Joint Investments in Trust Law, 5754-1994
חוק השקעות משותפות בנאמנות, תשנ"ד-1994
Published: 1994-08-23Consolidated Hebrew text as of 2026-01-01 · Last amended 2026-08-02✓ Amendment status checked against the Knesset legislation record on 2026-09-28
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Unofficial English translation — for reference only. It may contain errors or omissions and cannot be relied on as a legal text. Only the Hebrew text published in Reshumot is legally binding.More
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Despite these checks, it may contain errors, omissions, or imprecise renderings of legal terminology and cross-references, and it may not yet reflect the latest amendments. It cannot be relied upon as a legal text.
The Hebrew text as published in Reshumot (ספר החוקים) and on the Knesset website is the sole authoritative and legally binding version. In any discrepancy, the Hebrew text prevails.
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Section B: Closed-ended Fund
Unit Price§
50.
(a)The price of a unit in a closed-ended fund shall be:
(1)in the first offering – a price determined in the prospectus;
(2)in any other offering – a price to be determined in a tender held by the fund manager in the manner and on the conditions set out in the prospectus; if the price determined in the tender is lower than the unit price on the day on which the results of the tender were determined – the offering shall be cancelled; for this purpose, "unit price" – the purchase price of the fund's assets divided by the number of its units.
(b)A manager of a closed-ended fund shall calculate the unit price of the fund and the unit value; the Minister of Finance may prescribe by Regulations provisions regarding the determination of the value of the assets of a closed-ended fund and the manner of calculating the purchase price, as well as provisions regarding the manner and times at which the fund manager shall publish the unit price of the fund and the unit value; for this purpose, "unit value", of a fund – the net asset value of the fund divided by the number of its units.
(c)The Minister of Finance may prescribe conditions under which a manager of a closed-ended fund may add to the unit price or deduct from the redemption price a commission to be paid to the fund, as well as conditions under which a manager of a closed-ended fund is required to add to the unit price or to deduct from the redemption price such a commission, all at rates to be prescribed by the Minister, for types of funds to be prescribed by the Minister; the Authority may direct the classification of a fund into a type so prescribed.
Exchange Approval for Listing of Units§
51.
A fund manager shall not offer units of a closed-ended fund except after receiving the approval of the exchange for their listing for trading.
Report on the Results of the Offering§
52.
A manager of a closed-ended fund shall submit to the Authority and to the exchange a report on the results of the offering set out in the prospectus, in accordance with the particulars and at the time prescribed by the Minister of Finance by Regulations, and shall publish the report in a newspaper.
Allocation of Units and Transfer of Funds§
53.
(a)On the allotment day of units of a closed-ended fund, the fund manager shall do all of the following:
(1)register the fund's units for trading on the exchange;
(2)allot the offered units to the persons who placed orders;
(3)transfer to the fund's account a sum in cash equal to the price of the units allotted to the persons who placed orders.
(b)Where the number of units ordered exceeds the number of units offered, the fund manager shall allot the offered units in the manner and way specified in the prospectus.
(c)On the allotment day of the units, a distributor shall debit the account of a person who placed an order for units through the distributor by a sum equal to the price of the units allotted to that person, and shall transfer to the fund manager's account a sum in cash equal to the price of the units allotted to the person who placed the order.
(d)For the purposes of this section, "allotment day" – no later than two days after the end of the period for submitting orders for units in a first offering, or after the day on which a tender as referred to in section 50 was held.
Cancellation of Offering§
54.
(a)If the units of a closed-ended fund have not been listed for trading on the exchange, or if orders for units have not been submitted within the period prescribed for their submission in an amount equal to the minimum amount prescribed in the prospectus for the offering, the offering shall be cancelled.
(b)The fund manager shall submit to the Authority and to the exchange a report on the cancellation of the offering and the reason for its cancellation, at the time prescribed by the Minister of Finance by Regulations, and shall publish the report in a newspaper.
Regulations Regarding the Offering of Units of a Closed-ended Fund§
54a.
The Minister of Finance may prescribe additional provisions regarding the offering of units of a closed-ended fund, the particulars to be included in the prospectus and particulars that may be completed at a later date, as well as provisions regarding the timing of the offering, the number of units offered and the manner of allotting the units offered to persons who placed orders; provisions as aforesaid may be prescribed generally, in respect of a high-technology fund or in respect of other types of closed-ended funds.
