WORLD TRADE ORGANIZATION  
ORGANISATION MONDIALE DU COMMERCE  
ORGANIZACIÓN MUNDIAL DEL COMERCIO 
WT/TPR/M/272/Add.1 
19 December 2012 
 (12-6815) 
Trade Policy Review Body 
30 October and 1 November 2012 Original: English/ 
 anglais/  inglés 
 
TRADE POLICY REVIEW 
ISRAEL 
Record of the Meeting 
Addendum 
Chairperson:  H.E. Mr. Eduardo Muñoz Gómez (Colombia)  
 This document contains the advance written questions, and replies provided by Israel.1 
__________________________________________________________________________________  
 
Organe d'examen des politiques commerciales 30 octobre et 1
er novembre 2012 
 
EXAMEN DES POLITIQUES COMMERCIALES 
ISRAËL 
Compte rendu de la réunion 
Addendum 
Président:  S.E. M. Eduardo Muñoz Gómez (Colombie) 
 
 Le présent document contient les questions écrites communiquées à l'avance et les réponses 
fournies par Israël .1 
__________________________________________________________________________________ 
 
Órgano de Examen de la s Políticas Comerciales 
30 de octubre y 1° de noviembre de 2012 
 
EXAMEN DE LAS POLÍTICAS COMERCIALES 
ISRAEL 
Acta de la reunión 
Addendum 
Presidente:  Excmo. Sr. Eduar do Muñoz Gómez (Colombia ) 
 
 En el presente documento figuran las pregunt as presentadas anticipadamente por escrito, junto 
con las respuestas facilitadas por Israel.1 
  
 
    
                                                      
1 In English only./En anglais seulement./En inglés solamente.  
  WT/TPR/M/272/Add.1 
 Page 3 
 
 
REPLIES PROVIDED BY ISRAEL 
UNITED STATES 
Part I:  Secretariat Report, WT/TPR/S/272 III. Trade Policies And Practices By Measure (1) Measures Directly Affecting Imports 
(iv) Import prohibitions and licensing Page 28, Table III.6:  The table provided by the Secretariat notes that Israel maintains import 
prohibitions on imports of certain wine, spirits, and grape juices with a geogra phical name that "may 
give the impression that it incorporates such a geographical name."  
- How does this law affect the use of produc ts such as champagne, or those that are not 
made in the Champagne regions of Fran ce and clearly are labeled as such?  For 
example, in the United States, wines that had their label approved before March 10, 
2006 are allowed to be called, for example "California Champagne." 
Answer: 
Israel has been a member of the Lisbon Agreemen t for the Protection of Appellations of Origin 
since 1966. Pursuant to Israel's commitments under th at treaty signs that conflict with a registered 
appellation of origin will be deemed infringing of such rights, even where labeled in a non-confusing manner, by addition of words such as "style" or "like". Given that "champagne" is a 
registered appellation of origin the use of "Ca lifornia Champagne" on wine products in Israel 
would likely be actionable.  
Page 29, paragraph 24:  The Secretariat indicates that "Israel applies non-automatic licensing 
procedures under the Free Import Order of 2012," a nd that Israel's "last notification on import 
licensing procedures dates from 2006…"  In light of the WTO Agreement on Import Licensing Procedures, when will Israel notify its import lic ensing procedures, including its responses to the 
annual questionnaire on import licensing procedures (under Article 7.3 of the Agreement), and provide copies of its rules and regulations (unde r Article 1.4 of the Agreement) to the WTO 
Secretariat?  
Answer: 
Israel's import licensing procedures and its rul es and regulations were notified to the WTO in 
accordance with Articles 1.4 and 7.3 of the Agreement on Import Licensing in documents 
G/LIC/N/1/ISR/2, G/LIC/N/2/ISR/2, G/LIC/N/3/ISR/2 (dated 19th and 22th of October 2012). 
(v) Contingency trade remedies 
Page 30, paragraph 30 and Table III.7:  The Secretariat report references a December 2011 
amendment to its Trade Levies Law.  When does Israel  anticipate that it will notify this legislation to 
the appropriate WTO committees?  WT/TPR/M/272/Add.1 
Page 4  Answer: 
Israel will be notifying these amendments to the appropriate WTO committees in the near future, 
after translation work is completed. The amendm ents made in 2011 to the Trade Levies Law refer 
to the following: 
 a. Before applying a provisional measure in anti -dumping and safeguard proceedings 
the decision to apply the provisional me asure must be submitted to the Director 
General of the Ministry of Industry, Trade and Labor. The DG's approval will be 
given only after consulting with the Director of the Budget Department of the Ministry of Finance.  
 b. When determining whether to apply a provisional anti -dumping and safeguard 
measure the Commissioner of Trade L evies, in addition to the existing 
considerations detailed in the law, must also weigh the potential injury to other 
sectors in Israel likely to be effected by the decision to impose a provisional anti-dumping and safeguard measure. 
 c. The approval of the Knesset Finance Committee for the imposition of the duties 
included in the law must be given prior to the imposition of the duty instead of 
within 60 days following its imposition.  
Page 30, paragraph 30:  The Secretariat notes that  Israel's legislation governing antidumping and 
countervailing duties envisions the adoption of im plementing provisions on a number of technical 
details.  Israel reported to the WTO that such prov isions were being prepared in 2006, but that none 
have yet been approved.  Can Israel please provide an update on the status and likely content of these 
provisions? 
Answer: 
Israel's experience thus far in implementing the provisions of the Trade Levies Law has shown that 
there is no need at this point to promulgate im plementing provisions and therefore none have been 
prepared. 
(vi) Standards, technical regulat ions, and conformity assessment 
Page 34, paragraph 41:  As highlighted in the Secr etariat report, in January 2012, the Government of 
Israel announced the plans to make the remainder of  Israel's mandatory stan dards international, as 
opposed to local standards.  Please provide an update on the status of the implementation of its decision to expand the recognition of internationa l standards for imported products.  When does the 
Government of Israel expect that  the new standards will take effect ?  What categories of products will 
the new standards affect? 
Answer: 
Following the government decision concerning int ernational trade conditions, the current status of 
the adoption of international standards is as follows: 
Electricity and electronics completed in 2011 
Building materials  to be completed by end of 2012 
Foodstuffs   expected to be completed by end of 2014 
It should be noted that by the end of 2011 80% all non-food mandatory standards have been 
transformed by the adoption of international or regional standards.  WT/TPR/M/272/Add.1 
 Page 5 
 
 
(2) Measures Directly Affecting Exports 
(v) Export finance, insurance and assistance  
Page 39, paragraphs 63-64:  During the review peri od, the Government of Israel introduced two new 
export credit guarantee programs run by the Ministry of Finance.  The Secretariat report states that "the Government has substantially increased its ex posure to credit guarantees in order to stimulate 
exports."  These programs do not appear to have b een included in Israel's most recent subsidies 
notification, G/SCM/N/220/ISR (11 November 2011). 
 - When does Israel intend to notify these programs?  
Answer: 
Israel will consider notifying these programs in the framework of its next "New and Full 
Notification", pursuant to Article XVI:1 of th e GATT 1994 and Article XXV of the Agreement on 
Subsidies and Countervailing Measures. Israel intend s to submit this notification during 2013. 
 - Please confirm whether the premium rates charged by these programs are adequate to 
cover the long-term operating costs and losses of the programs. 
Answer: 
In the short term programme the premiums  cover long-term op erating cost and losses .  In the 
medium and long term program, due  to low demand, only one transaction was insured. 
This transaction is in default so the  premiums do not cover the losses . 
(3) Measures Affecting Production and Trade (v) Trade-related aspects of intellectual property rights (TRIPS) 
Page 50, paragraph 107:  The Secretariat report st ates that the Government of Israel has not yet 
ratified or fully implemented the World Intellectual Property (WIPO) Copyright Treaty (WCT) or 
WIPO Performances and Phonograms Treaty (WPPT).  When does the Government of Israel intend to 
ratify and fully implement these treaties?   
Answer: 
The TRIPS Agreement pre-dates both the WCT an d the WPPT and does not require conformance 
with either. In Israel no formal decision has ever been taken as to whether to ratify these treaties. 
Except for the provisions relating to "technologi cal protection measures" (TPM), current Israel 
copyright law conforms to the substantive require ment of these treaties. In September 2012 the 
Government of Israel published an Exposure Bill seeking public comment for a possible Bill that would create TPM legislation. Whether that Expos ure Bill will coalesce into a Government Bill will 
be determined after review of comments received and further internal discussions.  
Page 51, Table III.13:  The table provided by the S ecretariat listing the number of patent applications 
filed and granted appears to demonstrate that the rate  of patent grants compared to filings is low.  
What is the Patent Office's allowance or grant rate ?  To what does Israel attribute the low allowance 
rate for patents? WT/TPR/M/272/Add.1 
Page 6  Answer: 
No official "grant rate" statistics are maintained. While some statistics are published in the Israel 
Patent Office Annual Reports2, those statistics merely set forth numbers of patents applied for in a 
given year, accepted in a given year and granted in  a given year. However, there is no correlation 
between the applications filed in a given year and the patents granted or accepted in a given year. 
Indeed, most if not all of the granted patents would have appeared as "applications filed" several 
years earlier. Nevertheless, the "patents grante d" statistics for 2011 do show an overall increase in 
absolute numbers of patents granted in 2011 (5,104) up from 2,294 in 2010.  
Page 55, paragraph 128:  The Secretariat report indicates that under Israel's work-for-hire doctrine, 
rights in a commissioned work belong to the au thor "unless otherwise agreed, excluding private 
portraits or photographs of a private event (for instance a family celebration) where by default the 
property of the work belongs to the commissioner of the work."  Please explain why this exclusion 
applies to this specific category of works.  If th e photographer at a wedding, for example, drafted a 
contract between himself and the person who commissioned the photographs stating that the 
photographer would retain the rights in the photographs , would that contract be prohibited, or void, 
under Israeli law?   
Answer: 
The statute (Section 35) creates only a default arra ngement for determination of first ownership of 
copyright in a commissioned work in the absence of  a contract to the contrary. First ownership 
(and subsequent ownership) of cop yright in a work may be freely assi gned, in whole or in part, by 
contract. Hence, first ownership of a work, including a portrait or family photograph can be with either the commissioner of a work or the make r (e.g. photographer) of a work. The exception 
referred to for portraits and photographs was carri ed over from the prior statute (Copyright Law 
of 1911) in order to maintain continuity with prior law.  
Page 56, paragraph 133:  The Secretariat report pr ovides information on the authority of Customs to 
detain merchandise suspected of trade mark or c opyright violations and provides information on the 
number and types of goods seized.  Can Israel pr ovide any additional information relating to the 
number of criminal prosecutions for intellectual property theft and sentences given? 
Answer: 
In the years 2011-2012 Israel Customs filed 10 charge sheets.  In three of the cases the 
punishments were suspended sentences ranging from  10 to 12 months and fines ranging from 
about $2,000 to $13,000.   In three cases the defendants received 3 to 6 months public service plus 
suspended sentences the longest of which was 11 mont hs and small fines, the largest of which was 
about $3,900.  In two of the cases, the defendants received imprisonment and fines.  In one of the 
cases it was 8 months imprisonment, 10 months su spended sentence and a fine of about $25,000.  
In the second case, the punishment was 5 years imprisonment, 2 years suspended sentence and a 
fine of about $11,000.  The ot her cases are still pending. 
Additionally, is information available regarding civil litigation of intellectual property infringement 
cases and outcomes? 
Answer: 
In the year 2011, there were 73 civil suits filed by th e rights holders.  Although we do not have 
statistics as to the outcome of the cases, from our experience we can say that the goods are usually 
                                                      
