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Israeli Market Developments

July 2012 - Finance. Legal Developments by Herzog Fox & Neeman .

More articles by this firm.

Welcome to the 4th edition of Unfolding, which looks at some important developments in Israel in recent months.  Much has happened in Israel since the last edition of Unfolding. The Israeli economy may be small in scale, but never in the level of its business activity.

A New Foreign Investment Vehicle in China

Introduction Until recently, a foreign company or individual wishing to invest in China could only do so by setting up a limited liability company1 in one f the following forms: equity joint venture, cooperative joint venture or a wholly foreign owned enterprise (i.e., EJV, CJV and WFOE, collectively "FIEs").

Israeli Financial Markets Updates

  • Pilot Program for the Encouragement of the Establishment of R&D Centers in Israel for the Service of the International Financial Community
On August 16, 2010, a Directive by the Director General’s Office in the Ministry of Industry, Trade & Labor for a pilot program to be administrated by the Ministry’s Office of the Chief Scientist (“OCS”) became effective in order to develop and create a new engine of growth in the financial sector.

Ground Breaking Amendments to Israeli Mutual Funds

On 31st December, 2007, groundbreaking new regulations reforming the mutual funds market came into force. A series of amendments have been made to the Joint Investment Trust Regulations. The purpose of the amendments is to relax the various restrictions applying to mutual funds, and in doing so, to broaden the investment possibilities of mutual funds. One major example is permitting a "special fund" to invest in hedge funds. A further notable change is legislating new regulations regarding the classification of mutual funds for the purpose of publication. These regulation regulate the publication of information relating to units in mutual funds, including redemption price and yield thereof, which aim to improve the quality of information provided to the investing public. The publications will also include classification of the mutual funds into classes and subclasses, ranked in accordance with the type and maximum risk relating thereto. An additional goal of this amendment is to create a better basis for comparing the various available mutual funds.

Selling Foreign Mutual Funds in Israel

The Joint Investment Trust Law, which is also known as the "Mutual Funds Law", regulates the activity of mutual funds in Israel and their offerings to the public. Currently, foreign mutual funds may not be offered directly to Israeli investors. This is due to the difficulty that foreign mutual funds offering their units to Israeli investors would face in complying with all the Israeli regulatory requirements.