1.       "To hold, operate, develop, and manage the airports listed in the supplement… and to provide in them accompanying services for all these activities;

2.       To plan and construct an airport as specified in the master plan of the airports as approved by the Transport Minister – in accordance with the instructions of the Transport Minister given it after consultation with the Council;

3.       To take steps to ensure the security of the airports of the Authority, and of the persons, goods, aircraft, buildings, facilities, and equipment in them, in accordance with the instructions of the Transport Minister;

4.       To provide in a military airport… those services ordered by the Transport Minister in an order…"

The law specifies several directions for the Authority, the major ones lying in clause 5(c) and clause 7 of the law. It is stated in clause 5(c) that "When performing its functions and providing services in accordance with this clause, the Authority shall be guided by the principles of advancing and developing air transport, the efficiency of operation of the airports of the Authority, and the achievement and maintenance of a proper level of flight safety. It is stated in clause 7 that "a guide line for the activities of the Authority will be to manage all the airports and, as far as possible, each of them, on a basis of economic calculations and as a self-supporting concern."

The airports for which the Authority is responsible in accordance with the Airports Authority law are:

         Ben-Gurion airport

         Eilat Airport

         Jerusalem Airport (Atarot)

         Haifa Airport

         Yitzhak Ben Ya'akov Airport (Mahanayim)

         Herzlia Airport

Furthermore, in accordance with the orders issued by the Transport Minister and the Defense Minister, the Authority supplies services for civil aviation in two military airports:

         Dov Hoz Airport

         Ovda Airport

It is stated in the Airport Law (temporary measure) 5740-1980 (hereinafter, "the temporary measure") that the Airport Authority shall also hold, develop, and manage land transit terminals. Since 1980 the following transit terminals have been transferred for management by the Authority:

Border with Egypt:

         Rafiah Terminal

         Nitzana Terminal

         Taba Terminal

         Netafim Terminal (inactive)

Border with Jordan:

         Allenby Terminal

         Jordan River Terminal

         Arava Terminal

Border with the areas of the Palestinian Authority:

         Karni Terminal

         Erez Terminal (currently operated by the IDF)

The temporary measure states that the terminals will be financed independently by means of receipts from fees charged in the terminals and by additional means of income.

A protocol was signed on September 4, 1995, between the Authority and the Israeli Government regarding the financing of the operation and deployment of the land transit terminals (hereinafter, "the Safety Net Protocol"). According to the Safety Net Protocol the government made the following commitment: If a deficit is created in the activities of the terminals, the difference will be financed by the government. If the total income exceeds expenditure, i.e. a surplus is created in the activities of the terminals, the Authority will deduct the difference from the balance of the government debt for the investments.
As part of the government decision of September 2001, it was decided to extend the validity of the agreement until 31.12.03. (The extension of the agreement until 31.12.05 lies in final stages of approval.) The Safety Net Protocol regarding the Karni transit terminal will remain in force until 31.12.05.

The Authority acts through the Authority Council, the Director of the Authority, and its employees. The Council consists of 15 members appointed by the Transport Minister: 7 representatives of the public, 7 civil servants, and the Chairman of the council. The Director General of the Authority is appointed by the Council, in accordance with the proposal of the Transport Minister and with the approval of the government. The managers of the airports of the Authority are appointed by the Council with the approval of the Transport Minister and with the recommendation of the Director of the Authority.

The regular budget of the Authority is subject to approval by the Transport Minister and the Finance Minister, while the development budget is subject to the approval of the Transport Minister and the government. Apart from this, the Authority lies under the general supervision of the Transport Minister. As part of this supervision the Transport Minister may demand at any time a report and current information or one-time information regarding any matter related to the functions and authority of the Authority.

The amounts of the fees collected by the Authority from its customers, such as fees from incoming and outgoing passengers, landing fees, parking fees, etc., are specified in the regulations enacted by the Transport Minister with the approval of the government and of the Knesset Economic Committee. The Authority is authorized to provide service and collect payment for it even if no payment has been specified for it in the regulations and the provision of the said service is not obligatory by law. Furthermore, the Authority has additional income from various commercial activities, such as renting out commercial areas and offices and awarding franchises for operating duty free shops.

Since January 1997 the Airports Authority has been liable for tax just like a commercial company. In other words, it must pay companies tax at a rate of 36% of its taxable income. This change was included in the Law of Arrangements in the National Economy (Amendments to legislation to achieve budgetary aims) 5757-1996 (hereinafter, "the Law").

This law canceled clause 48 of the Authority law, that awarded it exemption from taxes similar to the status of the State.