 2  http://old.justice.gov.il/MOJEng/RashamHaptentim/AnnualReport.htm 
  WT/TPR/M/272/Add.1 
 Page 7 
 
 
destroyed.  In addition, it should be pointed out that in 188 cases the rights holder and the importer 
reached agreements before the filing of the civil case. Except for a few instances where the right 
holder agreed to the removal of the offend ing trade mark, the goods were destroyed. 
Page 56, paragraph 131:  The Secretariat report states that the maximum statutory damages for 
copyright infringement is NIS 100,000.   
 - Are there any statistics available that compile the results of cases where statutory 
damages have been awarded?   
Answer: 
No statistics are maintained regarding results of cases where statutory damages have been awarded. 
Nevertheless most, if not all, copyright decisions are publicly available either on court system web 
sites and/or through commercial publishers.  
 - How does Israel ensure that this maximu m is "adequate to compensate for the injury 
the right holder has suffered" in all cases of copyright infringement?   
Answer: 
Copyright owners can elect either statutory dam ages (compensation without actual damages) or 
actual damages. In either case the damage award is aimed at giving compensation commensurate 
with the damage incurred by the infringement.  
 - Does Israel plan on amending the Copyright Act of 2007 (2011) to provide for a 
minimum level of statutory damages?   
Answer: 
There is no plan to create a minimum for statutor y damages. Under the prior copyright statute (in 
force until 2007) a minimum level was in place, however it was not carried over into the 2007 law 
primarily due to abuses and calls from the courts to  repeal it in favor of a system that provides for 
greater judicial discretion. Consequently the legi slator enacted a system that increased the maximal 
ceiling from the former 20,000 NIS (US$5,000) to  a higher ceiling of up to 100,000 shekels 
(approximately US$25,000) per work infringed. 
 - Are these statutory damages available on a per-copy basis, or on a per-work basis? 
Answer: 
Per work. 
IV. Trade Policies By Sector (1) Agriculture (iv) Border measures 
Page 61, paragraph 25:  The Secretariat report st ate that "the remaining WTO tariff quotas and the 
preferential tariff quotas are implemented throu gh licensing procedures as provided for under the 
Customs Tariff and Exemptions and Tax Order of 2006."  WT/TPR/M/272/Add.1 
Page 8  
- How does Israel ensure that licenses for quotas are delivered without administrative 
delays? 
 How does Israel ensure that information on  fill rates is available publically at all 
times? 
Answer: 
In October of each year TRQs available for allocation in the subseq uent year under Israel's 
international agreements are published online,  including yearly quantities and criteria for 
submission and allocation. In the case of fresh pr oduce TRQs allocated by the MARD, fill rates are 
published and updated on a monthly basis. 
MOITAL reallocates unused quantities at the beginn ing of August of each year with licenses valid 
until the end of the year. 
Licenses allocated by MARD are valid for 3 mo nths, and unused quantities are reallocated every 
3 months. 
Method of allocations are determined according to demand and the size of the quota. Both 
ministries ensure economically viable size of alloca ted quotas and allow opportunities for first time 
importers. 
(3) Manufacturing 
(i) Industrial Policy Developments 
Page 66, paragraph 46:  The Secretariat's report states that tax incentives and grants available under 
the Law on Encouragement of Capital Investment "remain conditional on expor t performance (25% of 
sales must be exported)."  How does Israel view such a requirement in light of Article 3 of the 
Agreement on Subsidies and Countervailing Measures? 
Answer: 
The requirements under the Law on Encouragement of  Capital Investment are intended to ensure 
that incentives are available  to companies that contribute to the financial independence of the 
Israeli economy and are competitive contributors to th e gross national product. Israel is of the view 
these incentives are in accordance with th e requirements Agreement on Subsidies and 
Countervailing Measures.  The government, as any oth er investor, is interested in minimizing risks 
when investing; therefore the project must be economically viable and has a potentially significant market.  
Part II:  Government Report, WT/TPR/G/272 
Page 21, paragraph 64(3):  The Gove rnment of Israel indicated that it drafted a bill, on "Exposing the 
Identity of Up Loaders in Electronic Communication Ne twork," that will enable "the discovery of the 
identities of up loaders of allegedly infringing materi al."  Please provide an updat e on the status of this 
draft bill and further describe the provisions  likely to be covered by the bill.   
Answer: 
A Government Bill for the "Exposing the Identity of Uploaders in an Electronic Communications 
Network" has passed its first Reading and is no w under public discussion in Knesset Committee in 
preparation for its second and third readings.  The Bill proposes procedural mechanisms to 
authorize courts to order Internet Service Pr oviders to disclose any information they may have  WT/TPR/M/272/Add.1 
 Page 9 
 
 
regarding the identity of a particular uploader, including, in appropriate cases obtaining such 
information ex parte together with ex parte "Anton  Pillar" (search and seizure of evidence) Orders. 
Page 21, Paragraph 65:  The Government of Israel  indicated that Amendmen t no. 5 to the Trademark 
Ordinance was enacted in September 2010, and a new law replacing the Industrial Design Ordinance 
was expected to be published in September 2012.   Are the new Industrial Design law and the 
Trademark Ordinance amendment available publically for review? 
Answer: 
Trademark Amendment no. 5 (Madrid Protocol) was enacted in 2003 and the Madrid Protocol 
became operational in Israel several years ago.  The amendment of the trademark law was 
published and is available.  
The Exposure Bill for a new Industrial Designs Law was not published in September due to a need 
for minor adjustments in the proposed text. It is expected to be published soon. 
Part III.  Other Questions Government Procurement 
There have been public discussions of various type s of "tied aid" financing packages - including a 
signed MOU with the Government of China regarding large infrastructure projects - being used by the 
GOI in the award of major government infrastructure projects – like the Eilat-Ashdod railroad line.  Please explain how the Government of Israel will ensure that the process for awarding these projects will be fully competitive and consistent with  Israel's international trade obligations? 
Answer:
 
The Government of Israel is still considering the various options for implementing the Eilat high 
speed railway project. Regarding the MOU signed with China, it should be noted that it is broad 
transport cooperation MOU. Similar general MOUs have been signed with other countries. We 
would welcome discussions with the United States on entering into a similar type of arrangement. 
Trade Marks Ordinance and law 
The Secretariat report indicated that Israel is "a  party to most major international treaties on 
intellectual property rights…," including the TRI PS Agreement (page 50, paragraph 107).  We 
therefore request additional information regarding Isr ael's Trade Marks Ordinance and law, in light of 
Article 16(1) of the TRIPS Agreement re garding protection from all third parties  using in the course 
of trade identical or similar signs for goods or services which are identical or similar  to those in 
respect of which the trademark is registered.   
Answer: 
Israeli case law has long found a presumption of infringement where a third party's mark is 
identical with, or very similar to, a registered ma rk and used in respect of goods or services for 
which the mark is registered. See for example, Civil Appeal 3559/02 (Supreme Court) Toto v. 
Hamoatza reported in Supreme Court Reports, Vol.  59, page 873 at page 892; Picant Ta'asyot 
Mazon v. Osem, Supreme Court Civil Appeal 1400/97 (April 29, 1997). 
Article 11(9) of Israel's Trade Marks Ordinance st ates that "The following marks are not eligible for 
registration: a mark identical with one belonging to  a different proprietor which is already on the 
register with respect of the same goods or description of goods , or so nearly resembling such a WT/TPR/M/272/Add.1 
Page 10  
mark as to be calculated to deceive."  Please cl arify the meaning of "same… description of goods."  
Please also clarify whether Israel will refuse registrati on of a sign that is identical or similar to an 
earlier-filed trademark, but contains similar and not identical goods or services. 
Answer: 
The statute uses the phrase "goods (or services) of the same trade description", a phrase which is 
derived from former United Kingdom trademark statut ory law. In practice "goods of the same trade 
description" means "similar goods or services" and findings tend to be made on a case by case 
manner. 
Where a sign is identical or similar to an earlier registered trademark, but is registered in respect of 
similar but non-identical goods or services, the junior mark will be refused registration if it is likely 
to create confusion with senior registered mark.  
Article 1 of Israel's Trade Marks Ordinance stat es, "'Infringement' means the use by a person not 
entitled thereto of a registered trade mark, or of a mark resembling such a trade mark, in relation to 
goods in respect of which the trade mark is registered, or to goods of the same description ;..."  
Please explain the meaning of the wording "goods  of the same description."  Also, please clarify 
whether Israel's definition of infringement encomp asses the use by a person not entitled thereto of a 
registered trade mark, in relation to goods or services  that are similar to the prior registrant's goods or 
services, but that are classified in a different international class.   
Answer: 
The phrase "goods of the same trade descrip tion" has the same meaning with respect to 
registration and infringement matters.  
The phrase "goods of the same trade descriptio n" is not coterminous with international 
classifications. Consequently, infringement may be found in instances where the respective marks 
are confusingly similar or identical with respect to similar goods or services, despite where such 
goods or services may not be included in the sa me international classification categories. 
UNITED STATES – SET 2 
Question 5:  Page 34, paragraph 41:  As highlighted  in the Secretariat report, in January 2012, the 
Government of Israel announced the plans to make  the remainder of Israel's mandatory standards 
international, as opposed to local standards.  Please provide an update on the status of the 
implementation of its decision to expand the rec ognition of international standards for imported 
products.  When does the Government of Israel expect  that the new standards will take effect?  What 
categories of products will the new standards affect?   
Answer: 
Following the government decision concerning int ernational trade conditions, the current status of 
the adoption of international standards is as follows: 
Electricity and electronics completed in 2011 
Building materials  to be completed by end of 2012 Foodstuffs   expected to be completed by end of 2014 
U.S. Follow up Question:  First, on standards. In the Secretariat report, Israel had indicated its plans to 
make Israel's mandatory standards "international."  However, in its response to the question we put 
forward in writing, Israel indicated that by the end of 2011, non-food mandatory standards have been 
transformed by the adoption of international or re gional standards.  Please clarify this difference.  WT/TPR/M/272/Add.1 
 Page 11 
 
