The securities sector in Palestine emerged in 1995 when the Palestine Securities Exchange was set up as a private company by PADICO, after the Palestinian National Authority agreed to proceed with the implementation of the project to establish a market and thus signing an agreement to operate the market in 1996. Tuesday, February 18, 1997 witnessed the 1st trading session within the market.
PEX has provided, from the onset, a set of rules and regulations that organized the work of the securities sector in Palestine, in addition to the latest electronic systems for monitoring, trading, settlement and transfer of securities. Moreover, PEX was subjected to the supervision of the Palestinian Ministry of Finance since its establishment until 2005, when the Palestine Capital Market Authority was set up.
The year 2004 witnessed the issuance of the securities law No. “12" and the law of the Capital Market Authority No. “13" for the year 2004.
In 2005, Palestine Capital Market Authority was established as an autonomous agency by Law No. “13" of the year 2004, thus, becoming the agency that organizes, supervises and controls the capital markets in Palestine. A set of resolutions and circulars were issued governing the functioning of the securities sector regarding the issuance, disclosure, control, licensing and trading commissions. It has also kept pace with the main developments and legislations in the securities sector through the implementation of the instructions approved the Board of Directors.
In accordance with the Securities Law No. “12" and the Capital Market Authority Law No. “13" for the year 2004, Palestine Securities sector consists of the below-mentioned bodies supervised and controlled by PCMA. They are enclosed as the following:
- Palestine Exchange and the Centre of Depository and settlement.
- Public-shareholding companies.
- Securities companies' members of the Palestine Exchange.
- Financial professionals.
- Investment funds.
During the year 2013, the General Directorate of Securities achieved a series of achievements, which were culminated when PCMA was admitted as an ordinary member in the International Organization for Securities Commissions (IOSCO), in addition to the accession of the State of Palestine, represented by PCMA, as a signatory of MMOU. Furthermore, PCMA has developed the legal and regulatory framework of the securities sector in Palestine, where the BOD in its meeting No. 05/2013, approved the issuance of the management instructions and auditing in the securities companies. These instructions were given to the securities companies for a period of six months from the date of entry in order to reconcile situations, meet the requirements and comply with these instructions. PCMA has also issued a decision regarding the maximum limits for the fluctuation of securities prices and the extension of the continuous trading session period, so that the margin of the price volatility of securities is 7.5% in primary market and 5% in secondary market, in addition to the adjustment in the continuous trading session period and any related periods.
During the year 2019, PCMA issued Instructions No. “1" for the year 2019 regarding dealing in securities and Instructions No. “2" related to licensing the Custodian and approved the Palestine Stock Exchange request regarding the reducing of trading ceiling for member companies to half a million US dollars, in addition to start updating other instructions which are expected to be issued during the current year 2020. On the other hand, and in light of the General Directorate of the Securities Department's endeavor to develop electronic control systems, during that year, the Trading Control staff have developed oversight reports internally based on the outcome of their experiences in the areas of trading and central securities depository.
According to Anti- money Laundering and Terrorist Financing, and the anticipated preparation for the mutual evaluation process for the state of Palestine, the operating companies in the securities sector have developed working papers and risk files aiming to combat Anti- money laundering and terrorist financing operations ,where the first inspection specialized in combating money laundering and terrorist financing operations was carried out on the financial companies members and Palestine Stock Exchange. Parallel to that, the PCMA has drafted indicative proposals that have worked to translate suspicion indicators in anti-money laundering and terrorist financing legislation within specific digital standards, which are automated by member companies.
By the end of the year 2019, Al-Quds index closed at 526 points, recording a decrease of 0.6% from its closing at the end of 2018, which was 529.4 points. While the market value reached US 3,757.5 million dollars at the end of 2019, to achieve an increase of 0.6% over the previous year. The number of the listed companies in the Palestine Exchange reached 48 companies at the end of 2019.