Financial Services Supervision Law (Provident Funds), 5765-2005

In this Law –

"Arad-type bond" means a non-negotiable bond issued by the State of Israel to provident funds for pension only, pursuant to the State Loan Regulations ("Arad" Series), 5755-1995;

"provident fund approval" means an approval granted pursuant to the provisions of section 13;

"means of control", "equity capital", "holding" and "control" – as defined in the Financial Services Supervision Law (Insurance);

"external director" means an external director as defined in the Companies Law, 5759-1999, who possesses professional qualifications as referred to in section 219(c) of that Law;

"the Committee" – as defined in the Financial Services Supervision Law (Insurance);

"the Commissioner" means the Commissioner of Capital Markets, Insurance and Savings as defined in the Financial Services Supervision Law (Insurance);

"investment committee" means the committee appointed pursuant to the provisions of section 11;

"Finance Committee" means the Finance Committee of the Knesset;

"managing company" means a company that has been granted a managing company licence;

"Economic Efficiency Law 2017 and 2018" means the Economic Efficiency Law (Legislative Amendments for Achieving Budget Targets for the Budget Years 2017 and 2018), 5777-2016;

"Companies Law" means the Companies Law, 5759-1999;

"Pension Advisory and Marketing Law" means the Financial Services Supervision Law (Pension Advisory, Marketing and Clearing System), 5765-2005;

"Penal Law" means the Penal Law, 5737-1977;

"Financial Services Supervision Law (Insurance)" means the Financial Services Supervision Law (Insurance), 5741-1981;

"Joint Investment in Trust Law" means the Joint Investment in Trust Law, 5754-1994;

"Severance Pay Law" means the Severance Pay Law, 5723-1963;

"provident fund monies" means the total of all monies and income received by a managing company for a provident fund under its management, after deducting all of the following:

"insurer" – as defined in the Financial Services Supervision Law (Insurance);

"index" means the consumer price index (including fruit and vegetables) published by the Central Bureau of Statistics;

"beneficiary" means a person entitled to receive monies from a provident fund by reason of the death of a member of the provident fund or by reason of the death of an employee of an employer-member, in accordance with the records of the provident fund; and if the managing company has become aware that another person is entitled to receive such monies under any law, that other person shall be the beneficiary in respect of monies not yet withdrawn from the fund;

"cooperative moshav" means a cooperative moshav in respect of which a direction has been given pursuant to section 61 of the Income Tax Ordinance [New Version];

"employer" means a person who pays wages or a salary;

"severance pay component" means the component in a provident fund account of payments in respect of severance pay, as defined pursuant to section 21;

"office holder" – as defined in the Companies Law, 5759-1999, and any employee directly subordinate thereto, as well as a member of an investment committee;

"provident fund assets" means the total of all assets managed by a managing company on behalf of the members of a provident fund under its management;

"employee of an employer-member" means an employee of an employer-member or a member of an employer-member on whose behalf the member paid monies to a central provident fund;

"member" means a person in whose name monies are registered in the records of a provident fund, or a person entitled to receive monies from a provident fund, excluding a beneficiary and excluding an employee of an employer-member;

"employer-member" means a member who is an employer paying monies to a central provident fund on behalf of its employees, or a member who is a kibbutz or cooperative moshav paying monies to a central provident fund on behalf of its members;

"independent member" means an individual member paying monies to a provident fund on his own behalf, including an employee paying such monies without a parallel payment by his employer;

"cooperative member" means a member of a provident fund for gratuities who is a kibbutz or cooperative moshav paying monies to the provident fund on behalf of its members;

"employed member" means a member who is an employee whose employer pays monies to a provident fund on his behalf;

"severance pay" means a capital sum paid by an employer to an employee or to his survivors as a grant upon retirement or death;

"insurance policy fund" means an insurance plan approved pursuant to the provisions of section 13(b) as a provident fund for gratuities, for severance pay or for pension;

"provident fund" or "fund" means a fund or an insurance plan in respect of which a provident fund approval has been granted pursuant to the provisions of section 13;

"personal provident fund for sick pay" means a provident fund for sick pay administered in personal accounts in the names of the employees;

"personal provident fund for severance pay" means a provident fund for severance pay administered in personal accounts in the names of the employees;

