Client updates

On June 29, 2026, the Ministry of Finance and the Capital Market, Insurance and Savings Authority published a draft bill for public comment until July 20, 2026, which, for the first time in Israel, would establish a specific licensing and supervisory framework for stablecoin issuers.

The Israeli Corporations Authority has announced that, in the coming period, it will begin a dedicated review concerning family ties and conflicts of interest in amutot and public benefit companies (PBCs).

An Israeli District Court imposed personal liability, jointly and severally, on the directors of a company for trademark infringement, without lifting the corporate veil. Whenever a tort is committed, including intellectual property infringement, any officer or director who personally committed the tort may be ordered to pay out of his or her own pocket, even without lifting the corporate veil.

For the first time, Israel’s Supreme Court has established a clear test for calculating financial sanctions under the Consumer Protection Law, depending on whether the conduct constitutes a single act or multiple separate acts.

In February 2026, the Haifa District Court’s Appeals Committee ruled that, under particular circumstances, real estate developers’ successful bids in Mehir LeMishtaken tenders and their entry into lease agreements with the Israel Land Authority do not constitute the “purchase of a right in real estate” subject to purchase tax.

On June 12, 2026, Anthropic announced that the US government had ordered it to immediately suspend foreign nationals’ access to its advanced AI models, Fable 5 and Mythos 5, pursuant to an export control directive issued on national security grounds.

Following progress on the Omnibus legislative package, the European Commission has published draft guidelines on the classification of high-risk AI systems. While not legally binding, the draft guidelines provide an early indication of how the Commission is likely to interpret and apply the AI Act’s risk-based framework in practice.

The District Court convicted most of the defendants in the IT cartel case, one of the most substantial criminal proceedings in Israel in recent years in the field of competition law. Alongside the convictions, the court acquitted our client Haim Shohat, and the company Matrix, of one of the charges, after determining that the prohibited understanding required for conviction for a cartel offense had not been proven beyond a reasonable doubt.

Installing a “robot” for algorithmic trading and defining its parameters is not deemed a “technological service” but may constitute investment portfolio management, which requires a license. This is because the service provider retains material discretion (choice of platform, transaction volume, profit and loss targets, and risk management), even when the account and funds are in clients’ names.

The Tel Aviv Regional Labor Court recently ruled[1] on a lawsuit filed by the founder, principal shareholder, and CEO of an Israeli startup that was acquired by companies in the Facebook Group. The court adjudicated two principal issues: 1) Is the founder entitled to future salaries and restricted stock units (RSUs) after his employment by Facebook Israel was terminated? 2) Facebook Israel’s conduct during the founder’s onboarding, employment, and dismissal and, in particular, whether he was given a genuine opportunity to integrate into his role and whether the company conducted a lawful dismissal proceeding.

The Tel Aviv Regional Labor Court issued a new ruling expanding employers’ obligations regarding sexual harassment in the workplace and stated that employers may be obligated to prevent and address incidents of sexual harassment by customers, patients, or other third parties, even when the Prevention of Sexual Harassment Law does not directly apply.

The European Parliament has announced that agreement has been reached on the Digital Omnibus proposal for changes in the EU AI Act. Although still subject to completion of the formal legislative process, these changes represent a significant regulatory development and provide greater clarity as to the direction of EU AI legislation.

An Israeli district court ruled, for the first time, that distributable profits may be recognized even when a company has a balance of accumulated losses, provided that the profits accumulated during the holding period actually contributed to reducing the accumulated loss, even if the company ultimately had no surpluses.

At the end of April 2026, the Israel Securities Authority (ISA) published a new draft directive regulating the activities of licensed investment advisors and marketers when providing one-off services and services in relation to alternative assets. The purpose of the directive is to reduce information asymmetries and mitigate potential conflicts of interest identified during ISA audits that, in some instances, even resulted in enforcement proceedings.

On April 15, 2026, the Israel Medical Association’s Ethics Department published a position paper outlining guidelines for the use of artificial intelligence in the healthcare system. Although the position paper addresses physicians and medical institutions, in practice, it has significant implications for healthtech and medtech companies. Since medical institutions will be required to align their activities with these principles, it is reasonable to assume this will directly impact their demands on technology providers.

In March 2026, the Ministry of Economy and Industry published a draft bill to replace the current dual-use export control orders with comprehensive primary legislation. The proposed law aims to broaden regulatory oversight and establish a more effective, modern framework for controlling exports of civilian, nuclear, biological, and chemical items.

The Israeli Privacy Protection Authority (PPA) has published a position paper clarifying its interpretation of Regulation 2(4) regarding the transfer of personal data abroad. In this context, it emphasizes the requirements applicable to organizations transferring data outside of Israel, including to the United States.

Israel’s Supreme Court is stepping up its efforts to address AI-generated hallucinations, and recently ordered the Ramat Gan Municipality to pay exceptional court expenses of ILS 30,000. This is due to the municipality’s reliance on fictitious case law and a non-existent Ministry of Education Director-General circular, in a way that violated a special education child’s right to transportation to his school.

In light of the declaration of a state of emergency on the home front following Operation Epic Fury, the Registrar of Associations and Endowments clarified that NPOs and public benefit companies (PBCs) may continue operating under the lenient directive dated October 10, 2023. This allows them to carry out activities aimed at providing immediate and essential assistance during the state of emergency, even if such activities do not fully align with their approved objectives.

On March 3, 2026, the Minister of Labor announced his intention to issue an extension order of a collective bargaining agreement to regulate the rights of reservists and their spouses. For convenience, the key provisions of the collective bargaining agreement are set out below. We will update when this extension order is announced.