Israel Securities Authority MAGNA – Electronic filing Natan Herscovitz, CIO December 2004

 Internet site:  Enforcement system: investigations and intelligence  Stock Exchange activity monitoring  GroupWare system  Electronic filing system Main computerization projects

 Establish a computerized system to receive and distribute, via the Internet, all reports required from the bodies supervised by the Securities Authority.  Main goal: to enhance investors’ confidence and encourage capital market investments Electronic Filing Project

 Prompt report publication, free of delays  Equal publication: information is accessible to the general public  The electronic report is the legally original document, not only a representation  Establish an archive system that stores documents indefinitely  Enable complete data retrieval according to a large variety of criteria  Enable queries and reports – a unique, sophisticated feature Filing System Goals

 Receive non-public reports for internal ISA use  Fully automatic distribution to Tel- Aviv Stock Exchange and various commercial information distributors  Uniform and standardized reporting  Very significant cost reduction for companies Filing System Goals

Architecture Reporting bodies Public Stock Exchange Reporting Site Electronic filing Information System (MAGNA) Distribution Site Securities Authority Information Systems Document Management System GroupWare Forms Reports Docs Data Docs Data Docs Received Docs Data Data Security

 Large amount of data: General project characteristics financial reports immediate reports transactions with controlling shareholders private placements acquisitions  Forms for companies, investment advisors and portfolio managers  In total, hundreds of thousands of report pages per year private placements Prospectuses Change of holdings Tender offers

 Thousands of reporting bodies, throughout Israel, with several persons in each appointed to fill reports  Short schedule: approximately one year to set up the system from kickoff to full production  Extensive integration and tutoring project  Service offices for assistance in reporting  Help Desk providing user support by phone General project characteristics

 Some of the world’s most advanced technologies, never used in any computer system before  Complex interfaces to internal and external systems  Advanced procedures: Individually tailored report forms: reporting body identification and data downloads Report type identification Report fields Identification Sent reports are encoded and signed Completeness testing Service offices Project Characteristics — Software Development

 Availability and reliability:  99.95% up time  No Single Point Of Failure  Computer room organization  DRP: Disaster Recovery Plan  Alternative site in case of crash or disaster, located in another city  Unique control & management system for hardware, software and business process control Project Characteristics — Hardware and Communications

 System must provide: Identification Authentication Non-Repudiation Non-Disclosure Protection against intrusion Protection from viruses and vandals Protection of internal ISA information systems Interface protection Project Characteristics — Required Data Security

 Solutions used to achieve the above requirements: PKI (Public Key Infrastructure) Technologies Use of external and independent Certification Authority, approved by law Use of USB Token as a cryptographic device Use of GAP technology for physical separation as part of the PKI authentication process, including content inspection Software security Firewalls by various vendors Intrusion detection packages Anti-Virus software Security control and management system Project Characteristics — Data Security solutions

 Getting underway Registration Integration Fully operational since Nov. 16 th 2003  Further stages: Funds and investment counsel Red flags Electronic Filing Project