Suspension of Offering of Units and their Redemption§
54b.
The power vested in the Chairperson of the Authority under section 48 in respect of the suspension of the offering of units of an open-ended fund or the suspension of their redemption, shall also be vested in the Chairperson in respect of the suspension of the offering of units of an exchange-traded fund or the suspension of their redemption.
Price of Traded Units§
55.
The prices of units of a closed-ended fund shall be determined, after they have begun trading on the exchange, in accordance with the results of trading.
Redemption of Units§
56.
(a)Where a closed-ended fund agreement provides that the units are redeemable, the fund manager shall redeem a unit upon the demand of a unit holder at a redemption date as specified in the fund agreement, being the date closest to the day on which the fund manager received the redemption demand (in this section – the redemption date), provided that the period between consecutive fixed dates shall not be less than three months.
(a1)Where a manager of a closed-ended fund has received a demand from a unit holder to redeem a unit, the fund manager shall cancel the unit on the redemption date and shall transfer from the fund's account to the distributor, through the clearing house, in the manner determined in accordance with rules set by the clearing house after consultation with the Authority, a sum in cash equal to the redemption price of the unit that was redeemed; the distributor shall transfer the sum so transferred to it as aforesaid to the unit holder who requested the redemption, on the same day; the Minister of Finance may prescribe conditions under which a manager of a closed-ended fund may redeem a unit in consideration that is not in cash, or cases in which a manager of a closed-ended fund is required to do so.
(b)The redemption price of a unit in a closed-ended fund shall be equal to the sale price of the fund's assets divided by the number of its units; the Minister of Finance may prescribe by Regulations provisions regarding the manner of calculating the sale price of a closed-ended fund's assets as well as provisions regarding the manner and times at which the fund manager shall publish the redemption price of the unit.
(c)The redemption of units of a closed-ended fund may be limited to a maximum number of units per unit holder, if so provided in the fund agreement.
(d)The redemption of units in a closed-ended fund may be made conditional upon advance notice being given by a unit holder to the fund manager; such a condition shall be included in the fund agreement.
(e)(Repealed).
(f)(Repealed).
(g)The Minister of Finance may prescribe by Regulations additional cases and conditions under which a fund manager may redeem units in a closed-ended fund on the fund manager's own initiative or upon the demand of a unit holder, as well as cases and conditions under which a fund manager is required to redeem units of a closed-ended fund as aforesaid or is not permitted to redeem them, and additional provisions regarding the redemption of units as aforesaid, all generally, in respect of a high-technology fund, in respect of an exchange-traded fund or in respect of other types of closed-ended funds.
Return of Units or their Allotment without Consideration§
57.
(a)The Minister of Finance may prescribe by Regulations conditions under which a manager of a closed-ended fund may, in the course of trading on the exchange, purchase units of the fund for the fund's account (in this Law – return of units) or sell units that were so returned.
(b)
(1)Notwithstanding the provisions of sections 53(a)(2) and (3), 56(a1) and 58, the Minister of Finance may prescribe by Regulations cases and conditions under which a manager of a closed-ended fund may allot to the fund, without consideration, units of the fund for which the exchange's approval for listing for trading has been received; where the Minister has so prescribed, the Minister may provide that a unit that is redeemed shall not be cancelled by the fund manager;
(2)a unit allotted to the fund pursuant to the provisions of paragraph (1) and a unit that was redeemed and not cancelled pursuant to the provisions of that paragraph shall not confer any rights and shall not be counted among the fund's units for as long as they are held by the fund (in this subsection – dormant units);
(3)the Minister of Finance may prescribe provisions regarding the calculation of the price of dormant units at the time of their offering to the public by the fund manager.
(c)The Minister of Finance may prescribe by Regulations additional provisions to ensure the tradability of units of a closed-ended fund, including provisions regarding the obligation of a manager of a closed-ended fund to enter into an agreement with a market maker, as defined in section 82(a)(6), in respect of the units of the fund, and provisions regarding the activity of such a market maker.
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Contact Us →Section C: Common Provisions
Issuance of Units for Consideration and Bonus Units§
58.
(a)A unit shall not be issued without consideration.