 
Since the TBT Agreement encourages the adoption of international standards, we wonder what 
regional standards are being adopted ? And, is there a reason why regi onal standards would be adopted 
as opposed to international?  Additionally, we urge Israel, per its WTO TBT obligations, to notify any 
changes to mandatory standards, allow other WTO Members the opportunity to comment, and to take 
those comments into account. 
Answer: 
The term "regional" in Israel refers to U.S.  and European standards while "international 
standards are those standards developed by ISO and IEC. 
American standards which have been adopted include ASME, ASTM, NFTA, NSF etc. which we 
consider broader than "national ". 
Israel regularly provides notifications of changes in its mandatory standards, as required by the 
WTO-TBT Agreement.  
The notifications allow for a 60 day period for comme nts by WTO members.  Often, when requested 
by a TBT member we agree to extend that period, for an additional period of one to two months.   
Often the US comments have been taken into account  and changes requested by the U.S. have been 
introduced to the standard or the regulation under consideration.   
(3) Measures Affecting Production And Trade (v) Trade-related aspects of intellectual property rights (TRIPS) 
Question 7:  Page 50, paragraph 107: The Secretaria t report states that the Government of Israel has 
not yet ratified or fully implemented the World In tellectual Property (WIPO) Copyright Treaty (WCT) 
or WIPO Performances and Phonograms Treaty (WPPT).  When does the Government of Israel intend 
to ratify and fully implement these treaties?   
Answer: 
The TRIPS Agreement pre-dates both the WCT an d the WPPT and does not require conformance 
with either. In Israel no formal decision has ever been taken as to whether to ratify these treaties. 
Except for the provisions relating to "technologi cal protection measures" (TPM), current Israel 
copyright law conforms to the substantive require ment of these treaties. In September 2012 the 
Government of Israel published an Exposure Bill seeking public comment for a possible Bill that would create TPM legislation. Whether that Expos ure Bill will coalesce into a Government Bill will 
be determined after review of comments received and further internal discussions.  
U.S. Follow-Up Question:  Second, pertaining to Is rael's response that in September the Government 
published an Exposure Bill seeking public comment  for a possible Bill that would create TPM 
legislation, the United States appreciates Israel's response and its commitment to an inclusive and 
thoughtful process as this legislation develops. We also share the concerns many stakeholders have 
expressed about the adequacy and e ffectiveness of the current draft. 
Answer: 
We note the U.S. comment. 
Question 10:  Page 56, paragraph 133:  The Secretar iat report provides information on the authority of 
Customs to detain merchandise suspected of trad e mark or copyright violations and provides WT/TPR/M/272/Add.1 
Page 12  
information on the number and types of goods seized .  Can Israel provide an y additional information 
relating to the number of criminal prosecutions for intellectual property theft and sentences given? 
Answer: 
In the years 2011-2012 Israel Customs filed 10 charge sheets.  In three of the cases the 
punishments were suspended sentences ranging from  10 to 12 months and fines ranging from 
about $2,000 to $13,000.  In three cases the defendan ts received 3 to 6 months  public service plus 
suspended sentences the longest of which was 11 mont hs and small fines, the largest of which was 
about $3,900.  In two of the cases, the defendants received imprisonment and fines.  In one of the cases it was 8 months imprisonment, 10 months suspended sentence and a fine of about $25,000.  In the second case, the punishment was 5 years imprisonment, 2 years suspended sentence and a 
fine of about $11000.  The other cases are still pending. 
Additionally, is information available regarding civil litigation of intellectual property infringement 
cases and outcomes? 
Answer:
 
In the year 2011, there were 73 civil suits filed by th e rights holders.  Although we do not have 
statistics as to the outcome of the cases, from our experience we can say that the goods are usually 
destroyed.  In addition, it should be pointed out that in 188 cases the rights holder and the importer 
reached agreements before the filing of the civil case. Except for a few instances where the right 
holder agreed to the removal of the offend ing trade mark, the goods were destroyed. 
U.S. Follow up Question: Third, we appreciate the information provided by Israel on criminal charges 
filed in 2011-2012 by Israel Customs. Israel also provides information about 73 civil suits filed by 
right holders (and 188 cases that settled).  We would appreciate if Israel could please confirm whether 
criminal prosecution for intellectual property theft is available via any avenue other than a charge by 
Israel Customs?  If so, can Israel provide any add itional information relating to how such prosecutions 
may be brought, and the outcome of such prosecuti ons?  Please also clarify whether the 73 civil suits 
brought by right holders were brought only against importers of infringing goods?  If so, can Israel 
provide additional information about other civil litig ation of intellectual property infringement cases, 
including how many of each copyright, trademar k and patent infringement  lawsuits have been 
brought? 
Answer: 
The 73 cases mentioned in our report were filed only against importers in accordance with the 
TRIPS procedures.  
Criminal prosecutions for offences against intellect ual property laws are also filed by the State 
Attorney's Office where the infringing goods are found inside Is rael.  In addition, the rights holders 
may file suit, not only against importers, but against any person who violates their rights within the territory of Israel.   WT/TPR/M/272/Add.1 
 Page 13 
 
 
IV. Trade Policies By Sector 
(1) Agriculture (iv) Border measures 
Question 12:  Page 61, paragraph 25:  The Secretar iat report state that "the remaining WTO tariff 
quotas and the preferential tariff quotas are implemen ted through licensing procedures as provided for 
under the Customs Tariff and Exemptions and Tax Order of 2006."  
- How does Israel ensure that licenses for quotas are delivered without administrative 
delays? 
- How does Israel ensure that information on fill rates is available publically at all 
times? 
Answer: 
In October of each year TRQs available for allocation in the subseq uent year under Israel's 
international agreements are published online,  including yearly quantities and criteria for 
submission and allocation. In the case of fresh pr oduce TRQs allocated by the MARD, fill rates are 
published and updated on a monthly basis. 
MOITAL reallocates unused quantities at the beginn ing of August of each year with licenses valid 
until the end of the year. 
Licenses allocated by MARD are valid for 3 mo nths, and unused quantities are reallocated every 
3 months. 
Method of allocation is determined according to de mand and the size of the quota. Both ministries 
ensure economically viable size of allocated quotas  and allow opportunities for first time importers. 
U.S. Follow up question:  Fourth, Israel notes in its answer to our question regarding the TRQ 
allocation, that "in the case of fresh produce TRQs allocated by th e MARD, fill rates are published 
and updated on a monthly basis."  Please provide in formation on where these fill rates are published 
and updated, including a website if possible. 
Answer:  
The fill rates are published in the MARD website: 
http://www.moag.gov.il/NR/exeres/D 1456646-76F2-42B3-9664- 019BE1ED330E.htm  
The last update is for November 4th 
Part II:  Government Report, WT/TPR/G/272 
Question 14:  Page 21, paragraph 64(3):  The Governme nt of Israel indicated that it drafted a bill, on 
"Exposing the Identity of Up Loaders in Electroni c Communication Network," that will enable "the 
discovery of the identities of up loaders of allegedly infringing material."  Please provide an update on 
the status of this draft bill and further describe th e provisions likely to be covered by the bill.   
Answer: 
A Government Bill for the "Exposing the Identity of Uploaders in an Electronic Communications 
Network" has passed its first Reading and is no w under public discussion in Knesset Committee in WT/TPR/M/272/Add.1 
Page 14  preparation for its second and third readings.  The Bill proposes procedural mechanisms to 
authorize courts to order Internet Service Pr oviders to disclose any information they may have 
regarding the identity of a particular uploader, including, in appropriate cases obtaining such 
information ex parte together with ex parte "Anton  Pillar" (search and seizure of evidence) Orders. 
U.S. Follow up Question:  Our final follow-up question pertains to the Bill on "Exposing the Identity 
of Uploaders in an Electronic Communications Netw ork." Israel indicates that the Bill has passed and 
is under public discussion.  Please provide more deta ils about the procedural mechanisms through 
which courts will be able "to order Internet Serv ice Providers to disclose any information they may 
have regarding the identity of a pa rticular uploader," including what parties may seek such an order, 
the relevant standard for issuing such and order, and what qualifies as an "appropriate case" in which 
the information can be obtained "ex parte together w ith ex parte 'Anton Pillar' (search and seizure of 
evidence) Orders?" 
Answer: 
The proposed bill will give courts  the authority to order internet service providers, and or other 
intermediaries (hereinafter collectiv ely intermediaries), to disclose id entifying information in their 
possession or control which is sufficient to en able service of process (hereinafter Identifying 
Information) upon an anonymous publisher (up-loader) of material that allegedly infringes 
intellectual property rights or is actionable in to rt (such as libel). The bill proposes the following 
procedures: 
Step 1 – Where an entity believes that its intellect ual property rights have been violated through 
posting of material on the internet, or that such material is actionable in tort, such entity may motion the court for an Order requiring an int ermediary to forward to the court Identifying 
Information sufficient to enable service of pro cess upon the heretofore anonymous up-loader. The 
applicant's application must state allegations sufficien t on which to set forth a legal cause of action.  
In addition, the applicant may simultaneously make a parallel application, pursuant to Civil Procedure Law for an ex parte search and seizure  order of the up-loader's property in order to 
obtain and preserve evidence of an infringement or tort. [Current law provides for such search and 
seizure orders, however following enactment of the B ill minor adjustments will be made in the Civil 
Procedure Law to coordinate it with the Bill in the form in which it will be after enactment.] 
Step 2 – If the Court is persuaded that a possible cause of action has been made out in the 
application for discovery of Identif ying Information, and that th e application is not abusive or 
being made for unrelated purposes, then the Co urt may Order the relevant  intermediary to deliver 
to the Court such Identifying Information alon g with information in its possession and control 
about third parties who may also have such Identifying Information. 
Step 3 – Upon the Court's receipt of the aforesaid  Identifying Information the Court will forward 
the applicant's application to the alleged up-l oader for his response. Upon receipt of the 
notification from the Court the alleged up-loader may:  (1) Agree to the disclosure of his identity, in 
which case Identifying Information will be transmitte d by the Court to the applicant; or, (2) Where 
the up-loader fails to respond to the Court's notific ation, the Court will render a decision on the 
basis of documents submitted to it for consid eration; or, (3) The up-loader may elect to 
anonymously contest the application for Identifyi ng Information, however where the Court will be 
persuaded on the basis of prima facie evidence that  there is substantial likelihood for success on the 
merits, the Court will grant the application and de liver the Identifying Information to the applicant.    WT/TPR/M/272/Add.1 
 Page 15 
 
