Client updates /  Foreign Company

The Supreme Court noted that, by its nature, the essence of a brokerage transaction is joining two parties into one transaction. Therefore, treating the transaction as providing a service to each party separately—a foreign resident and an Israeli resident—does not reflect the true economic essence of the service.

The Israeli Competition Authority believes its authority to issue information requests is not limited to Israeli companies, and that foreign companies with no affiliation to Israel are also subject to its authority and to fines for breach of the Competition Law. 

The Israel Securities Authority’s (ISA) new draft amendment to the general permit to offer foreign brokerage services in Israel proposes to obligate permit holders to supervise the activities of marketers on their behalf. For example, permit holders must carry out due diligence examinations of marketers.

The new ruling has significant implications since the question of service of process also involves the Israeli court’s acquisition of international jurisdiction to adjudicate a proceeding.