(b)Notwithstanding the provisions of subsection (a), a fund manager may allot to unit holders only, units without consideration, proportionate to the number of units held by each unit holder on the day designated by the fund manager for that purpose (hereinafter – bonus units).
Transfer of Units§
58a.
(a)A distributor shall transfer units pursuant to a written demand of a unit holder who holds units through the distributor, and a fund manager shall transfer units pursuant to a written demand of a unit holder whose units are registered in the unit holder's name with the fund manager; the transfer of units as aforesaid shall be effected in the manner detailed in the prospectus.
(b)Notwithstanding the provisions of subsection (a), a distributor or a fund manager shall not transfer units if so provided in the prospectus, unless the transfer is by operation of law.
Restriction on Ordering of Units§
58b.
A fund manager may provide that an order for fund units exceeding an amount or rate to be determined by the fund manager shall not be acted upon, provided that the said amount or rate shall not be less than an amount or rate to be prescribed by the Authority.
Assets that May be Purchased and Held in a Fund§
59.
A fund manager shall not purchase for a fund under the fund manager's management, nor hold in it, anything other than securities, foreign securities, options, futures contracts, a money market fund, foreign currency, cash and any other asset prescribed by the Minister of Finance by Regulations, all of the types and on the conditions prescribed by the Minister, generally or for types of funds.
Prior Approval for Execution of a Transaction§
60.
A fund manager shall not be permitted to execute a transaction as referred to in section 18(6), (7) or (7a) unless it has been approved in advance by the board of directors or by a committee of its committees.
Investment of Fund Assets§
61.
(a)A fund manager shall invest the assets of the fund in accordance with the investment policy of the fund as determined in the fund agreement and in the prospectus or in a report submitted pursuant to this Law. Where the fund's investments have deviated from the investment policy as aforesaid, such deviation shall not be regarded as a breach of the provisions of this section if both of the following conditions are met:
(1)the fund manager corrected the deviation by the end of the second price calculation day following the day on which it commenced;
(2)the fund's investments deviated from the investment policy as aforesaid no more than five times in a period of twelve months.
(a1)Notwithstanding the provisions of subsection (a), additional deviations shall not be regarded as a breach of the provisions of this subsection if the Chairperson of the Authority is satisfied that the fund manager took appropriate measures to prevent the breach and corrected the deviation as referred to in subsection (a)(1).
(b)The Minister of Finance may prescribe in Regulations, generally or for types of funds, a period during which a fund manager who is offering the fund's units to the public for the first time, or who is offering units of a fund whose investment policy has been changed in a manner that requires the replacement of at least thirty percent of its assets, shall be permitted to invest the assets of the fund otherwise than as set out in subsection (a).
(b1)
(1)A fund manager shall not make a material change to the investment policy of a fund under its management, as determined in the fund agreement, in the prospectus or in a report submitted pursuant to this Law, more than once in a period of twelve months; in this section, "material change to the investment policy of a fund" – a change to the investment policy of a fund that requires a change in the classification of the fund in a publication made in accordance with the provisions of section 73(a), or that is capable of materially affecting the volatility of the unit prices and redemption prices of the fund's units;
(2)the Minister of Finance may prescribe in Regulations conditions under which, notwithstanding paragraph (1), a fund manager may make a material change to the investment policy of a fund under its management more than once in a period of twelve months.
(c)
(1)A fund manager shall submit to the Authority and to the exchange a report on a change in the investment policy of a fund under its management, and shall publish it in a newspaper;
(2)where a material change has been made to the investment policy of a fund, the fund manager shall send the report to the unit holders who hold units through it, at their addresses known at that time, and shall notify the distributor through whom units are held that it is required to send the report to the unit holders; a distributor shall send the report to the unit holders who hold units through it, at their addresses known at that time, immediately after receiving the notification;
(3)(deleted);
(4)the Minister of Finance shall prescribe the particulars to be included in the report pursuant to this section, and the time for its submission and publication.
Diversification of Investments§
62.
(a)In this section –
"rate of securities of a corporation" – the value of securities or foreign securities issued by an issuer that is not the State of Israel, held in the fund, out of the total net asset value of the fund;
"rate of a security of the registered trading value" – the value of a security or a foreign security held in the fund or in funds under the management of a fund manager, out of the total quantity of the security or the foreign security registered for trading, multiplied by its value at the close of the trading day;
"rate of another asset" – the value of an asset held in the fund that is not a security or a foreign security, out of the total net asset value of the fund.