 
AUSTRALIA 
I. ECONOMIC ENVIRONMENT 
Outlook 
Unilateral Trade Liberalisation in Israel, p. 13 
Australia welcomes this opportunity to receive update d advice about Israel's continued commitment to 
economic reform to further enhance its open economy based on free trade.  
Australia understands that Israel has undertaken some  reforms to its agriculture sector in order to 
enhance its food security through great integration with the global market.  
Nonetheless, it remains the case that Israel continu es to maintain a significant degree of policy space 
in its agricultural sector. One indicator of this is  the significant gap between applied MFN tariffs for 
agriculture (which average 73.3%) and applied agricultural tariffs (w hich average 24.5%).  We note 
too that maximum bound tariffs on agriculture exceed 500%.  How does Israel intend to address this gap, including as part of efforts to increase food security and the competitiv eness of its agricultural 
sector? 
Answer: 
As correctly noted by Australia the applied tariffs of different agricultural products are significantly 
lower than the bound ones. This reflect Israel's  responsible and balanced policy allowing the 
importation of food products at lower tariffs than  the bound rates whenever necessary taking, into 
account Israel's sensitivities and concerns. 
Israel thus respects its scheduled commitments, wh ile affording substantia l market access for its 
trading partners in its agriculture market. 
Similar to other members, Israel places food securi ty considerations high on its overall priorities, 
but generally not on the expense of imports. F ood security concerns arise mainly form Israel's 
geographical location and Israel being far from world markets.  
Several reforms have been carried out in Israel du ring recent years, particularly in the area of 
animal production. These reforms increased comp etitiveness and efficiency in the agriculture 
sector which is already highly productive in global  terms. Moreover, the level of overall support in 
agriculture, according to the OECD, has decreased gradually and the cost of support in the overall 
economy has been reduced. As a result, the level of  the PSE and the TSE are lower than the OECD 
average.   
Therefore, tariffs remain the main policy tool in  a country that hardly provides any direct support 
to its farmers who are produc ing under harsh conditions.  
Applied tariffs, with some level of flexibility, w ill remain in place as appropriate, to provide the 
necessary support and protection and as long as the current geopolitical and the food security 
situations continue to exist. 
As net food importer, with very low or zero tariffs  on imported commodities, Israel provides ample 
opportunities for market access. Israel will partic ipate in the agriculture negotiations under the 
Doha round mandate, and will assess the scope fo r lowering bound tarrifs, in the context of a 
balanced package. WT/TPR/M/272/Add.1 
Page 16  II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
Preferential Trade Agreements and Arrangements, p. 16  
Israel's network of FTAs includes some of its main trading partners (EU, United States, EFTA, 
Turkey, Canada, and Mexico), a lthough none currently covers services provisions.  Israel is 
considering expanding the scope of  its FTAs with Canada and the United States to include services.  
Since its last TPR, Israel has concluded a free-tr ade Agreement with MERCOSUR, which has entered 
into force for all signatories.  Israel and the EU have further liberalized their bilateral trade in 
agricultural products through a new Protocol that  entered into force on 1 January 2010.  FTA 
negotiations were launched with India in May 20 10, and with Colombia in March 2012, both are 
intended to cover services.  Feasibility studies have been conducted with the Republic of Korea, and 
with Chile. 
Australia notes that the services sect or is the leading economic activity in Israel.  We also note that 
none of Israel's FTAs currently includes services pr ovisions, although Israel is considering expanding 
the scope of its FTAs with Canada and the United States to include services.  Further, FTAs with India 
and Colombia are intended to cover services. 
Could Israel please explain why historically it chose not to pursue services outcomes in its FTAs, 
notwithstanding the importance of services to its econom y?  Does Israel intend to cover services in all 
its future FTAs? 
Answer: 
All but one of Israel's FTA's were concluded before or soon after the GATS came into force. Israel 
saw no reason to add a bilateral element at the time. 
The MERCOSUR Agreement does not currently incl ude services. It may in the future. When the 
Agreement was negotiated the parties were involved in the DDA services negotiations and wanted to 
give priority to the multilateral negotiations. 
At this point in time, Israel has not made a decisi on on whether to include services in its future 
FTAs. Including services would depend on the jo int decision of the parties to the proposed 
Agreement. 
III. Trade Policies And Practices By Measure 
Measures directly affecting imports Import prohibitions and licensing, p. 29 
Where its tariff quotas are operational can Israel confirm that its arrangements conform to the 
requirements of the Import Licensing Agreement?  Ca n Israel provide up to date data on tariff quota 
fill rates?  What scope is there to reform th e TRQ regime and import licensing arrangements for 
TRQs? 
Answer: 
Israel considers that its TRQ allocation pro cedures (implementing its agricultural TRQ 
commitments) are in conformity with the requi rements of the Import Licensing Agreement. In 
particular, Israel's TRQ procedures are in line with  the requirements of Article I, paragraphs (3), 
(4), (5), (6), (7) and (8). In addition the pro cedures conform to the requirements of Article 3, 
regarding non-automatic licensing, where applicable.  WT/TPR/M/272/Add.1 
 Page 17 
 
 
TRQ fill rates are included in Isra el's MA:2 notification for 2010 and 2011, which is about to be 
circulated in the coming days. Fill rates are traditionally high, (in some cases products are 
imported out of quota) with very few exceptions where demand for licenses is generally low. 
IV. Trade Policies And Practices By Measure 
Measures directly affecting exports 
Export prohibitions, p. 38 As a net food importing country, we note Israel's long held concerns with  the imposition of export 
bans and taxes.  However, we note that Israel 's maintains export licensing and approval schemes for 
agricultural products.  Can Israel provide further details and assurances that  these licensing schemes 
do not restrict trade? 
Answer: 
Export licensing procedures covers poultry, certain propagating materials, fruits and vegetables.  
Licenses are granted to all applicants. Those pro cedures are in place to ensure compliance with 
international standards quality. Therefore, the sc heme does not have an effect of restricting 
exports. 
Agrexco, Israel's leading SOE exporter of fresh produce until recently, has gone through 
fundamental structural changes. Today, more than 100 exporters and exporting companies are operating in the field of fresh fruits and vegetables, flowers and other fresh agricultural products.  
Export subsidies, p. 38 
What was the specific trigger for Is rael to authorize export subsidies for certain fruit and vegetables 
during the 2007/08 and 2008/09 marketing years?  
What is the legislative and regulatory frame work that authorized these measures?   
Can Israel provide further advice on its curre nt policy on agricultural export subsidies? 
Answer: 
Export subsidies were rarely allocated to producers and exporters of fresh produce in previous 
years. 
On the occasion that this measure was availabl e, export subsidies were very limited in scope and 
scale, focusing on the exportation of perishable fr uits of high quality. However, the amount of 
subsidies provided was always fa r below the commitment level. 
Currently, there are no export subsidies programs in place.  Very limited resources are now provided only to market promotion activities in new or existing 
markets.   
Israel agrees to abolish its export subsidies progr am depending on the outcome of the multilateral 
negotiations. WT/TPR/M/272/Add.1 
Page 18  V. Trade Policies By Sector 
Agriculture, p. 57 
Australia notes that about two-thirds of imports of agricultural products enter Israel duty free, mainly 
under preferential Agreements. This suggests str ong trade diversionary impacts.  Has Israel 
undertaken any analysis of these impact from a broad food policy perspective?  
Answer: 
No such analysis, focused on agriculture was performe d. It is noted that  the applied MFN rate for 
commodities such as wheat, fodder grains, sugar , rice etc, are either zero or below 10%.  
Israel, therefore, considers that wh ile FTAs provide exporters with real and preferential access to 
the Israeli market, they do not have the effect of pushing competitive exporters out of the market. 
The diversification of food sources and the numer ous FTAs guarantee steady supply of food. This 
along with lower MFN tariffs in most agricultural products guarantees freer trade without 
undermining Israel's sensitivities and concerns. For example, although there is no FTA between 
Israel and Australia, imports of frozen lamb repre sent 56% of the total import of lamb to Israel. 
Moreover, imports of frozen lamb  from Australia increased from 1,000 tonnes in 2008 to nearly 
4,000 tonnes in 2011. 
Evaluation of support and protection, p. 62  Australia welcomes the reduction in Israel's PSE to 12%  in 2008-10. What plans does Israel have to 
address the fact that a very significant share of  its PSE is potentially most trade distorting? 
Answer: 
Israel's PSE is lower than that of the average of  OECD countries. Tariffs are the main policy tool 
used by the government to support its agricultu ral sector due to budgetary constraints.  
As correctly noted by Australia in its first questio n, applied tariffs are lower than bound ones. This 
represents a responsible and balanced trade policy.  Moreover, in some cases tariffs are reduced 
unilaterally, lowering Israel's trade distorting meas ures as a result. We note that discussions are 
being held amongst various government departments  to examine the possibility of shifting away 
from these measures to direct support and less trade distorting measures. 
Services 
Telecommunications and postal services, p. 73 
The Government has introduced further reforms in the telecommunications market to stimulate price 
competition and innovation among opera tors.  Reforms include a subs tantial reduction of mandatory 
interconnection fees;  improved por tability; an incentives-based regul atory regime to encourage the 
establishment of wholesale markets for fixed-line and mobile telephone services (mandated access to 
fixed networks, mobile virtual ne twork operators), and promotion of  infrastructure-based competition 
by granting two additional UMTS network licences.  The establishment of an independent regulatory 
authority for telecommunications is still under consideration by the Government.  
Telecommunications and postal services, p. 73 
The institutional framework for te lecoms remains unchanged.  The Ministry of Communications is 
responsible, inter alia, for telecommunications polic y, regulation, and supervision of the incumbent  WT/TPR/M/272/Add.1 
 Page 19 
 
 
(Bezeq).  Israel still has no independent  regulatory authority for telecoms.FN  The Israel Antitrust 
Authority is responsible for enforcing co mpetition in the sector (Chapter III(3)(ii)). 
Footnote:  Draft legislation to establish a communi cations authority was s ubmitted in 2004 but the 
process has been suspended.  
Australia notes the extensive reforms to Israel's  telecommunications market to stimulate price 
competition.  We also note that the Israel does not have an independent regulatory authority for 
telecoms and the legislative process to establish a communications authority has been suspended.  
Could Israel please advise why the legislative pr ocess to establish a communications authority was 
suspended, and if there are plans to reinstate the process? 
Answer:  
The establishment of an independent authority con tinues to be on the public agenda and in 2010 
the legislative procedures to establish an indepe ndent communications authority were renewed and 
a draft bill to this effect was circulated for comments.  
Notifications to the WTO 
Australia welcomes Israel's effort in updating some  of its outstanding WTO notifications.  Can Israel 
provide advice on its plans to address its  remaining outstanding notifications? 
Answer: 
Israel has recently submitted updated notifications, in  the areas of import licensing and agriculture.  
Israel will continue its efforts to reduce the num ber of outstanding notif ications during 2013. 
SINGAPORE 
Part I:  Secretariat Report, WT/TPR/S/272 
II. Trade Policy Regime:  Framework And Objectives 
Page 49, paragraph 102 
We note that State-owned enterprises continue to play  an important role in Israel's economy and that 
these include two companies that have been decl ared as monopolies under the Competition Law.  In 
cases where dumping has been established, are ther e differing actions which Israel may undertake 
depending on whether the market is dominated by an SOE/monopoly?  
Answer: 
There are no specific provisions in Israel's anti- dumping legislation which address the situation in 
which the market under consideration is dominated by a SOE or monopoly. Nonetheless, since the 
Law in Article 32 (18) requires that when deciding to impose a duty, in all cases the Minister of Industry, Trade and Labor, shall take into account, inter alia, "reasons pertaining to the 
economy", the Advisory Committee and the Commissioner of Trade Levies do in fact analyze the 
effect a duty would have in the market includin g  in cases where the market is dominated by a 
single firm. WT/TPR/M/272/Add.1 
Page 20  Part II:  Government Report, WT/TPR/G/272  
Page 11, paragraphs 8-19 
27. Apart from rapid interest rate-cutting, has the Israeli government, through its various arms and 
agencies, introduced any schemes or tools intended to  help the local industry overcome the indications 
of slowing economic activity and prospect of risks po sed by the crisis in other markets? If so, could 
Israel share any details on these schemes?  
Answer: 
As indicated in the summary part of the Secretar iat's Report (paragraph 1), there was no need for 
any bank bailout or major stimulus programs,  although the Government has substantially 
increased its exposure to credit guarantees in order to stimulate exports. 
The specific measures which have been taken by the government in the area of credit guarantees 
("Top up 1&2") are discussed in detail in paragraphs 63 & 64 of the Secretariat's report. 
Page 17, paragraph 48 
28. Singapore lauds Israel's continued research and development focus as a means of driving 
economic growth, and in particular , growing Israeli exports interna tionally.  We note that Israel 
encourages "R&D collaboration both on the national level and internationally". For the latter, we 
would appreciate if Israel could share on the role of  R&D Agreements in Israel's foreign trade policy, 
and if the focus is on talent attr action or research collaboration.  
Answer: 
The Office of the Chief Scientist operates s everal international collaboration programs with 
different countries.  
The focus of almost all of them is on research collaboration rather than on talent attraction. 
The OCS strives to bring together Israeli companies with global leaders in research projects, 
creating value for both parties. Israeli innovative companies offer innovative technologies, while 
international companies provide the Israeli partners with channels to world markets and marketing 
support. 
HONG KONG, CHINA 
Part I:  Secretariat Report III. Trade Policies And Practices By Measures Page 25, Paragraph 12 Tariffs and tariff quotas 
The last Trade Policy Review of Israel in 2006 id entified 11 tariff lines where the applied MFN rates 
exceeded the corresponding bound rates.  One of the tariffs concerned (HS 070959200 – truffles) 
remains higher than the corresponding bound rate.  Th e Secretariat has been unable to undertake an 
exhaustive analysis due to difference in HS nomenclatures.  WT/TPR/M/272/Add.1 
 Page 21 
 