"individually managed provident fund" means a fund approved pursuant to the provisions of section 13(a) as a provident fund for gratuities, as a provident fund for pension or as a training fund, or an insurance plan approved pursuant to the provisions of section 13(b) as a provident fund for gratuities or as a provident fund for pension, intended for a single member only who is entitled to give instructions with respect to the investment of the monies in the fund;

"provident fund for sick pay" means a provident fund intended for the payment of sick pay in accordance with provisions relating to entitlement to sick pay in a collective agreement applicable to the members or to employees of an employer-member, as the case may be, or in accordance with any of the provisions of the following laws:

"provident fund for investment" means a provident fund intended for the payment of a capital sum to an independent member or to his beneficiaries;

"provident fund for vacation" means a provident fund intended for the payment of vacation pay, whose members are daily workers as defined in the Income Tax and Employers Tax Regulations (Deduction from Wages and Payment of Employers Tax), 5753-1993; for this purpose, "vacation pay" means amounts paid to an employee under any law or agreement in respect of vacation days;

"provident fund for savings" means a provident fund for pension that is not an insurance policy fund, a pension fund or a central provident fund for pension;

"provident fund for another purpose" means a provident fund intended for the payment of recuperation pay, as well as a provident fund intended for the payment of holiday pay, accident pay and similar other payments;

"multi-track provident fund" means a provident fund in which several investment tracks are managed and whose regulations entitle the member to choose from among them the investment tracks in which his monies will be invested; for this purpose, "investment track" means an investment channel for members' monies characterised by investment restrictions set out in the provident fund's regulations;

"central provident fund" means a provident fund whose members are employers or kibbutzim or cooperative moshavim only;

"central provident fund for sick pay" means a provident fund for sick pay that is a central provident fund;

"central provident fund for participation in a budgetary pension" means a central provident fund intended for participation in the financing of pension payments to employees of an employer-member;

"central provident fund for severance pay" means a provident fund for severance pay that is a central provident fund;

"central provident fund for pension" means a provident fund for pension that is a central provident fund which is not an insurance policy fund, intended for a single employer-member only for the purpose of paying pension to employees of the employer-member;

"sectoral provident fund" means a provident fund in which all of the following conditions are met:

"provident fund for severance pay" means a provident fund intended for the payment of severance pay;

"provident fund for pension" means a provident fund intended for the payment of pension;

"provident fund paying pension" – (Repealed)

"provident fund not paying pension" – (Repealed)

"provident fund for gratuities" means a provident fund intended for the payment of gratuities;

"kibbutz" – as defined in section 54(a) of the Income Tax Ordinance [New Version];

"pension" means any one of the following:

for the purpose of this paragraph, "equal updated amounts" means equal amounts updated in accordance with provisions in the fund's regulations or in the insurance policy relating to linkage or interest, including linkage to the index, to the average wage in the economy or to the fund's yield, or which prescribe another updating mechanism approved by the Commissioner;

"training fund" means a provident fund intended for the payment of training grants to employees, to self-employed persons, to kibbutz members, to cooperative moshav members or to their beneficiaries;

"veteran fund" means a provident fund for pension that is not an insurance policy fund, first approved pursuant to provident fund regulations before the 29th day of Tevet 5755 (1 January 1995);

"general new fund" means a provident fund for pension that is not an insurance policy fund, that is not a comprehensive new fund and that is not a central provident fund for pension, first approved after the 29th day of Tevet 5755 (1 January 1995);

"comprehensive new fund" means a provident fund for pension that is not an insurance policy fund or a central provident fund for pension, in which all of the following conditions are met:

"pension fund" means a veteran fund, a general new fund and a comprehensive new fund;

"provident fund records" means records maintained by a managing company in respect of a provident fund under its management, in accordance with the regulations of that fund and the provisions of any law;

"managing company licence" means a licence to engage in the management of provident funds, granted pursuant to the provisions of section 4(a);

"gratuities" means a capital sum paid from a provident fund, in accordance with its regulations, to an employed member, an independent member, a cooperative member or their beneficiaries, from monies accumulated in the provident fund to the credit of those members;

"insurance plan" – as defined in the Financial Services Supervision Law (Insurance);

"the Minister" means the Minister of Finance.