(b)The Minister of Finance may prescribe, generally or for types of funds, conditions for the purchase or holding of assets as referred to in section 59, and may also prescribe a maximum rate –
(1)for the rate of securities of a corporation;
(2)for the rate of a security of the registered trading value;
(3)for the rate of another asset.
(b1)The value of a security issued by a significant real corporation, other than a bond, that a fund manager shall hold, including in funds under its management, shall not exceed ten percent of the registered trading value of the security issued by the corporation; for the purpose of calculating the holding rate as aforesaid, holdings of a financial body controlled by the fund manager shall not be counted; in this subsection –
"registered trading value of a security" – the value of the security at the close of the trading day multiplied by the quantity of the security registered for trading;
"financial body" and "significant real corporation" – as defined in section 23b2.
(c)Where the rate of securities of a corporation, or the rate of a security of the registered trading value, or the rate of another asset, has exceeded the maximum rate prescribed by the Minister of Finance, such excess shall not be regarded as a breach of the provisions of this section if both of the following conditions are met:
(1)the rate was reduced to the permitted rate by the end of the second price calculation day following the day on which it exceeded the maximum rate;
(2)the rate exceeded the maximum rate no more than five times in a period of twelve months.
(d)Notwithstanding the provisions of subsection (c), additional deviations shall not be regarded as a breach of the provisions of this section if the Chairperson of the Authority is satisfied that the fund manager took appropriate measures to prevent the breach, and the condition set out in subsection (c)(1) has been met.
Short Sale Transaction§
63.
The Minister of Finance may prescribe in Regulations, generally or for types of funds, the conditions under which a fund manager shall be permitted –
(1)to lend securities held in a fund under its management for the purpose of a short sale transaction, provided that the lending is not to the fund manager, to a person who controls it, to a company controlled by such a person, to a director, or to an employee of any of them for the purpose of a short sale transaction by them, or to another fund under the management of the fund manager for the purpose of a short sale transaction on its behalf;
(2)to carry out a short sale transaction on behalf of a fund under its management.
In this section, "short sale transaction" – a sale on an exchange or on a regulated market of securities that do not belong to the seller, in accordance with the rules applicable to such a sale on the exchange or regulated market on which the sale is carried out.
Futures Contract and Option§
64.
(a)The Minister of Finance may prescribe in Regulations, generally or for types of funds, the conditions under which a fund manager shall be permitted to purchase, sell, or create an option or futures contract on behalf of a fund under its management.
(b)For the purposes of this Law –
"option" – an undertaking that grants its purchaser the right to buy or sell the underlying asset at the exercise price, or to receive the difference between the exercise price and the value of the underlying asset, all at the times and subject to the conditions specified in the option;
"futures contract" – an undertaking to deliver or receive in the future differences in foreign currency exchange rates, index differences, interest differences, an asset or the price of an asset, in the quantity, at the time and subject to the conditions specified in the undertaking;
"exercise price" – the price at which the undertaking in an option shall be exercised;
"underlying asset" – the asset that is the subject of the undertaking in an option.
(c)The Minister of Finance may prescribe in Regulations the method of calculating the value of an underlying asset.
Cash or Credit Transactions and Liabilities§
65.
(a)A fund manager shall not take credit on behalf of a fund under its management; however, the Minister of Finance may prescribe in Regulations types of transactions that a fund manager is permitted to carry out on credit, subject to conditions prescribed by him, and may also prescribe conditions under which a fund manager is permitted to receive credit for the purpose of redeeming units and the rate of such credit.
(a1)Where a fund manager has carried out a credit transaction on behalf of a fund under its management or received credit for the purpose of redeeming units, in deviation from the provisions pursuant to subsection (a), such act shall not be regarded as a breach of the provisions pursuant to that subsection if both of the following conditions are met:
(1)the fund manager corrected the deviation by the end of the second price calculation day following the day on which it commenced;
(2)the number of deviations from the provisions pursuant to this section did not exceed five times in a period of twelve months.
(b)The Minister of Finance may prescribe in Regulations, generally or for types of funds, a maximum rate for the liabilities of a fund out of the net asset value of its assets, and may prescribe different rates for different types of liabilities; for the purposes of this section, "liabilities" – excluding liabilities in respect of the fees of the fund manager and the trustee, and tax liabilities.