 
Could Israel explain why the applied tariff rate for truffes (HS 070959200) remains higher than the 
bound rate?  Are there other tariff lines where the applied rates exceed the corresponding bound rates?  
If so, please provide the details. 
Answer: 
According Israel's customs tariff of 2012, the MFN rate for truffles (HS 07059200) is 10%. 
This rate is within Israel's Uruguay Round agr icultural commitments, where the bound rate for 
truffles is 34% (at the end of the implementation period). 
Therefore, Israel considers that the rate for truffles does not exceed the bound rate. 
Israel is not aware of instances of tariff lin es exceeding the corresponding bound rates. 
Page 30, paragraph 30 
Contingency trade remedies Israel notified the WTO's Committee on Anti-Dumping Practices and Committee on Subsidies and 
Countervailing Measures in 2006 that implementing provisions for its "Trade Levies Law" (later 
renamed as "Trade Levies and Safeguard Measure s Law") on, inter alia, calculation of production 
costs, comparison between export price and normal va lue, content of complaints, and the conduct of 
investigations, were under preparation.  However,  no such provisions have yet been approved.   
Does Israel have any concrete timetable to put the implementing provisions in place so as to provide 
greater predictability in Israel's  trade remedy proceedings?   
Answer: 
Israel's experience has shown that the provisions of the Trade Levies Law  as amended in 2005,  
themselves, are detailed enough so as to provide predictability in the proceedings and therefore at 
this point there is no concrete timetable to promulgate implem enting provisions.  
IV. Trade Policies By Sector Page 73, paragraph 70 Financial services 
Temporary capital restrictions were imposed and some tax incentives were removed in 2010 because 
of the strong inflow of foreign funds.      
Has the Israel Government taken any measures to consult or inform the foreign investors before 
implementation of these measures?  Would the author ities consider reviewing the existing policies and 
measures with a view to liberalizing the foreig n entry and making the financial system more 
competitive, for instance, by lifting the capital restrictions on foreign investment?  
Answer: 
The measures introduced by Israel were required in light of sharp increase of foreign capital 
inflows, mainly through short term investment. The  measures were designed to cope with the effects 
of capital inflows on the exchange rate and ensure financial stability. WT/TPR/M/272/Add.1 
Page 22  As a complementary step, tax exemptions for fo reign investors on investment in state bonds and 
short term borrowing were canceled. As these ar e temporary measures, the regulatory agencies 
monitor the capital mark et situation closely . 
Pages 74-75, paragraph 78 Telecommunications 
While tariffs for telecom services were not regulated  in competitive market segments and prices of 
broadband access were not under tariff control, all tariffs by all operators were required to be 
"reasonable" and were subject to ex-post regulatory intervention if they failed to meet reasonableness 
criteria (the "reasonableness" is "a general cl ause whereby conditions differ, depending on the 
situation, which allows the regulator some discretion").   
We would like to know the number of ex-post regu latory interventions that have been implemented 
since the last trade policy review of Israel in 2006.  Has the au thority referred to any international 
standards or practices when considering the reasonabl eness of the tariffs?  Is there any mechanism for 
operators to appeal against the ex-post regulatory interventions?  
Answer: 
The Ministry of Communications does not maintain a list of ex-post regulatory interventions, owing 
to the fact that they are of different orders of magnitude, ranging from particular interventions in 
consumer issues to more general competitive issues.  
In considering the reasonableness of tariffs, th e Ministry considers both the absolute tariff level 
and the market power of the operator involved. One example of such an intervention was the 
Ministry's decision that the local incumbent must offer broadband access without a fixed phone 
line "naked ADSL", at the same price that th e product is offered with a phone line.  
Ex-post interventions are carried out after a comp rehensive hearing process, and operators may of 
course appeal to the administrative court. 
Page 76, paragraphs 80-81 Postal services 
The state-owned Israel Postal Company (IPC) domin ated the market and monopolized the transfer of 
postal items of less than 500g (not including bulk mail) .  IPC, via its subsidiary, provided a wide range 
of banking services, credit products and services, and issued VISA credit cards (prepaid card only).  The privatization plans of IPC have been shelved.   
Please share with us the number of IPC subsidiaries, the types of services provided by IPC or its 
subsidiaries at present.  What is the development di rection of IPC in near future?  Would IPC further 
expand its business in service sectors other than postal and financial sectors?  Would the Israel 
Government consider privatizi ng IPC or its subsidiaries?  
Answer: 
The IPC currently provides traditional postal services such as letter and package delivery, 
messenger service, etc., and in addition has diversifi ed into a number of other businesses such as 
financial services, etc. The financial services are prov ided by a subsidiary, Israel Postal Bank, and 
2 more subsidiaries are planned, one for insuran ce services and one to become a virtual mobile 
communications operator (MVNO). IPC's strategy in recent years has been to continue moving into 
new lines of business, both by providing new pr oducts and by increasing the number of outlets  WT/TPR/M/272/Add.1 
 Page 23 
 
 
(such as agencies at gas stations, etc.). A vice-pres ident for strategy has recently been appointed in 
order to spearhead this initiative. 
Regarding privatization, in 2010 the IPC issued bonds in the sum of 400 million NIS and published 
a prospectus, which may serve as the basis for a privatization prospectus. However, at this time 
there are no concrete plans to  privatize the company. 
Page 77, paragraph 84 It was noted that reform of the port sector en compassed the establishment of three state-owned 
companies to operate the Israel's commercial seaports, a state-owned company for management, maintenance, and development of port infrastructure and real estate (i.e. Israel Ports Development and 
Assets Company), and the Shipping and Ports Aut hority as the regulator of  ports and maritime 
shipping services.  The privatization of a port comp any was planned to be completed by end of 2012 
while the privatization of other two port companies, which was due to begin in February 2010, has not 
been implemented.  
Grateful if the Israel Government could share w ith us the current situation and the implementation 
plan of the privatization of three state-owned port companies. Would the Israel Government consider 
privatizing the Israel Ports Development and Assets Company? 
Answer: 
According to the Shipping and Ports Act 2004, Israel Ports Development and Assets Company will 
remain a government owned company. 
The Government of Israel is in final stage of selling 100% shares of Eilat Port Company to a 
private entity. 
Privatization of the ports of Haifa and Ashdod is  not discussed currently. These privatizations will 
be promoted in the framework of the completio n of the overall structural reform of the port 
industry. 
Page 80, paragraph 98 Tourism 
The Israel Government provided various incentive measures for the tourism sector.  These included 
grant for investments in establishing, expanding or  renovating hotels in the priority regions, fund for 
hotel renovation, exemption from VAT, etc.  
Do the suppliers with foreign capital enjoy these incen tives?  Do they enjoy the same treatment as the 
local companies in the tourism sector? 
Answer: 
Suppliers with foreign capital who invest Israel's tourism sector enjoy the same treatment as local 
companies and in certain cases even enjoy preferable treatment. 
Foreign investors may be exempt from tender requi rements for the allocation  of land for tourism 
purposes. This exemption requires special authoriz ation from the relevant ministers (finance and 
tourism). WT/TPR/M/272/Add.1 
Page 24  EUROPEAN UNION 
II. Trade Policy Regime:  Framework And Objectives  
(2) Participation in the WTO (b) MERCOSUR 
The Report states that Argentina signed an  FTA with MERCOSUR in December 2007. 
Implementation of the Agreement with Argentina,  Argentina and Argentina started on 1 June 2010 
and with Argentina 9 September 2011. The Agreement has not yet been notified to WTO. 
Could Israel indicate when they foresee to notify this  FTA, clarifying why it has yet not been notified? 
Answer 
The issue of notification to the WTO of the Agree ment was discussed bilaterally during the first 
meeting of the MERCOSUR – Israel Joint Committee, held in April 2012.  
The Committee could not convene until a ll MERCOSUR States ratified the Agreement. 
Regarding the WTO notification obligation, the Parti es agreed to continue consultations in order to 
comply with their obligations under the WTO Agreement. 
III. Trade Policies And Practices By Measure (1)  Measures Directly Affecting Imports 
(i)  Customs procedures and trade facilitation 
Page 21, paragraph 2 
The Report states that for custom s clearance, the requisite documentation includes, among others, a 
certificate of origin.  
Could Israel clarify whether this obligation also includes non-preferential imports?  
Answer: 
It should be clarified that in fact Israel req uires certificates of origin only for imports under 
preferential agreements to which Israel is a party.    
Could Israel explain the reason for this obligation, in view of its acceptance of Annex D to the WCO 
International Convention on the simplification a nd harmonisation of customs procedures (Kyoto 
Convention), laying down that a certific ate is only required where necessary? 
Answer: 
In light of our answer to question 38 above, this question is irrelevant.   (ii) Tariffs and tariff quotas Page 25, paragraph 15 
The Report affirms that within the framework of its trade agreements, Israel applies preferential rules 
of origin, based on value-added criteria, or change in tariff heading (Table II.1). Furthermore, Israel  WT/TPR/M/272/Add.1 
 Page 25 
 
