Israel
Israel is a developed country and an OECD member, and has a population of over 9 million people. It has the world's 29th-largest economy by nominal GDP, and is the most developed country that is currently in conflict. The standard of living in Israel is the highest in the Middle East, and the country ranks very high on the global HDI list (19th). Israel also ranks among the world's top countries by percentage of citizens with military training, percentage of citizens holding a tertiary education degree, research and development spending by GDP percentage, women's safety, life expectancy, innovativeness, and happiness.
Israel is considered the most advanced country in Western Asia and the Middle East in economic and industrial development. Israel's quality university education and the establishment of a highly motivated and educated populace is largely responsible for spurring the country's high technology boom and rapid economic development
Israel has the second-largest number of startup companies in the world after the United States, and the third-largest number of NASDAQ-listed companies after the U.S. and China. Intel and Microsoft built their first overseas research and development facilities in Israel, and other high-tech multi-national corporations, such as IBM, Google, Apple, Hewlett-Packard, Cisco Systems, Facebook and Motorola have opened research and development centres in the country. In 2007, American investor Warren Buffett's holding company Berkshire Hathaway bought an Israeli company, Iscar, its first acquisition outside the United States, for $4 billion.
Government policy is aimed at providing investment incentives to industries which increase the country’s exports and create jobs. There are limited restrictions on sectors in which a foreign investor may invest, other than where there are defence considerations.
Prior approval for an investment is generally not required except for investment in regulated bodies such as banks and insurance companies.
Israel is also committed to the principles of free trade, shown by the large number of free trade agreements to which it is party.
Israeli business associations actively seek overseas partners for investing in Israeli companies. In the light of the relatively small domestic market in Israel, export opportunities and international business connections are very important to Israeli businesses. They are generally supportive of government policy regarding incentives and often view foreign investors as a further opportunity to expand business and improve standards, rather than as a competitive threat.
To reach its goals, Israel offers substantial benefits, incentives and concessions through various laws and regulations more fully discussed below. These incentives are available to both foreign and Israeli investors. The main exceptions are where, in certain cases, larger tax reductions are available to foreign-owned enterprises compared with Israeli-owned enterprises; and the income from foreign currency deposits of foreign investors held in Israeli banks is tax exempt.
The government’s major tools for foreign investment are the Encouragement of Capital Investment Law and the R&D Industrial Encouragement Law, through which grants of 20–66% of a project’s total expenditure are available.
Many international corporations, such as Microsoft, IBM, Intel, Motorola and other companies have invested over the past several years in high-tech industry in Israel by either purchasing Israeli companies or by establishing their own subsidiaries in Israel.
Several Israeli high-tech start-up companies have drawn the attention of the world market and investors because of their remarkable worldwide success in both technical and financial arenas.
Because of increasing interest among investors in high-tech projects, involvement of venture capital funds has significantly increased. The success of Israeli high-tech companies and the availability of venture capital funds have motivated young Israeli entrepreneurs to open their own high-tech companies. Venture capital fund managers support the company in which they invest by providing information, advice and ‘opening doors’ throughout the world to promote the business of the company.
Israel has a well-developed and modern banking system which provides a wide range of banking, financial and credit services. The following features characterise the system:
-A high degree of market concentration, with two major banking groups accounting for approximately 60% of the total assets of commercial banks in Israel. These two groups are Bank Leumi and Bank Hapoalim. Three other significant banking groups are Israel Discount Bank, Mizrahi Tefahot Bank and First International Bank of Israel which account for another 33%
-Liquidity regulations (currently being eased) which limit the volume of free creditavailable to the public
-A relatively high level of international activities and interaction with major foreign banksby Israeli commercial banks.
In general, Israeli taxes can be classified into three major categories:
-Income tax
- Capital gains tax
- Value added tax (VAT).
Israel employs the classical system of corporate taxation, in which income is taxed at the corporate level and upon distribution to shareholders. A partnership is not a taxable entity; items of income and loss are passed through to the partners.
Intellectual property (IP) is a key driver of the innovation-based Israeli economy. The IP laws are a combination of such which are a product of the original Israeli legislation and others that are amended and updated versions of British legislation during the British mandate over of Palestine (1920-1948).
In respect of counterfeits for example, rights holders can enforce their IP right, with the availability of expeditious judicial interim relief and the possible assistance of governmental agencies such as the police and the customs authority.
Israel's legal system combines three legal traditions: English common law, civil law, and Jewish law. It is based on the principle of stare decisis (precedent) and is an adversarial system, where the parties in the suit bring evidence before the court. Court cases are decided by professional judges with no role for juries.
Israel has a three-tier court system. At the lowest level are magistrate courts, situated in most cities across the country. Above them are district courts, serving as both appellate courts and courts of first instance; they are situated in five of Israel's six districts. The third and highest tier is the Supreme Court, located in Jerusalem; it serves a dual role as the highest court of appeals and the High Court of Justice. In the latter role, the Supreme Court rules as a court of first instance, allowing individuals, both citizens and non-citizens, to petition against the decisions of state authorities. Although Israel supports the goals of the International Criminal Court, it has not ratified the Rome Statute, citing concerns about the ability of the court to remain free from political impartiality.
