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Client updates / Corporate
The Companies Registrar has recently increased its enforcement efforts when companies failed to submit annual reports, imposing fines amounting to a few thousand shekels on companies that do not comply with the requirements.
In October 2019, the Israel State Attorney published a new guideline on its office’s policy when considering the prosecution of a corporation, as well as on how it should determine its position on the manner of punishing corporations.
The Israel Securities Authority (ISA) and the Ministry of Justice published a call to the public to adjust the corporate regime, as part of addressing problems that may arise as a result of the transition of public companies to a decentralized ownership structure.
Six months after the amendment to the Economic Competition Law took effect, the Competition Authority published its position regarding the circumstances in which even an entity with less than a 50% market share may be deemed a "monopoly holder."
The Israel Securities Authority has published a position paper summarizing updated information about the processes for listing and delisting dual-listed companies on the Tel Aviv Stock Exchange and additional stock exchanges abroad. The position paper provides information both to dual-listed companies and companies considering dual listing.
On April 12, 2019, Arcturus Therapeutics Ltd., an Israeli public company traded on NASDAQ, published in the United States a prospectus and proxy statement (convening a general meeting of shareholders of the company). Publishing the prospectus is an advanced step toward completing an arrangement between the company and its shareholders.
Chapter 8 of the new Insolvency and Economic Rehabilitation Law addresses the liability of officers and functionaries. The law’s main innovation is that - beyond liabilities toward the corporation, which already existed prior to the enactment of the law, such as fiduciary duty and duty of care - special liability will also be imposed on the corporation’s officers and functionaries.
Two important block exemptions have been updated recently: the exemption for joint ventures and the exemption for restraints ancillary to mergers. The amendments transfer the examination of the intensity of the harm to competition deriving from these arrangements from the Israel Antitrust Authority to the business sector.
Recently, the Israel Tax Authority published a circular discussing business restructuring in multinational groups.
A new circular by the Israel Tax Authority determines the terms for granting options to employees when the vesting of such options is contingent upon performance milestones or the occurrence of an IPO or exit event.
The Delaware Court of Chancery issued a precedent recently, whereby an acquisition agreement may be cancelled due to the occurrence of a “Material Adverse Effect” (MAE) in the acquired entity.
The Ministry of Justice recently published a new memorandum regarding an amendment to the Companies Law. This amendment seeks to authorize the Registrar of Companies to administratively strike off a company from the Companies Register.
Recently, a four month proxy fight over control of an Israeli incorporated NASDAQ traded company was settled, following a series of proceedings held before the Tel Aviv District Court. At a crucial juncture, the Tel Aviv Court was asked to issue a temporary injunction over a transaction initiated by the board, which included a highly dilutive (24.9%) issuance of shares.
The Israeli Supreme Court has set a precedent by ruling that the Business Judgment Rule should also be applied to a company’s board of directors when it is deciding whether or not to file a derivative suit.
On March 23, 2018, the TASE board of directors approved the launch of a new index in conjunction with the Ministry of Economy and Industry.
The Knesset recently approved the Law for the Reduction in the Use of Cash. This law imposes bans and restrictions on the making and receiving of payments using cash and checks at the sums therein prescribed.
The State Comptroller, Judge Joseph Shapira (retired), published an audit report on the financing of political parties in relation to parliamentary parties in the 20th Knesset for the period from April 2015 until year-end 2016.
The Israel Tax Authority published a draft circular today about a sale of rights in a corporation when a portion of the consideration is paid to the seller at a future date.
In a precedent-setting ruling handed down recently in the Tel Aviv District Court a motion to certify an action as a class action, which was filed against Tower Semiconductor Ltd. and its officers, was dismissed in limine based on the rationale that US law applies to the company in relation to the matter of liability, since Tower is also listed for trading in the United States.
The Israeli Law, Information and Technology Authority (ILITA) recently published a new draft directive regarding the handling of customers’ personal information (which is organized as a registered database or as a database under compulsory registration) when it is held by an acquiree company and is being transferred to the acquirer company within the scope of a merger or acquisition transaction.