The new controversial Civil Procedure Regulations recently entered into force. Insurers' claims departments must study and understand these new procedures, which may cause increased uncertainty during the first years of implementation. In the meantime, plaintiffs – including insurers in subrogation claims or claims for contribution – must prepare their claims more thoroughly with all supporting documents and opinions.
The new controversial Civil Procedure Regulations recently entered into force. The Ministry of Justice initiated this reform, declaring that it aims to make the judicial process more efficient and transparent. However, under the regulations, litigation will be costlier and the courts' stringent attitude may lead parties to mediate and settle claims instead of filing them in court.
Among the primary tools for encouraging inbound investments in Israel is the special tax regime for private investment funds. Over the years, the Tax Authority has issued substantial guidance and numerous private rulings under the Income Tax Ordinance, providing significant tax benefits to foreign investors and private investment funds operating in Israel. This article outlines the income tax arrangements applicable to private investment funds operating in Israel.
In August 2020 the Central District Court dismissed several requests for the certification of class actions which had been filed against different airlines on the basis that statutory damages under the Aviation Services Law cannot be claimed in class actions. In all of the cases, the airlines' main argument was that according to the Class Action Law, the court cannot award compensation where proof of damage is not required.
The controversy over whether electric bicycles are motor vehicles and are hence subject to the Law of Compensation to Victims of Road Accidents recently came to an end with a Supreme Court ruling. Since electric bicycles are involved in many accidents, the question of whether the law applies has become important because if electric bicycles were to be considered motor vehicles, there would be a duty of insurance.
Recent years have seen a significant increase in publicly raised capital on the stock market by partnerships engaged in oil and gas exploration, which presents challenges due to existing tax legislation in Israel. In general, the process established in the law creates a distortion under which present partners will pay additional tax for past partners who benefited from the partnership's profits in a particular year.
The Competition Tribunal's recent judgment thoroughly analysed the legality of target discounts offered by a dominant firm to its customers. The tribunal adopted a cautious approach towards retroactive target discounts, ruling that such pricing schemes could be condemned even if an equally efficient competitor was not excluded by the target discount and the level of market foreclosure was limited.
In response to the COVID-19 pandemic, Israel imposed significant restrictions on foreign nationals' entry into Israel. The Population and Immigration Authority and the Ministry of Health recently published a procedure that allows executives and businesspeople from so-called 'green countries' to obtain a permit to visit Israel for business visits of up to seven days.
A recent case dealt with the question of whether an insured is entitled to insurance benefits for the loss of their car by theft when it lacked the security measures required by the insurer. The Insurance Contract Law enables the award of partial benefits (Article 18), but in this case the insurer presented no evidence to support the application of this remedy. Thus, the court ordered the insurer to pay the full claim.
The Supreme Court recently answered a crucial question which could affect the reserves for bodily injury claims of all Israeli insurers and hence affect their balance sheets. According to the decision, the relevant annual capitalisation interest that should apply in respect of subrogation claims filed by the National Insurance Institute (NII) is 3% regardless of the fact that the NII paid allowances to the injured based on an annual capitalisation interest of 2%.
The Tax Authority recently published a tax ruling addressing priority technological enterprise status with respect to an Israeli company that engages in the development and provision of cloud service platforms. The ruling provides that, subject to the Investment Law, income derived from the right to use a company's cloud platforms will be classified as income generated by a technological enterprise and, therefore, will be entitled to the Investment Law's reduced tax rates.
Parliament recently passed the Equal Pay Law for Male and Female Workers (Amendment 6) (5780-2020), which aims to prevent discrimination based on sex with respect to salary and other work-related benefits. The law is based on the presumption that female and male workers employed at the same workplace should receive equal pay for the same work or for substantially similar work and provides another tool to remedy the gender pay gap.
According to Israeli law, companies can hire employees via third-party providers, which are then responsible for fulfilling employers' various statutory obligations. Such third-party providers are referred to as 'service and manpower companies'. However, Israeli law provides that if a manpower company's employee continues to provide services to another company under this arrangement for more than nine months, the latter will be considered to be the actual employer.
In November 2017 the Supreme Court approved a district court's decision that a foreign insurer which is not licensed under the Supervision Law is not entitled to file a subrogation claim in Israel. Notably, the Supreme Court is expected to readdress this decision in the near future. In view of its problematic outcome, it is hoped that the court will take this opportunity to reconsider its position and set a new and fairer precedent.
Potential exposure arises from companies' engagement of consultants because, following termination of the consultancy, the consultant may claim employee status and associated social benefits. The labour courts have established criteria for determining whether a consultant should be considered an employee, including the degree of the consultant's integration into the company and its activities.
Due to the COVID-19 outbreak, as of March 2020, Israel prohibited foreign nationals from any country from entering its borders, including citizens who held any kind of visa. Only foreign residents who could prove that their 'life centre' was in Israel could enter the country. In June 2020 the Population and Immigration Authority published a list of exceptional cases in which it will allow foreigners into the country. This article outlines these exceptional cases.
Has the COVID-19 pandemic led to the filing of insurance class actions which are typical of such crises? This article discusses class actions relating to motor, business and apartment insurance based on the allegation that the insureds paid monies (eg, premiums) for a period during which they did not enjoy any or full consideration for these payments.
The Israel Tax Authority (ITA) recently published a tax circular to clarify cases in which a transfer pricing study filed by a taxpayer will be considered to fulfil legal requirements and thus shift the burden of proof in the assessment process framework to an ITA inspector, in contrast to the general rule that the burden of proof rests with the taxpayer.
The attorney general (AG) recently submitted his opinion regarding the applicability of the excessive pricing prohibition under Israeli law and the appropriate test for its application. Adopting the Israeli Competition Authority's current opinion regarding excessive pricing while opposing the broad approach taken by the court in the Central Bottling Company case, the AG maintained that the Supreme Court should determine that the Competition Law prohibits monopolists from setting unfairly high prices.
Temporary amendments to the Aviation Service Law were recently presented to Parliament to help airlines deal with customer compensation claims during the COVID-19 pandemic, while industry players are also in discussions with the Ministry of Finance about possible government assistance. This video discusses these issues as well as the ever-increasing number of class actions filed against airlines in Israel over the past decade.