(c)Where the liabilities of a fund have exceeded the rate prescribed by the Minister of Finance pursuant to subsection (b), the fund manager shall act to reduce them until they reach the permitted rate.
Temporary Provisions for Fund Managers§
65a.
(a)Notwithstanding the provisions of sections 59 and 63 to 65, the Authority may, if it finds that special circumstances exist that justify immediate regulation in order to ensure the proper conduct of fund managers or in order to ensure the protection of the interests of the investing public –
(1)prohibit fund managers from purchasing and holding, on behalf of the funds under their management, assets prescribed by the Minister of Finance in Regulations pursuant to section 59, or permit them to purchase and hold assets in addition to those prescribed as aforesaid;
(2)permit a fund manager to lend securities held in a fund under its management for the purpose of a short sale transaction as defined in section 63, or to carry out a short sale transaction as aforesaid on behalf of a fund under its management, on conditions different from those prescribed pursuant to that section;
(3)permit a fund manager to purchase, sell, or create an option or futures contract as defined in section 64 on behalf of a fund under its management, on conditions different from those prescribed pursuant to that section;
(4)permit a fund manager to carry out credit transactions or to receive credit for the purpose of redeeming fund units, on conditions different from those prescribed pursuant to section 65;
(5)direct on –
(a)conditions for the purchase and holding of assets as referred to in paragraph (1);
(b)conditions for the lending of securities as referred to in paragraph (2) or for carrying out a short sale transaction as referred to in that paragraph;
(c)conditions for the purchase, sale or creation of options or futures contracts as referred to in paragraph (3);
(d)conditions for carrying out credit transactions or for receiving credit as referred to in paragraph (4);
(e)the method of calculating the value of the assets, securities, options or futures contracts referred to in paragraphs (1) to (3) and their maximum rates; a direction regarding the method of calculating the value as aforesaid shall be given with regard to the provisions prescribed by the Minister of Finance pursuant to sections 43(b) and 50(b), if prescribed.
(b)A direction of the Authority pursuant to subsection (a) (in this section – directive) shall be for a period directed by the Authority not exceeding 18 months; where 18 months have elapsed and the special circumstances on account of which the immediate regulation as referred to in that subsection was required continue to exist (in this section – the special circumstances), the Authority may extend the validity of the directive for a further period directed by it not exceeding one year.
(c)Notwithstanding the provisions of subsection (b), where the special circumstances cease to exist before the end of the period prescribed by the Authority pursuant to that subsection, including the extension period, the directive shall expire.
(d)The Authority shall publish on its website a draft of the directive for public comment, a reasonable time before issuing the directive, and shall likewise publish the directive and the period of its validity, including its extension and expiry.
66.§
(Repealed — תיקון מס' 12, 2006)
Transaction between a Fund and Related Bodies§
67.
(a)A fund manager, a trustee, a controlling shareholder of either of them, a person holding ten percent or more of the issued share capital of either of them, or a company controlled by any of them, as well as a director, an employed person or an employee of a fund manager or of a trustee, a company controlled by any of them, or a company in which any of them has an interest or by which any of them is employed –
(1)shall not sell, in an off-exchange or off-regulated-market transaction, whether in Israel or outside Israel, or in a coordinated transaction, securities, foreign securities or options registered for trading thereon (in this section – traded securities) from its own account to the account of a fund managed by the fund manager, and shall not purchase for its own account, from the account of such a fund, traded securities in such a transaction;
(2)shall not sell from its holdings to the account of a fund as referred to in paragraph (1) an asset that is not traded securities, and shall not purchase for its holdings from the account of such a fund an asset that is not traded securities, unless the asset was offered by tender and the conveyance or the sale was made at the price determined in the tender; the Minister of Finance may prescribe in Regulations conditions for the tender.
(b)The provisions of subsection (a) shall not apply in respect of an asset remaining in the course of the period of realisation of a fund's assets in winding up, as referred to in section 109(c).
(c)Notwithstanding the provisions of subsection (a)(1), the Minister of Finance may prescribe cases and conditions in which a manager of an exchange-traded fund shall be permitted to enter into a transaction as referred to in that subsection, within the framework of an agreement with a market maker as defined in section 82(a)(6), even if the market maker is a company controlled by the controlling shareholder of the fund manager, provided that it does not control the fund manager and is not controlled by it.