 
does not maintain non-preferential rules of origin. Ho wever, in some other paragraphs (paragraphs 38, 
40, 123) reference is made to "origin" or "true origin".  
Could Israel explain how "origin" is determined in these cases?  
Answer: 
Origin is determined on the basis of the impor ter's declaration included in the importation 
documents. 
Could Israel clarify whether this obligation also  includes non-preferential imports? In case of positive 
answer, could Israel explain which criteria determ ine the origin in those certificates? Does Israel 
accept that these certificates are based on the origin rules of the exporting country? 
Answer: 
Since we accept the importer's declaration there is no need for non- preferential rules of origin. 
Please note that Israel has been following with interest the negotiations held in the WCO and WTO 
on harmonized rules of origin and did not want  to establish specific rules of origin while the 
negotiations were on-going.  However since the ne gotiations have not resulted in an agreement, 
Israel is currently re-examining its position regarding this matter.  
In the absence of harmonised rules for non-preferen tial origin, every country may establish their own 
rules. As a consequence, the same processing opera tion which in one country confers a new origin on 
a product may result in the product maintaining the or igin of its components in another country. Under 
these circumstances, does Israel agree that the requirement of a certificate of origin for non-
preferential purposes represents an unnecessary burden for exporters? 
Answer: 
As mentioned above we do not require certificat es of origin for non-preferential imports. 
(ii) Tariffs and tariff quotas Page 25, paragraph 15 
The Report affirms that within the framework of its trade Agreements, Israel applies preferential rules 
of origin, based on value-added criteria, or change in tariff heading (Table II.1). Furthermore, Israel 
does not maintain non-preferential rules of origin. Ho wever, in some other paragraphs (paragraphs 38, 
40, 123) reference is made to "origin" or "true origin".  
Could Israel explain how "origin" is determined in these cases?  Could Israel clarify whether this obligation also  includes non-preferential imports? In case of positive 
answer, could Israel explain which criteria determ ine the origin in those certificates? Does Israel 
accept that these certificates are based on the origin rules of the exporting country? 
In the absence of harmonised rules for non-preferen tial origin, every country may establish their own 
rules.  As a consequence, the same processing opera tion which in one country confers a new origin on 
a product may result in the product maintaining the or igin of its components in another country. Under 
these circumstances, does Israel agree that the requirement of a certificate of origin for non-
preferential purposes represents an unnecessary burden for exporters? WT/TPR/M/272/Add.1 
Page 26  
Could Israel confirm that the indication of a Customs Union such as "European Union"/"EU" is 
accepted for the purposes of origin labelling on imported products? If not, why not? 
Answer: 
Labeling is required for purposes of consumer in formation. For this pu rpose Israel requires the 
label to carry the name of th e country where the goods have been produced or assembled. 
Therefore, labeling with names of international entit ies such as the "EU" is not accepted under the 
law.  
(iii) Other taxes and charges Page 27, paragraph 20 
The Report explains that for the imposition of pu rchase taxes on imported products, Israel uses an 
assessment called TAMA (the Hebrew acronym for additional rate of increase). The TAMA 
approximates local wholesale prices by adding estimated  profits, insurance, and inland freight to the 
declared value of imports (coefficients for calcula ting the TAMA vary from product to product).  The 
effect of the TAMA is similar to an import surcharge. 
Could Israel make clear whether it applies to all im ported products with no exception? Is a temporary 
or permanent tax? 
Answer: 
The TAMA is applied to a limited number of im ported goods where a purchase tax is imposed and 
is expressed in ad valorem terms rather than sp ecific duties. Currently, it is applied mainly to 
automotive spare parts and alcoholic beverages. The TAMA is scheduled to be cancelled in 2014 for 
alcoholic beverages.  
May Israel elucidate whether is th e TAMA used for a specific purpose? 
Answer: 
The purpose of TAMA is to equate the pu rchase tax calculation basis for domestically 
manufactured goods and imports. As the basis for calculation of the tax for domestic goods is the 
wholesale price (thus increasing the calculation basis) the TAMA is added to the import price to 
bring the import prices to the same level as the domestic goods.  
(vi) Standards, technical regulat ions, and conformity assessment 
Page 34, paragraph 41 
The Report underlines that the SII has published 3,192 standards (2,600 in 2005).  As of January 2012, 
552 standards (excluding food standa rds) were mandatory. The report continues maintaining that 
mandatory standards are particularly important in electrical and mechanical engineering. 
Regarding electrical appliances (washing machines, te levisions, ovens, microwaves, may Israel clarify 
whether SII accepts audits from European labo ratories when it concerns domestic electrical 
appliances?    WT/TPR/M/272/Add.1 
 Page 27 
 
 
Answer: 
The Standards Institution of Israel (SII), is a member of the IECEE CB Scheme international 
network.  Accordingly, the SII recognizes test certificates of laboratories and notified bodies from 
all over the world, including members of Europe an Union, which are members of the scheme.  
(iii) Measures affecting production and trade 
(i) Incentives 
Pages 40-41, paragraphs 72-78  Law on Encouragement of Capital Investment 
According to the Report, under the Law on Encourag ement of Capital Investment, companies, mainly 
manufacturers, benefit from tax incentives and gr ants with preference given to: (i) priority 
development regions in the periphery of the country;  (ii) export-oriented enterprises, and (iii) large 
multinationals.  The law also authorizes special in centives for the tourism. The incentives can be in 
the form of a grant or for investment in fixed assets, in certain eligible regions, or in a form of special 
tax breaks or employment subsidies. The eligibility cr iteria include:  investment projects must be in 
the industrial sector; enterprises must export at least 25% of sales; generation of  high value-added; and 
registration of the company in Israel  
Could Israel clarify which is the maximum aid intensity that can be granted to a company? Could 
Israel clarify whether the tax incentiv es and the grant can be combined?  
Answer: 
The maximum aid according to the Law on Encouragement of Capital Investments: 
 - Grants of 20% on the capital investments in priority area A.  -  Tax rate of 10% in priority area A an d 15% in other regions. These tax rates will be 
reduced to 6% and 12% respectively in 2015.  
 - In special cases, where the enterprise provides data showing its substantial 
contribution to the economy and when the enterprise meets the standards of "special preferred enterprise", the benefits will be: a tax rate of 5% in priority 
area A and 8% in other regions. In add ition, the enterprise will be entitled to 
accelerated depreciation acco rding to the law.   
 - The tax incentives and the grant can be combined.  
10. Would it be possible to know the proportion of aid given to SMEs compared to large 
enterprises?  
Answer: 
80% of the grants' budget is allocated to SMEs on  condition they meet the criteria of the law and 
regulations. The remaining budget is allocated to large enterprises that meet the standards of the 
law and regulations.  
According to paragraph 75, also la rge (multinational) companies can benefit of incentives in the form 
of special tax break. 
Could Israel clarify which is the ratio fo r giving aid to multinational companies? WT/TPR/M/272/Add.1 
Page 28  Answer: 
Paragraph 75 of the Secretariat's Report should be  understood to refer to the benefits to all "special 
preferred enterprises" and does no t refer necessarily to multinationa l companies. Although in some 
cases the benefits may go to multinational companies, meeting the criteria established by the law.   
The rationale behind granting benefits to "special  preferred enterprises" is to encourage large 
enterprises that are expected to make substan tial contributions to the economy and to promote 
national objectives, through investment in Israel.     
Page 41, paragraph 79  Incentives for research and development  
According to the report, most governmental R&D programmes have been authorized under the Law 
on the Encouragement of Industrial Research a nd Development (5744) of 1984 (last amended 
in 2011), and are administered by the Office of th e Chief Scientist (OCS) at the MOITAL. The leading 
OCS-administered programme is the R&D Fund, which supports projects by companies registered in 
Israel with grants of up to 50% of approved expenditures. Project grants are repayable in the form of royalties in case of commercial success.   
Could Israel explain how do the repayable advances work? 
Answer: 
A company is obligated to pay royalties when a government-assisted R&D project results in a 
commercially successful product. 
Royalties are used to fund future grants that  encourage and support industrial R&D.  
Normally, royalty payments are a specified percenta ge of the total annual revenues derived from the 
sale of a developed product. These are 3% of revenues during the first three years and 3.5% from the third year onward.  
Total royalty payments may not exceed the amount  of the grant plus interest, except in cases 
involving the transfer of production rights abroad, which involve different conditions.   
(ii) Competition policy and price controls 
According to the report, the last remaining sectoral exclusions of the competition law are in maritime 
transport and agriculture. With respect to mar itime transport, in 2011 the Knesset repealed the 
statutory exemption for arrangements between shippi ng carriers, effective July 2012.  The authorities 
expect that the statutory exemption will be replaced by a block exemption, which will apply to consortia arrangements. 
11. "The Israeli Parliament repealed the sectorial exemption for shipping services from the Israeli 
Competition Act in July 2012. You state that the exemption is likely to be replaced by a block exemption which will apply to shipping consortia . Please provide additional information about the 
contents of the future block exemp tion and the timing for its adoption." 
Answer: 
The expected maritime transport block exemptio n will apply to operation Agreements and practices 
between liner shipping companies (consorita). The block exemption substantially follows the 
European Commission Regulation (EC) No 906/2009 on The Application of Article 81(3) of the 
Treaty to Certain Categories of Agreements, Decisions and Concerted Practices Between Liner 
Shipping Companies (Consortia), with adaptatio ns necessary for the Israeli economic and legal  WT/TPR/M/272/Add.1 
 Page 29 
 
 
context.  In essence, the Block Exemption relates to consortia Ag reements in international liner 
shipping, and excludes Agreements relating to pri ces and hard-core cartels. It provides a safe 
harbor for consortia Agreements where the par ties have up to 40% market share; above that 
threshold the block exemption requires that the Ag reement will not substantially harm competition 
in order for it to be exempted from the require ment to seek a prior approval from the antitrust 
authority or court.  It is expected that the block exemption will come into force by January 2013.  
(v) Trade-related aspects of intellectual property rights (TRIPS) Page 51, paragraph 114  Industrial property rights  
Paragraph 114 describes the procedures on the publica tion of patent appli cations and on patent 
opposition. With reference to the publication of pate nt applications after 18 months from filing, the 
EU would like to raise the following questions: 
12. Does the draft text keep providing for the possi bility for substantial amendment of patent 
applications after publication provided the amendmen ts are supported by the disclosure in the initial 
application? 
Answer: 
The 18 month patent publication amendment to the Patent Law was enacted in July 2012. The 
amendment made no alteration of existing legislat ion with regard to amending of pending patent 
applications. Applicants can make substantive amendments of their pending applications provided 
that such amendments are supported by th e disclosure in the initial application.  
What is the current state of play of the legi slative process with respect to the draft text? 
Answer: 
It was enacted in July 2012.  
When is adoption by the Knesset envisaged? 
Answer: 
It was enacted in July 2012.  
With reference to the patent opposition, the EU would like to raise the following question: 
13. What is the state of play with respect to the envisaged review of Israel's policy on pre-grant 
patent oppositions (to shift to post-grant opposition)? 
Answer: 
Israel has internally reviewed the possibility of  shifting to a "post-grant" opposition system and 
continues to find a strong public interest in p reventing the grant of unjustified patents served by a 
pre-grant opposition system. In addition, current data indicates that on average approximately only 
1% of filed patent applications are opposed. Few op position actions proceed to trial, and many end 
in either a withdrawal of the opposition or aba ndonment of the pending patent application. 
Accordingly, at this time Israel believes there is no  need in a policy change, in the substantive law. 
However, possible reform may focu s on streamlining of opposition procedures in order to bring 
opposition claims to a speedier resolution.  WT/TPR/M/272/Add.1 
Page 30  Page 52, paragraphs 115-116  Industrial property rights  
With reference to the Patent term extension, th e EU would like to raise the following questions: 
What is the current state of play of the legi slative process with respect to the draft text? 
Answer: 
The Bill passed its first reading in the Knesset  in May 2012 and is presently pending before the 
Knesset Constitution, Law and Justice Committee fo r discussion and preparation for second and 
third readings. These parliamentary hearings may take place in the final quarter of 2012 or 
possibly only after the upcoming January 2013 parliamentary elections. 
14. Does the current text keep explicitly mentioni ng that an EU SPC is accepted as a reference 
PTE Order on the basis of which an IL PTE Order may be granted provided the necessary conditions 
stipulated in the law are fulfilled? 
Answer: 
That is the intention of the Bill and stated so explicitly in the Bill's explanatory notes. The statute 
itself does not specifically state an "EU SPC" bu t rather provides a definition of a "reference 
patent" that is designed to unequivocally incl ude an EU SPC and an US  PTE Order. Moreover the 
Bill provides a specific list of reference countries  that include the US and 5 countries from the 
European Union. Any reading of the Bill that would imply exclusion of an SPC would be 
inconsistent with that closed list of reference countries.  
Page 52, paragraph 117  Industrial property rights  
With reference to the Patent opposition, the EU would like to raise the following question: 
Is the adoption of measures introducing data protec tion for biologicals envisaged? Is there a time-line 
for such legislative amendment? 
Answer: 
There is no plan at this time. IV. Trade Policies By Sectors (1) Agriculture  
(iii) Domestic Programmes  
Page 60, paragraph 17  The Report mentions that Israel has applied an ad ministered price for wheat, according to OECD. The 
minimum prices are implemented by the MARD through purchases of wheat for human consumption into the public food security reserve for emergency purposes (operated by the private sector).  The entire domestic wheat production, accounting for abou t 5-20% of domestic consumption, has been for 
public procurement.   
Could Israel explain how is the applied administered  price for wheat accounted for in Israel domestic 
support notifications?  WT/TPR/M/272/Add.1 
 Page 31 
 
