The Tel Aviv Stock Exchange (TASE) announces Resolutions of the Israel Securities Authority Regarding the Indices Activity on TASE

TEL AVIV, Israel, Sept. 21, 2022 /PRNewswire/ -- The Tel Aviv Stock Exchange Ltd (TASE: TASE) announces that, on September 20, 2022, it has received the resolution of the Israel Securities Authority's Secondary Market Committee concerning amendments to the TASE Rules and the regulations by virtue thereof in connection with indices activities on TASE (hereafter: "the Authority's Resolution", "the Authority" and "the Committee", respectively). The Resolution was received in response to TASE's application for approval of the amendment to the pricelist concerning the TASE indices (hereafter: "the Indices Pricelist").

According to the Authority's Resolution, as a prerequisite for the Committee's approval of the amendment to the Indices Pricelist, TASE is required to make certain adjustments and amendments to the Indices Pricelist, as specified in the Authority's Resolution, the principal of which are:

1. Determining that for the use of the T-bill indices no commission will be charged; for the use of government bond indices a commission of 0.01% will be charged; for the use of bond indices a commission of 0.02% will be charged; and for the use of equity indices a commission of 0.03% will be charged;
2. Determining that the tariff for leveraged financial instruments will be equal to the regular tariff;
3. Setting of a minimum tariff in tailor-made indices, at a rate that is identical to the tariff charged for TASE indices that are not tailor-made;
4. Determining that the implementation of the new tariffs will be carried out in two steps, the first at the beginning of 2023 and the second at the beginning of 2024.

Accordingly, TASE has been requested to submit to the approval of the Authority an amended version of the Indices Pricelist that reflects its comments. TASE intends to comply promptly.

At the same time, TASE has received a notice (hereafter: "the Authority's Notice"), pursuant to which the Authority is considering a determination that TASE's engagement in the editing and calculation of the indices would be deemed as an auxiliary service that raises a real concern for a conflict of interest with its engagement in the management of a platform for the trading in securities (hereafter: "the Management of Trade"), such that TASE would be permitted to continue its engagement in the editing and calculation of the indices subject to compliance with terms prescribed by the Authority to mitigate the potential conflict of interest with the Management of Trade.

These terms relate primarily to the improvement of the corporate governance in the activity of TASE as an editor of indices; organizational segregation of the indices' editing activity from the Management of Trade; professional segregation of those activities; ensuring the existence of fair competition in the indices' editing sector; existence of independent oversight over the implementation of the arrangements for the mitigation of the conflict of interest; and the existence of a pricing arrangement that complies with the Authority's Resolution regarding the pricelist.

TASE has been requested to deliver to the Authority its response to the Authority's Notice within 45 days. TASE is studying the Authority's Notice and will deliver its response accordingly.

TASE believes that, based on the current use of the TASE indices and the volume of assets managed within this framework, the full implementation of the new tariffs is expected to increase the revenue of TASE from the indices activity by an estimated annual amount of approximately NIS 8 million in 2023 and by an estimated annual amount of approximately NIS 16 million in 2024 and thereafter, compared to revenue of approximately NIS 3 million in 2021. It should be noted that, to the date of the report, the volume of costs that would be required to implement the requisite adjustments cannot be estimated. Nevertheless, the company believes that the volume of costs is not expected to be material.

TASE's assessments concerning the anticipated increase in revenue from the indices activity is forward-looking information, which is based on the activity and market data that are known shortly before the date of this immediate report. This

information may not be realized or may be realized in a materially different manner, as a result of a failure to reach understandings with the Authority in connection with the implementation of the Authority's Resolution and the Authority's Notice, as well as due to changes in the volume of indices activities and in the market conditions in this sector, compared to the current conditions.

Contact:
Orna Goren
Head of Communication and Public Relations Unit
Tel: +972 76 8160405
[email protected]

SOURCE Tel Aviv Stock Exchange Ltd

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