IDE in Final Stages of new Tower Negotiations

Israel Diamond Exchange (IDE) President Avi Paz told IDEX Online in an interview that he hopes to announce in a few days the signing of an agreement to build a new tower that will be connected to the existing four buildings of the bourse. He also says that he is urging the DTC to adjust its client profile to better reflect regional advantages.

He says a number of companies have already decided to move to Israel. The country offers lower taxes compared to European countries such as Belgium and France and freedom from an anti-Semitic climate that is disturbing Jews in Europe.

Israel, he adds, also offers practical solutions. With the aid of the Ministries of Immigrant Absorption, Housing, and Education medium-sized businesses receive help in making the transfer.

The increased business activity that will result from the move requires additional bank credit. The State Bank of India (SBI), which has just received its draft license from the Israeli Supervisor of Banks, is about to fill this need. According to Paz, the Exchange has already reserved a space in one of its buildings for the bank.

Shortly after assuming his post, Paz found himself at odds with DTC Managing Director Gareth Penny. The two met in London to work out several issues, including increased rough supplies to the country after the DTC decided not to accept the bid of several Israeli firms to become Sightholders.

At the meeting he suggested to Penny adjusting the client profile, the application to become a Sightholder, to reflect regional advantages. “Each market has it own attributes,” he says. He wants to see the DTC adapting the profile to the Israeli market in 2008, when the next Sightholder selection will take place. “We will discuss this with (DTC Managing Director Designate) Varda Shine when we meet.”

Regarding discussions with the Israeli tax authorities over Anti Money Laundering (AML) laws, Paz says he wants Israel to meet U.S. AML law requirements. “I see great danger in closing our eyes to that market.

“We have an opportunity and the ability to talk with the (Israeli) Money Laundering Authority, and we are in full cooperation. We want to arrive at a solution quickly.

“We met with representatives of the banks this morning (Wednesday) to hear from them their ideas and requirements.”

Paz hopes the law in Israel will be drafted quickly because the AML laws in the U.S. go into effect on January 1. This leaves the Israeli authorities very little time if the law is to be approved by December 31 of this year.