpose, it was determined that the Authority would examine, among other things, the system's credibility, its accessibility, the completeness, reliability and security of the information in it, and the existence and content of rules regulating the finality of the instructions and operations received and conducted by it. It also states that the Authority will examine the propriety of the rules of the clearing house and the fulfilment of its responsibility to meet the conditions and requirements applying to it under the provisions of the Law.
The Authority supervises the Tel Aviv Stock Exchange Clearing House Ltd. and the Maof Clearing House Ltd. In its role as supervisor of clearing houses, the Authority decided to adopt and implement consistently the Principles for Financial Market Infrastructures (PFMI) and to apply them to the Stock Exchange Clearing Houses with the aim of ascertaining their stability and efficiency. In December 2015, the Authority plenum approved an order to ascertain the proper functioning of the Stock Exchange Clearing Houses under section 50C(b) of the Securities Law. The order regulates the activities of the Stock Exchange Clearing House and the Maof Clearing House according to the standards determined in those principles. The order includes, among other things, rules on corporate governance, settlement arrangements, risk management, collateral, management of a clearing house member's failure, clearing house membership requirements, information and disclosure, equity, liquidity and insurance requirements.