Prohibition on Holding Units§
68.
(a)A fund manager shall not hold units of a fund that it manages, and a trustee shall not hold units of a fund for which it serves as trustee.
(b)Notwithstanding the provisions of subsection (a), the Minister of Finance may prescribe conditions and provisions regarding the purchase of units of a fund by the fund manager, generally, in respect of a high-technology fund, or in respect of other types of funds.
Tender for Engagement with a Trading Company§
69.
(a)A fund manager shall not enter into an agreement with a trading company for the payment of commissions from the assets of a fund under its management for the execution of transactions in the fund's assets, except by way of tender; in this section, "trading company" – a member of an exchange who executes transactions on behalf of others in one or more of the following: securities, options, futures contracts, foreign securities and foreign currency.
(b)A tender as referred to in subsection (a) shall be conducted in accordance with a procedure determined by the board of directors of the fund manager and approved by the trustee; the tender specifications and the selection of the winner shall be approved by the audit committee and the board of directors.
(c)Notwithstanding the provisions of subsection (a), a fund manager may enter into an agreement without a tender for the execution of transactions in foreign securities directly with a trading company that is a member of a foreign exchange, provided that the following conditions are met:
(1)the trading company has no affiliation with the fund manager; the examination of the affiliation shall be carried out in accordance with rules to be prescribed by the Authority;
(2)the engagement with the trading company is on conditions that are not inferior to the best conditions offered by a competitor who met the threshold requirements in the tender.
(d)Notwithstanding the provisions of subsection (a) and section 81(b), a fund manager may enter into an agreement without a tender as referred to in subsection (a) with a trading company that is a company controlling the fund manager or the trustee of the fund, or that is a company controlled by a person who controls the fund manager or the trustee of the fund (in this section – a related trading company, a trading company related to the fund manager, or a trading company related to the trustee, as the case may be), provided that the following conditions are met:
(1)the related trading company meets the threshold requirements set out in the tender;
(2)the commission to be paid to the related trading company for the execution of each type of transaction shall not exceed the commission to be paid to the winner of the tender for the execution of a similar transaction;
(3)the audit committee and the board of directors of the fund manager have approved the engagement after being satisfied that the engagement does not prejudice the interests of the unit holders and that it is on conditions that are not inferior to the conditions of the engagement with the winner of the tender.
(e)The fund manager shall not pay from the assets of the fund in a financial year of the fund, to trading companies related to the fund manager, together, or to trading companies related to the trustee, together, for the execution of transactions in the fund's assets, an amount exceeding twenty percent of the total commissions paid from the assets of the fund in that financial year for such transactions.
(f)The Authority shall prescribe rules on the following matters:
(1)the conduct of a tender pursuant to this section, as well as conditions under which a fund manager shall be exempt from conducting a tender in order to enter into an agreement as referred to in subsection (a) for a limited period;
(2)the conditions for engagement with a related trading company, including with respect to the amount of the commission to be paid to it for the execution of transactions in the fund's assets;
(3)additional matters required for the implementation of the provisions of this section.
(g)Rules prescribed by the Authority pursuant to subsections (c)(1) and (f) shall be published in Reshumot (Official Gazette).
Debiting and Crediting the Fund§
70.
A fund manager who has purchased an asset on behalf of a fund under its management or who has sold an asset from the fund's assets shall debit or credit the fund's account with the amount actually paid or received, on the day on which it paid or received the consideration for the asset, as the case may be.
Notification of Holding of Units§
71.
(a)Where a person who controls a fund manager, a company controlled by such a person, a director of a fund manager or an employee thereof, holds units at a rate in respect of which the Minister of Finance has prescribed a duty to submit a report, the fund manager shall submit a report thereon to the Authority and to the exchange at the time and in the manner prescribed by the Minister of Finance, and shall also submit a report on any change in the number of units so held.
(b)Where a person holds units of a closed-ended fund at a rate in respect of which the Minister of Finance has prescribed a duty to submit a report, the fund manager shall submit a report thereon to the Authority and to the exchange at the time and in the manner prescribed by the Minister of Finance, and shall also submit a report on any change in the number of units so held.