 
Answer: 
The price published by MARD is a recommended price for purchase of wheat from local producers 
to be later stored as food security stocks. This pr ice is based on international markets and CIF price 
of wheat taking into account parameters such as quality of the wheat. 
In any case, the price reflects alternative import costs that would have been paid by the private 
contractors. 
The required quantity for food security stockholdi ng is then supplemented by import from the 
international markets. Therefore, it is not re garded as a domestic suppor t measure. The support 
provided by the government for public stockholdi ng of wheat for food security purposes is notified 
regularly. 
EUROPEAN UNION – SET 2 
Secretariat Report, WT/WTPR/S/272 
III. Trade Policies And Practices By Measure (1)  Measures Directly Affecting Imports 
(iii) Other taxes and charges 
Page 27, Paragraph 20 – Follow up question The EU thanks Israel for their replies on TAMA. According to these replies, TAMA is currently 
applied mainly to automotive spare parts and alcoho lic beverages. TAMA is scheduled to be cancelled 
in 2014 for alcoholic beverages.  
Could Israel clarify to which products will TAMA  be applied as from 2014, once the scheme will be 
cancelled for alcoholic beverages? 
Answer:  
The TAMA is expected to apply to a limited num ber of categories, mainly auto spare parts.  
Could Israel clarify what is the level (in %) of the current and future TAMA uplift on these products? 
Answer: 
The TAMA on alcoholic beverages (until 2014) is 1 00% (NIS 20.98 per liter of alcohol plus 75% of 
the c.i.f. price), while the TAMA on automoti ve spare parts is 60% (12% of purchase tax). 
(vii) Sanitary and phy tosanitary measures 
Page 36, paragraphs 51-52 
According to the report, under the Kosher Meat Import Law, imports of non-kosher meat and meat 
products are prohibited.  Israel has been for decad es maintaining a ban on imports of non-kosher meat 
for religious/cultural reasons. That contradicts with  the reality, when non-kosher meat and meat 
products produced locally are available in the market.  
Could Israel explain whether it means that local producers are favoured and protected from foreign 
competition? WT/TPR/M/272/Add.1 
Page 32  Answer:  
The intention of regulating imports of kosher meat is only for religious purposes. As we explained 
in our initial response the enactment of the Kosh er Meat Import Law came as a direct response to 
the privatization of importation of meat. 
It should be noted that The Law Prohibiting the Raising of Pigs- 1994 is intended to regulate the 
domestic production of pigs which is the most prominent of non-kosher meats.  
(2)  Measures Affecting Production and Trade 
(iii) Government procurement  Pages 45-46, paragraphs 93-95 
The EU appreciates active role and participation of Israel in the negotiations of the revised GPA. As 
the Israeli obligatory offset regime (called industr ial cooperation) created a great burden and obstacle 
especially for SMEs to compete in the governme nt procurement market, the EU welcomes the 
commitment of Israel to phase out its offset regime with respect to procurement covered by the GPA, progressively reducing the current 20% offset level and eliminating offsets entirely after 15 years from 
the entry into force of the revised GPA for Israel. 
In this context, the EU would ask Israel to shar e any information relating to the state of play of 
depositing the deposit the instruments of acceptan ce and the time schedule for progressive reduction 
of the current 20% offset level.  
Answer:  
Israel is currently in the process of ratifying the amended agreement in order to be in a position to 
deposit its instruments of acceptance. The offset reduction schedule will be implemented according 
to the time table specified in Israel's schedule. 
IV. Trade Policies By Sector 
(4) Services (ii) Telecommunications and postal services Page 73, paragraph 73 
The report is very interesting from the perspectiv e of dealing with regula tion and de-regulation of 
Israeli telecommunication market. 
Is there any idea how the Government of Israel w ill solve the matter of independent regulatory body? 
Does any time plan exist regarding this matter? 
As there is no independent regulatory body at th e telecommunications market, who then solves the 
disputes between the operators (for example over in terconnection agreements) or disputes between 
operators and users? 
We did not notice that an international (mobile) roam ing is to be regulated. Is it possible to inform 
about Israeli attitude towards this matter?  WT/TPR/M/272/Add.1 
 Page 33 
 
 
There is no remark about the transition to digita l broadcasting and the usage of so called digital 
dividend. Is this step foreseen or  planned? And if so, would Israel accept the solution to transit directly 
to DBV-T2?  
Answers: 
Independent Regulatory Body 
The establishment of an independent authority con tinues to be on the public agenda and in 2010 
the legislative procedures to establish an in dependent Communications Authority were renewed 
and a draft bill on the matter was circulated for comments. The matter awaits further legislation 
procedures.  
The ministry of communication handles disp utes between operators and also regulates the 
operator-consumer relations (in addition to general le gislation in that field). As for interconnection 
– In Israel, interconnection rates for all suppliers a re regulated (not just interconnection rates for 
suppliers with significant market power). This is b ecause in our view, termination on a supplier's 
network is by nature a monopolistic product, even if  that supplier does not have significant market 
power.  We believe our approach allows for more cl arity for the market and avoids arbitrage 
possibilities through inefficient routing of ca lls due to fragmented interconnect agreements. 
International roaming The Government of Israel strongly believes that international roaming charges must be brought 
into line with costs, in order to increase consum er welfare and remove barriers to trade and travel. 
However, as the Ministry's of communication's jurisdiction only extends within the national 
borders, we cannot effectively regulate intern ational roaming rates without international 
cooperation. 
To this end the Ministry has been active in in ternational bodies, including the OECD and in 
conversations with the European Commission, in an  effort to find an effective, cross-border 
solution to the problem. In fact, Israel had previously approached th e European Commission 
suggesting that the Commission allow third countries  to join the European roaming arrangements 
on a reciprocal basis  It is evident that the Israeli regulato r cannot oblige Israeli operators to lower 
the roaming rates they charge foreign operators, without a corresponding decrease in the rates paid 
by Israeli operators abroad. 
While these efforts have so far not been successful, we continue to press for a solution to this issue . 
Digital broadcasting Israel switched off analogue TV broadcasting in  mid-2011. An independent governmental agency 
(The Second Authority for Television and Radi o), responsible for commercial channel content 
regulation, operates one Multiple xer carrying 6 SD free to air channels. Two additional 
Multiplexers (one HD and the other SD) are expect ed to start operating at the beginning of 2014. 
Due to the legacy of rather low usage of VHF and UHF frequencies by analog TV - 100 MHz in the 
UHF band and about 60 MHz in the VHF band-the magnitude of the digital dividend in Israel is 
small . Israel plans to use the digital dividend as follows: 
 - 100 MHz in the UHF band will be saved  for the future development of DTT 
platform for a total operation of 5 or 6 muxes.  WT/TPR/M/272/Add.1 
Page 34   - The 60 MHz in the VHF band will be saved for the future development of digital 
radio broadcasting (DAB-2).  
EUROPEAN UNION – SET 3 
Page 41, Paragraph 79  Incentives for research and development 
According to the report, most governmental R&D programs have been authorized under the Law on 
the Encouragement of Industrial Research and De velopment (5744) of 1984 (last amended in 2011), 
and are administered by the Office of the Chie f Scientist (OCS) at the MOITAL. The leading OCS-
administered program is the R&D Fund, which suppor ts projects by companies registered in Israel 
with grants of up to 50% of approved expenditures. Project grants are repayable in the form of royalties in case of commercial success.  
Could Israel explain how do the repayable advances work?  Answer: 
A company is obligated to pay royalties when a government-assisted R&D project results in a 
commercially successful product. Ro yalties are used to fund futu re grants that encourage and 
support industrial R&D. Normally, royalty payment s are a specified percentage of the total annual 
revenues derived from the sale of a developed product. These are 3% of revenues during the first 
three years and 3.5% from the third year onward . Total royalty payments may not exceed the 
amount of the grant plus interest, except in cases involving the transfer of production rights abroad, which involve different conditions.   
Follow-up question:  EU would appreciate some in formation regarding the amount of money and the 
percentage of failed innovation projects involved in the R&D Fund, to which Israel referred in their 
answer to the following question from the European Union. 
Answer: 
Since technological success/failure and/or spillover effects are very hard to measure and requires 
extensive analysis, we will refer to the term 'faile d innovation projects' as ones that didn't generate 
any revenue. 
This measure by itself should not be mistaken with technological or economic  "success".  In the 
last decade roughly 45% of the projects in the R&D fund generated revenues.  
The graph below presents the royalties the OCS received both in financial terms and as a 
proportion of the R&D fund. Other OCS programs (t echnological incubators, consortia etc.,) are 
focused on activities which are by nature further from  the market so they don't usually generate too 
much sales and royalties.  WT/TPR/M/272/Add.1 
 Page 35 
 
 
 