Our law firm VLO provides legal services for corporate and private clients in Israel. These services include mergers and acquisitions, business and debt restructuring, tax and tax disputes, corporate disputes, investments, bankruptcy, litigation and arbitration.
If you have questions, please us right now.
E-mail: vlolawfirm@gmail.com
Israel is considered the most advanced country in Western Asia and the Middle East in economic and industrial development. Israel's quality university education and the establishment of a highly motivated and educated populace is largely responsible for spurring the country's high technology boom and rapid economic development
Israel has the second-largest number of startup companies in the world after the United States, and the third-largest number of NASDAQ-listed companies after the U.S. and China. Intel and Microsoft built their first overseas research and development facilities in Israel, and other high-tech multi-national corporations, such as IBM, Google, Apple, Hewlett-Packard, Cisco Systems, Facebook and Motorola have opened research and development centres in the country. In 2007, American investor Warren Buffett's holding company Berkshire Hathaway bought an Israeli company, Iscar, its first acquisition outside the United States, for $4 billion.
Government policy is aimed at providing investment incentives to industries which increase the country’s exports and create jobs. There are limited restrictions on sectors in which a foreign investor may invest, other than where there are defence considerations.
Prior approval for an investment is generally not required except for investment in regulated bodies such as banks and insurance companies.
Israel is also committed to the principles of free trade, shown by the large number of free trade agreements to which it is party.
Israeli business associations actively seek overseas partners for investing in Israeli companies. In the light of the relatively small domestic market in Israel, export opportunities and international business connections are very important to Israeli businesses. They are generally supportive of government policy regarding incentives and often view foreign investors as a further opportunity to expand business and improve standards, rather than as a competitive threat.
To reach its goals, Israel offers substantial benefits, incentives and concessions through various laws and regulations more fully discussed below. These incentives are available to both foreign and Israeli investors. The main exceptions are where, in certain cases, larger tax reductions are available to foreign-owned enterprises compared with Israeli-owned enterprises; and the income from foreign currency deposits of foreign investors held in Israeli banks is tax exempt.
The government’s major tools for foreign investment are the Encouragement of Capital Investment Law and the R&D Industrial Encouragement Law, through which grants of 20–66% of a project’s total expenditure are available.
Many international corporations, such as Microsoft, IBM, Intel, Motorola and other companies have invested over the past several years in high-tech industry in Israel by either purchasing Israeli companies or by establishing their own subsidiaries in Israel.
Several Israeli high-tech start-up companies have drawn the attention of the world market and investors because of their remarkable worldwide success in both technical and financial arenas.
Because of increasing interest among investors in high-tech projects, involvement of venture capital funds has significantly increased. The success of Israeli high-tech companies and the availability of venture capital funds have motivated young Israeli entrepreneurs to open their own high-tech companies. Venture capital fund managers support the company in which they invest by providing information, advice and ‘opening doors’ throughout the world to promote the business of the company.
Israel has a well-developed and modern banking system which provides a wide range of banking, financial and credit services. The following features characterise the system:
-A high degree of market concentration, with two major banking groups accounting for approximately 60% of the total assets of commercial banks in Israel. These two groups are Bank Leumi and Bank Hapoalim. Three other significant banking groups are Israel Discount Bank, Mizrahi Tefahot Bank and First International Bank of Israel which account for another 33%
-Liquidity regulations (currently being eased) which limit the volume of free creditavailable to the public
-A relatively high level of international activities and interaction with major foreign banksby Israeli commercial banks.
In general, Israeli taxes can be classified into three major categories:
-Income tax
- Capital gains tax
- Value added tax (VAT).
Israel employs the classical system of corporate taxation, in which income is taxed at the corporate level and upon distribution to shareholders. A partnership is not a taxable entity; items of income and loss are passed through to the partners.
Intellectual property (IP) is a key driver of the innovation-based Israeli economy. The IP laws are a combination of such which are a product of the original Israeli legislation and others that are amended and updated versions of British legislation during the British mandate over of Palestine (1920-1948).
In respect of counterfeits for example, rights holders can enforce their IP right, with the availability of expeditious judicial interim relief and the possible assistance of governmental agencies such as the police and the customs authority.
Israel's legal system combines three legal traditions: English common law, civil law, and Jewish law. It is based on the principle of stare decisis (precedent) and is an adversarial system, where the parties in the suit bring evidence before the court. Court cases are decided by professional judges with no role for juries.
Israel has a three-tier court system. At the lowest level are magistrate courts, situated in most cities across the country. Above them are district courts, serving as both appellate courts and courts of first instance; they are situated in five of Israel's six districts. The third and highest tier is the Supreme Court, located in Jerusalem; it serves a dual role as the highest court of appeals and the High Court of Justice. In the latter role, the Supreme Court rules as a court of first instance, allowing individuals, both citizens and non-citizens, to petition against the decisions of state authorities. Although Israel supports the goals of the International Criminal Court, it has not ratified the Rome Statute, citing concerns about the ability of the court to remain free from political impartiality.
Our law firm VLO provides legal services for corporate and private clients in Israel. These services include mergers and acquisitions, business and debt restructuring, tax and tax disputes, corporate disputes, investments, bankruptcy, litigation and arbitration.
If you have questions, please us right now.
E-mail: vlolawfirm@gmail.com