(c)A holder as referred to in subsections (a) or (b) shall submit to the fund manager a notification of the units held by it and of any change in their number, in the manner and at the times to be prescribed by the Minister of Finance in Regulations.
(d)Where a holder as referred to in subsections (a) or (b) has not submitted a notification as referred to in subsection (c), the court may, on the application of the fund manager, order it to submit such notification within a time to be fixed by the court.
Reports§
72.
(a)The Minister of Finance may prescribe by Regulations –
(1)additional reports beyond those specified in this Law that a fund manager and trustee are required to submit to the Authority, to the exchange, to a distributor or to any of them, the particulars to be included therein, the dates of their preparation, submission and their form, and such reports as aforesaid that they are required to publish in a newspaper or that must be sent to unit holders in the manner prescribed in subsection (e1);
(2)the particulars to be included in reports that a fund manager and trustee are required to submit pursuant to this Law, the dates of their preparation, submission and their form.
(a1)Where financial statements of a corporation that has given a guarantee for the fulfilment of a promise as to a certain redemption price of fund units have been included in a prospectus, the provisions of Chapter VI of the Securities Law shall apply to that corporation, with the necessary modifications, for so long as the guarantee is in force.
(a2)The Authority may prescribe by rules additional reports beyond those specified in this Law that a manager of a tracking fund and a trustee of such a fund are required to submit to it in light of the unique characteristics of such a fund, as well as the particulars to be included in such reports, the dates of their preparation, submission and their form.
(b)A fund manager and trustee are required to submit to the Authority, upon demand by it or by an employee whom it has authorised for that purpose, a report on an event or matter, if in the opinion of the Authority or of the employee information thereon is important to a reasonable investor considering the purchase or redemption of a unit, or the purchase or sale of a unit of a closed-ended fund; a demand as aforesaid may direct a fund manager or trustee as to the date of submission of such a report and the manner of its publication in a newspaper.
(c)A fund manager is required to furnish in writing to the Authority, upon demand by it or by an employee whom it has authorised for that purpose, explanations, particulars, information and documents in connection with the particulars contained in a report or notice pursuant to this Law, within a period to be determined by them.
(d)The Authority or an employee whom it has authorised may direct a fund manager, after affording the fund manager a reasonable opportunity to state arguments, to submit, within a period to be directed by either of them, a corrective report if either of them has found that a report was submitted otherwise than as required under this Law or if particulars furnished pursuant to subsection (c) require the issuance of such a direction.
(e)If the Authority or an employee whom it has authorised is satisfied that a fund manager is prevented from submitting a report pursuant to this Law by the date prescribed therefor, they may extend the date for its submission.
(e1)
(1)The Chairperson of the Authority may, if of the opinion that information contained in a report required to be submitted pursuant to this Law is of special importance to the unit holders of the fund, direct the fund manager to send the report to the unit holders holding units through the fund manager, at their addresses then known, and to notify the distributor through whom units of the fund are held that the distributor is required to send the report to the unit holders.
(2)Upon receipt by a distributor of a notice as referred to in paragraph (1), the distributor shall send the report, immediately upon receipt of the notice, to the unit holders holding units through the distributor, at their addresses then known.
(f)If a fund manager has not complied with a provision of this section, the court may, upon application by the Chairperson of the Authority, order the fund manager to comply therewith by a date to be determined.
(g)A person who has submitted a report or notice required to be submitted pursuant to this Law, or a person whose opinion or review has been included in such a report or notice, after having given prior written consent thereto, shall be liable towards a person who has purchased, redeemed, bought or sold units in a fund, in the course of trading on an exchange or otherwise, for damage caused by reason of a misleading particular contained therein, and the provisions of sections 39 and 40 shall apply, with the necessary modifications.
(h)(Repealed).
(i)A report submitted pursuant to a provision of this Law shall be open to public inspection at the principal offices of the fund manager and of the trustee, and any person shall be entitled to obtain a copy thereof, all subject to any other provision made in relation thereto under this Law.
Manner of Reporting to the Authority§
72a.
(a)A draft prospectus of a fund, a prospectus of a fund whose publication has been permitted and every report, opinion or confirmation included therein, as well as every report, notice, information or other document required to be submitted to the Authority pursuant to this Law, shall be submitted pursuant to Chapter VII-A of the Securities Law.
