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Conflicts of Interest Policy
We are required to identify and manage conflicts of interest which arise in the performance of our
functions. Since we do not:
(a) give advice to investors;
(b) arrange for investors to transfer or sell Israel bonds;
(c) derive any incentive based on the value of Israel bonds issued or sold;
(d) operate any priority in the processing of instructions from our clients to purchase Israel bonds; or
(e) remunerate our staff in a way which directly reflects the number or value of Israel bonds sold
It is our view that conflicts of interest between ourselves and any client likely arise only in highly exceptional circumstances (which we will manage on a case by case basis), and conflicts between our clients are unlikely to arise. If we consider that a conflict has arisen, we will inform the client immediately and seek to manage or resolve the matter in a fashion which mitigates the conflict to the extent possible
and has no financial effect on the client and is in the client’s best interests.
Specified Conflicts of Interest Table
This is a list of potential conflicts of interest that DCI may face among DCI, its sales staff, its other employees and its clients. “DCI” refers to both Development Company for Israel (International) Ltd. and Development Company for Israel (Europe) GmbH. Also included below is the method for minimizing or eliminating the conflict, actions expected of employees and actions to be performed by management and/or the compliance officer.
Potential Conflict
Method to minimize or
eliminate the conflict
Action that employees should take if conflict is identified
Management/ compliance officer action
Sales staff selling
bonds with shorter
maturities to
encourage more
frequent reinvestment
Disclosure to client
of various maturities
available and rates
Sales staff should discuss
with client the various
maturities and rates
available for the size of
purchase so that client
can make purchase most
aligned with their goals
Review transactions
and employee notes
to review if purchases
are not in the interest
of customer
Employee’s outside
activities conflict with
their duties in the firm
Employee’s outside
activities or role in
the firm limited to
minimize or
eliminate conflict
Prior disclosure of
outside activities to
compliance officer
Evaluate the potential
limitations on
employee’s activity
either in the firm or in
performing the activity
Clients of DCI
supply goods or
services to DCI
Have different
employees interface
with entity as
purchaser of
goods/services as
compared to sales
staff who service
entity as client
Identify to compliance
officer which clients
supply goods or services
to DCI
Impose limitations so
that bonds purchase
and supply
relationship are
separate
Performance-related
remuneration may
encourage sales
promotion beyond
what would be
appropriate
High pressure sales
tactics are prohibited
Sales staff and
marketing shall not
employ high pressure
sales tactics
Compliance officer
reviews all marketing
materials and reviews
a sampling of emails
Gifts may
inappropriately affect
activities of Sales staff
or other employees
Employees may not
solicit or accept gifts or
gratuities from clients or
other persons with
business dealings with
DCI without approval of
the compliance officer
Report gifts to
compliance officer
Compliance officer
does not approve
receipt of gifts which
creates a conflict of
interest
Clients of DCI are
owned by DCI
employees (all or a
portion)
Have different
employees interface
with entity as owner and
sales staff that services
entity as client
Identify which clients of
DCI are owned by DCI
employees (all or a
portion)
Impose limitations so
that bonds purchase
and ownership
relationship are
separate and
restricted
The State of Israel is
the sole source of
income of DCI, which
can cause DCI to prefer
the interests of the
State of Israel over the
interest of its client,
especially in relation to
sales activities and
their intensity as well as
in inappropriately
expanding the target
market of certain types
of Israel bonds
Sales to a client not in
the client’s best interest
are prohibited.
Marketing Israel bonds
outside of their target
audience is prohibited
Sales staff shall not sell
to a client an Israel bond
not in the client’s best
interest. Marketing shall
not market Israel bonds
outside their target
audience
Compliance officer
reviews all marketing
materials and a
sample of employees’
emails. There is no
compensation for
selling one type of
bond instead of
another.
Employees could act
upon material
non-public information
received through the
normal course of DCI’s
business
Employees are
prohibited from acting
on material non-public
information
Immediately report any
material non-public
information received to
the compliance officer
Compliance officer
reviews a sample of
employees’ emails
DCI has created a comprehensive compliance organization for prevention and avoidance of conflicts of interest in general and in particular the aforementioned conflicts. Therefore, the compliance organization will follow the following preventive measures:
-
- The State of Israel as the issuer does not request special sales activities for any single type of Israel bond. Supply and demand for specific types of Israel bonds and therefore the sales of these bonds are managed and controlled by the State of Israel lowering or increasing the interest rate or suspending a bond from sales activities. This reduces the risk of promoting the interest of the State of Israel as the single source of DCI's revenues. The managing director as well as the compliance officer monitor that employees promote the interests of the purchaser when receipting and transmitting orders in Israel bonds.
- The remuneration of DCI under its agreement with the State of Israel provides compensation for the distribution activities of DCI and is not related to the volume of sales or any other success in relation to the sales activities of DCI. Thus, there is also no incentive to sell Israel bonds to an inappropriate target market which would promote the interest of DCI to sell Israel bonds ahead of the interests of clients.
- Company guidelines and policies specify that certain employees are not compensated on the basis of sales success by DCI, including the internal auditor (who is employed by an affiliate of DCI) and the finance staff. The compliance function monitors the organization, structuring and implementation of DCI's remuneration system. DCI's remuneration structure to sales staff is not commission based. Each salesperson receives a salary and a small bonus on the basis of achieving specified targets that relate to their area of focus. There is no compensation for selling one type of bond instead of another. Thus, there is also no advantage to a salesperson or to the organization to sell one type of Israel bond instead of another. This limits the risk of selling an inappropriate type of Israel bond to a client.
- DCI's employees are given regular training including in compliance issues. In addition, the following internal rules apply:
- Employees are obligated to report immediately to the compliance officer any circumstances involving or which could lead to a conflict of interest.
- In particular, employees should avoid any activities or relationships that create a conflict or an apparent conflict with their duty to act in the best interest of DCI or DCI’s clients. An employee must also avoid conflicts of interest arising from actions of his or her immediate family members.
- The DCI is audited by internal audit and an external auditor. Additionally, the compliance officer reports at least once yearly to the managing director on compliance issues and substantial violations in the observance of rules and regulations.
Copyright © 2025 Development Company for Israel (International) Ltd. / Development Company for Israel (Europe) GmbH. All Rights Reserved.
This website shall not constitute investment advice in any form.
For sales outside of the European Union, the United States and Canada:
Development Company for Israel (International) Ltd.
Authorised and regulated by the Financial Conduct Authority.
For sales in the European Union:
Development Company for Israel (Europe) GmbH
Competent supervisory authority: Bundesanstalt für Finanzdienstleistungsaufsicht www.bafin.de
French branch of Development Company for Israel (Europe) GmbH
Competent supervisory authority: Bundesanstalt fuer Finanzdienstleistungsaufsicht www.bafin.de, and Autorité des Marchés Financiers www.amf-france.org
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