THE US-ISRAEL LEGAL REVIEW 2019

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4 The US-Israel Legal Review 2019
ISRAEL’S LEGAL SYSTEM
“Agood lawyer knows the law but a great lawyer
knows the judge”. While this famous phrase
is usually quoted, humorously, with a negative
connotation, the “great lawyer” is in fact the expert
who, not only knows the law, but also understands
and is intimately familiar with its background,
accepted interpretations and applicability by the
local market, judges and relevant authorities.The intention of this article is to focus on several
areas which should not be overlooked by U.S.
and other foreign lawyers when engaging Israeli
law firms for specialist advice in the context of
investments and M&A transactions involving
Israeli targets.This article will also highlight certain important
new legislative changes which demonstrate the
fluidity of the Israeli legislature and then refer to
other aspects generally relevant for transactions in
Israel.
ANTITRUSTIn any substantial acquisition, it is necessary to
obtain antitrust advice both in connection with
obtaining merger approval for the contemplated
transaction as well as with respect to the legality
and enforceability of non-competition provisions.
Effective as of January 1, 2019, there have
been significant amendments to the Economic
Competition Law (formerly known as the Antitrust
Law) which include increasing the threshold
which requires the transacting parties to apply
for approval, to an aggregate joint sales turnover
of NIS 360 million (equivalent to approximately
US $94 million) in place of the previous threshold
of NIS 150 million. Other standards, such as
the minimum NIS 10 million (equivalent to
approximately US $2.6 million) threshold for each
of the merger parties remain unchanged but it is,
of course, important to be aware of all aspects that
can affect the deal.Aside from the approval process for transactions,
the Israeli Competition Authority (formerly known
as the Antitrust Authority) is active in enforcing
against companies and their officers for various
offences such as cartels, insider trading and abuses
of a monopoly position. Incidentally, a monopoly is
now defined by “significant market power” with
the respect to the supply or purchase of goods or
services, and not just by virtue of its holding more
than 50% of a particular market.It is particularly important to note that laws
have recently become more stringent in terms of
directors’ responsibility for compliance, not just
with antitrust laws and regulations, but also with
respect to compliance with other areas of the law,
such as privacy/data protection, health & safety,
sexual harassment and so forth.
PRIVACY AND DATA PROTECTIONAnother important recent focus is privacy and
data protection law and regulations. Although the
United States and European Union also have strict
privacy regulation, to varying degrees, certain
key obligations under Israeli law exceed even the
European Union’s recently effective General Data
Protection Requirements (which, it is important
DoingBusiness in the Ever-
Changing Israeli Legal
System