(b)A report required to be submitted pursuant to the provisions of this Law to the Authority and also to the exchange, as well as a prospectus of a fund whose publication the Authority has permitted, that have been submitted to the Authority as referred to in subsection (a), shall be transmitted by the Authority to the exchange, and submission to the Authority shall be deemed to also constitute fulfilment of the obligation to submit to the exchange.
Inspection of Documents and Certified Copies§
72b.
(a)A fund agreement, a prospectus of a fund whose publication has been permitted and every report, opinion or confirmation included in the prospectus, as well as every report submitted to the Authority pursuant to this Law, shall be open to public inspection at the Authority, and any person shall be entitled to inspect them and to obtain certified copies of what is registered therein, either through the Authority or through others whom the Authority has authorised for that purpose, all subject to any other provision made under this Law.
(b)A certified copy of a document submitted to the Authority shall be received in any legal proceeding as the original and shall constitute conclusive evidence that the original document is in the possession of the Authority; the provisions of this subsection shall also apply in respect of a printout of a document submitted to the Authority in the manner referred to in section 72a(a); for this purpose, "printout" – as defined in the Computers Law, 5755-1995.
Publication§
73.
(a)A fund manager shall not publish, nor cause the publication of, any matter relating to a fund under the fund manager's management unless the trustee has approved the publication and its content in advance; the provisions of this subsection shall not apply to a notice regarding the publication of a prospectus or to notices and reports required to be published in a newspaper.
(b)A fund manager, a person who controls the fund manager, or a company controlled by such a person, shall not publish nor cause the publication of –
(1)the return achieved by an open-ended fund or an exchange-traded fund, unless it has been calculated according to a formula prescribed by the Authority in directives and for a period prescribed by the Authority;
(2)any matter relating to a fund that contains a misleading particular.
(c)
(1)A fund manager, a person who controls the fund manager, or a company controlled by such a person, shall not publish nor cause the publication of any matter relating to a fund that is not under the management of the fund manager; nothing in the foregoing shall prevent the publication of data concerning all or most funds, carried out in accordance with directives under subsection (c1), or periodic reviews and analyses of fund data whose purpose is the provision of general information to the public.
(2)Notwithstanding the provisions of paragraph (1), a fund manager, a person who controls the fund manager, or a company controlled by such a person, may publish on the internet, in addition to data relating to the fund under the fund manager's management, also data relating to funds not under the fund manager's management, provided that the publication refers to all funds classified in the same classification as that of the said fund, in a publication carried out in accordance with the provisions of subsection (c1).
(3)The Minister of Finance may prescribe provisions concerning the particulars to be included in a publication as referred to in paragraph (2) and the periods to which the publication refers.
(c1)
(1)No person shall publish, nor cause the publication of, unit prices or unit redemption prices of all or most funds, or their returns, unless the funds are classified in the publication in accordance with provisions prescribed by the Minister of Finance by Regulations, and are presented in the publication in accordance with those Regulations.
(2)The Minister of Finance may prescribe provisions concerning the particulars to be included in a publication as referred to in paragraph (1) and the format of the publication, and may also prescribe that funds shall be classified in the publication in accordance with descriptive headings, including descriptive headings from a list of descriptive headings to be prescribed by the Authority from time to time.
(c2)A fund manager, a person who controls the fund manager, or a company controlled by such a person, shall not publish nor cause the publication of any matter relating to a closed-ended fund, that is not an exchange-traded fund, under the management of the fund manager, except for particulars required to be published pursuant to the provisions of any law.
(d)If the Authority is of the opinion that a publication relating to a fund contained a misleading particular, it may, after having afforded the person who caused the publication and the trustee a reasonable opportunity to state their arguments, direct the publication of a correction, in the manner and form it shall direct.
(e)In this section –
"fund manager" – including a person employed by the fund manager;
"to publish", "publication" – as defined in section 34x of the Penal Law, 5737-1977 (in this Law – the Penal Law).
Misleading Particular§
73a.
(a)A fund agreement, a prospectus, a report, a notice or a document submitted pursuant to this Law to the Authority (in this section – disclosure) shall not contain a misleading particular.
(b)An opinion, report, review or confirmation (in this section – opinion), included or referred to in a disclosure, with the prior consent of the person providing the opinion, shall not contain a misleading particular.
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