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Financial Institution Security Measures in Israel: Regulatory Overview
Amazon Web Services (AWS) has outlined the legal and regulatory requirements that may apply to its services for financial institutions in Israel. This comprehensive guide aims to provide AWS customers with information on the regulations governing their use of cloud services.
Who are the Financial Regulators in Israel?
Israel’s financial sector is governed by multiple regulators, each responsible for a specific aspect of financial activity or business service. The following regulators play a crucial role:
- Bank of Israel: regulates banking activities and payment systems
- Capital Market, Insurance and Savings Authority (CMISA): oversees non-bank providers of financial assets and their related services
- Israel Securities Authority (ISA): regulates public companies listed on the Israeli Stock Exchange and mutual funds
- Privacy Protection Authority: regulates data protection and security
- Israel National Cyber Directorate (INCD): responsible for all aspects of civilian cyber defense
What Regulations Apply to Financial Institutions in Israel Using AWS?
Financial institutions in Israel using AWS may be subject to various regulatory requirements, including those related to outsourcing arrangements. To ensure compliance, financial institutions should:
- Develop an operational risk management framework that integrates with overall management processes
- Key regulations include:
- Bank of Israel directives for banking corporations
- CMISA guidelines for non-bank providers of financial assets
- ISA regulations for public companies listed on the Israeli Stock Exchange
- Privacy Protection Authority guidelines for data security
Data Residency and Transfer
Financial institutions in Israel should be aware that the Data Transfer Regulations allow for data to be transferred and stored in regions with equal or more stringent data protection regulations. However, customers should note that the regulations prohibit onward transfer of personal data by the original foreign recipient.
AWS has announced the launch of its Israel (Tel Aviv) Region, providing financial institutions with greater control over their data residency and processing needs.
Steps to Ensure Compliance
Financial institutions using or planning to use AWS services can take the following steps to better understand their compliance needs:
- Develop an operational risk management framework that integrates with overall management processes
- Perform a risk assessment before engaging the provider and periodically thereafter
- Review the AWS Shared Responsibility Model and map AWS responsibilities and customer responsibilities for each service used
- Assess policies and processes, updating governance frameworks as needed
Additional Resources
AWS provides various resources to support financial institutions in their compliance efforts:
- AWS Operational Resilience in Financial Services Guide
- AWS Policy Perspective: Data Residency
- AWS Logical Separation Handbook
- Financial Services Lens - AWS Well Architected Framework
Compliance Programs
Customers with questions about regulatory guidelines and how they may apply to their use of AWS services can contact their account representative or reach out to AWS.
Disclaimer
This document is provided for informational purposes only and does not create any warranties, representations, contractual commitments, conditions, or assurances from AWS or its affiliates.