MEXICO 
Israel is kindly requested to answer the follo wing questions based on what was stated in the 
documents WT/TPR/S/272 and WT/TPR /G/272 dated September 25, 2012. 
Government Report, WT/TPR/G/272 
Employment and labour market 
Page 12, paragraph 22 
What are the measures the Government of Israel in tends to implement in order to increase the labour 
force participation rate? 
Answer: 
An active labor market policy is currently at the top of the socio- economic agenda of the 
Government of Israel. Efforts are being particularly targeted for groups with low participation rates 
in the labor market, such as Arab women, Hared i men and those who are clients of the social 
services. 
Among the steps taken: 
 - creation of one-stop employment centers, including a network of 21 centers 
specifically designated for the Arab population 
 - expansion of the vocational training program through the use of vouchers; 
development and expansion of programs to  encourage business entrepreneurship  
 - expansion of the National Civic Volunta ry Service (as an alte rnative to military 
service) Royalties 
as part of 
the R&D 
Fund The rest of 
the R&D 
Fund 
budget WT/TPR/M/272/Add.1 
Page 36   - the development of industrial parks in disadvantaged communities  
 - extension the earned income tax cre dit (EITC) across the country and increase 
support for working parents  
 - removal of barriers to employment for gr oups with a low participation rate by 
increasing investment in education 
 - improved transport infrastructure in the periphery and Arab localities 
 - assurance of a more proactive policy to capitalize on the ability to work of people 
with disabilities 
 - increasing regulatory capa city for more effective enforcement of labor laws. 
Major initiatives on structural and sectoral reforms Page 16, paragraph 41 
The Government of Israel states that in 2007 it was near completing a decentralization process of the 
banking system that allowed the emergence of a more independent advice network in banks, which 
was free of conflicts of interest and was more easily accessible to the public. Could you explain how 
these consultants avoid conflicts of interest while  at the same time ensuring professional competence 
and quality of service? Are these advisors inde pendent or are they employees of the banks? 
Answer: 
The process referred to was the implementation of  the recommendations of the Bachar Committee 
that legally required banks to sell their interests in mutual fund management firms and provident 
funds (producers), while at the same time legislating a flat across-the-board distribution fee from all producers so that there is no longer an incen tive to prefer products of certain producers. The 
reform eliminated the most significant conflict of  interest between bank advisors and their clients. 
The advisors are still bank employees but the law requires that they do not prefer the interest of 
their employer over the interest of the client (Section 11 of the Advisors Law) and the ISA routinely conduct inspections and enforces their compliance with the law.  
Page 16, paragraph 43, subparagraph a) 
Regarding the rules on transparency for the alloca tion of public assets in the recent privatization 
processes, could you tell us what are they and how do they work? Are there public tender procedures 
for allocating these assets? Could you describe the de gree of discretion used by the Government of 
Israel in awarding these assets and/or businesses to a private company? 
Answer: 
Privatization of a public asset is in accordan ce with the Public Tenders Law, Mandatory Tenders 
Regulations, and provisions issued by the Account ant General, which set the legal framework for 
the process, including tender procedures. In gen eral, public assets are allocated to the highest 
bidder. All tenders are disclosed to the public.  WT/TPR/M/272/Add.1 
 Page 37 
 
 
Page 17, paragraph 43, subsection b) 
What is the meaning of "significant real entity" accord ing to the Government of Israel, and what is the 
reason for prohibiting these entities from becoming sh areholders and/or participating in mayor 
financial institutions? 
Answer: 
The definitions of significant financial and rea l entities presume that such entities significantly 
affect the whole economy.  A significant real entity is defined as: 
a. The entity's annual revenue in Israel is mo re than 0.4% of Israel's annual aggregate 
revenues (currently 6 billion NIS or roughly 1.5 billion US$);  or 
b. The amount outstanding of the entity's dom estic credit is more than 6 billion NIS.  
The prohibition on controlling shareholders of a significant real entity to control a significant 
financial entity intends to prevent potential conflic ts of interests.  There are two main potential 
conflicts of interests.  First, a significant provider of credit might also be a significant consumer of credit.  Second, the owner of a significant real activity may significantly affect the credit of 
competitors by virtue of being a significant provider of credit. 
Page 22, paragraph 64, subsection 1) In the context of the 2007 copyright law reform of  Israel, what is the difference between the "fair 
dealing" system in place before the reform a nd the "fair use" system currently in place? 
Answer: 
The two systems differ in so far as under the new "fair use" system, like in US copyright law, an 
open ended list of possible uses can be consid ered, whereas under the previous "fair dealing" 
system the fairness analysis would only be applied in respect of a closed list of usage types.  
Secretariat Report, WT/TPR/S/272 Macroeconomic indicators Page 17, paragraph 6 
Over which economic law subjects do the specialized court of Israel hold jurisdiction? Please indicate 
if there are any subjects missing out of the following list: business/commercial law, foreign 
investment, financial law, telecommuni cations law and intellectual property. 
How many of these specialized courts exist in Israel throughout 2012? 
Answer: 
The specialized economic court is authorized to ha ndle civil suits involving certain provisions of 
several laws including the Securities Law, Joint Investment Trust Law, Investment Advisory Law, 
Companies Law, Arbitration Law (appeal of arbi tral decision of an economic nature). Currently, 
one economic court has been established in the Tel Av iv area which is the main financial center of 
the country. WT/TPR/M/272/Add.1 
Page 38  Technical barriers to trade 
Page 18, paragraphs 12-14 
Regarding the Section "Preferentia l Trade Agreements" of the Secret ariat's Report, could you indicate 
whether the recently concluded FTAs by Israel incl ude provisions relating to  regulatory cooperation 
on technical barriers to trade? If so, what are these measures? 
Answer: 
Chapter VI of the Agreement between Israel and MERCOSUR deals with Cooperation on 
Technical Regulations, Standards and Conform ity Assessment Procedures. The main aspects 
covered by this chapter are cooperation in internat ional fora and procedures for developing mutual 
recognition agreements in the future, on a bi lateral level, which ea ch MERCOSUR member. 
Foreign investment regime 
Page 22, paragraph 22 Could you elaborate on the special process of review or approval of investments by foreigners in 
Israel? What are the requirements in order to approve an investment? 
Answer: 
There is no specific legislation which requires the pre–screening or approval of investments by 
foreigners in Israel.  Israel does maintain certa in sectorial laws and regulations, while not 
discriminating between domestic and foreign investors,  may be used in relevant situations, where 
certain activities related to national security issues arise. 
Page 23, paragraph 25 
In the context of investments in industrial project s pursuant to the Law for the Encouragement of 
Capital Investment, as well as other provisions and tax incentives. 
Elaborate on the corporate income tax amounting to 24%  for 2011. Is it a direct tax (on profits)? What 
is the taxable base? How often should it be calculated and collected? 
Answer: 
Currently, the standard company's tax rate in Israe l is 25%, while in 2011 the rate was 24%. 
Generally, the tax is calculated and collected according to the assessments submitted to the tax 
authority and examined by it.  
What is the reason for charging 5% to "special companies"? 
Answer: 
The reason for applying 5% to "special preferred en terprise" is to encourage large enterprises that 
are expected to make substantial contributions  to the economy and promote national objectives 
through investment in Israel. 
How do you determine the multinational nature of a company in order for it to qualify as a "special 
company" and consequently benefit from the tax incentive? Does a single foreign investor with a 
foreign nationality qualify for the same right?  WT/TPR/M/272/Add.1 
 Page 39 
 
 
Answer: 
Paragraph 75 of the Secretariat's Report should be  understood to refer to the benefits to all "special 
preferred enterprises" and does no t refer necessarily to multinationa l companies. Although in some 
cases the benefits may go to multinational companies, meeting the criteria established by the law.   
The rationale behind granting benefits to "special  preferred enterprises" is to encourage large 
enterprises that are expected to make substan tial contributions to the economy and to promote 
national objectives, through investment in Israel. 
What is the difference between the companies re quired to pay 24% and the taxpayers who must 
pay 5% tax? 
Answer: 
Currently, the standard company's tax rate in Israe l is 25%, while in 2011 the rate was 24%. 
Generally, the tax is calculated and collected according to the assessments submitted to the tax 
authority and examined by it. Industrial enterprises which meet the standards of competitiveness are entitled to reduced tax rates. Th e "special preferred enterprise" is  entitled to a tax rate of 5% on 
priority area A.   
Trade remedies Safeguard Assessment. According to the WTO repo rt, these "safeguard duties" are measures that 
unilaterally raise tariffs on imports from "certain countries" in order to remedy certain emergency 
circumstances. Moreover, Israel places these "safe guard duties" outside the scope of the Safeguards 
Agreement and the Agreement on Agriculture. 
Page 37, paragraphs 36 to 38 
Based on the previous paragraph, Israel is request ed to answer the following questions: What is the 
legal nature of these duties and which WTO provisi ons would be applicable to said measures? Are 
they to be considered tariffs and must therefor e be under the scope of Article II of GATT 1994? 
How would a potential increment in tariffs for cer tain countries (and not for all WTO members), be 
consistent with the MFN principle under Article I of GATT 1994? 
In any case, if Israel believes that  this mechanism falls within the scope of the general exceptions 
under Article XX of GATT 1994, we would like to know the reasoning behind it. 
Answer: 
Since these measures are in fact an increase in tariffs, Article II of GATT 1994 would be applicable 
to these measures.  
The measures are under the scope of the MFN pr inciple pursuant to Article I of GATT 1994 and 
therefore the increase in tariffs would apply to all WTO members except to th ose with which Israel 
has an FTA in accordance with Article XXIV of GATT 1994. WT/TPR/M/272/Add.1 
Page 40  Standards, technical regulatio ns and conformity assessment 
Page 38, paragraph 40 
In addition to the provisions contained in the TBT Agreement, could you explain any additional 
measures implemented by Israel in order to ensure transparency when elaborating standards, as well as 
through its publication by MOITAL? 
Answer: 
Under the Standards Law, the Standards Institution of Israel (SII) is the sole body authorized to 
determine that a specification or technical rules for a work process, shall be an Israel Standard.  As 
an integral phase in the full elaboration of a standard, the SII publishes the new standard and distributes it among representatives of the govern ment, the consumers, industry and commerce and 
invites comments.  The existence of the new standar d is then published in Israel's Official Gazette 
and, in the event that the Minister of Industry, Trade and Labor considers declaring the standard 
mandatory, he again declares a period of one mont h for comments, during which representatives of 
consumers, commerce, government etc. are invi ted to comment on the new standard.  Any 
comments are forwarded to the SII where the T echnical Committee responsible for elaboration of 
the standard considers what revisions should be introduced to finalize the standard. In addition, 
Israel's regular WTO-TBT notifications on tech nical changes, usually allowing 60 days for 
comments, enable Israel's trading partners to submit their comments with respect to any new 
standard or revisions of existing ones. 
Page 38, paragraph 41 
It is mentioned that the Government of Israel inst ructed MOITAL to promote MRA's of certificates of 
compliance with Israel's trading partners. Coul d you indicate the specific MRA's and the specific 
countries in question? Which future  MRA's is Israel considering? 
Answer: 
An ACAA with the European Union on GMP (pharm aceuticals) has been concluded and approved 
by the European Union Parliament.   
Israel has signed an MRA on telecommunication equipment with Canada and a similar Agreement 
with the United States. Both agreements  are in the process of ratification. 
Israel is in a process of identifying additional  countries and sectors for possible future mutual 
recognition type arrangements. 
Page 39, paragraph 42 
We understand that there are some difficulties in ha rmonizing Israeli standards with the standards of 
its major trading partners (the United States a nd the European Union). What measures are being 
carried out in order to eliminate these difficulties? 
Answer: 
One way to counter these difficulties would be by adop ting international standards for all of Israel's 
mandatory standards where they exist. Another solution exists under Israel's Standards Law 
mandating a dual system by which producers are gi ven the option of conforming to an American 
standard or a European one. An example of such a dual solution is restra ining devices for children 
in automobiles. Israel's mandatory standard 1107 : "Child restraint devices for motor vehicles"  WT/TPR/M/272/Add.1 
 Page 41 
 
 
entails both European regulation Reg. 44 E/ECE R 44/03 and the American ASME standard 
FMVSS 213. 
Pages 39 and 40, paragraph 43 
Could you explain how a laboratory of the Standards Institution of Israel (SII), performs the procedure 
on compliance testing for both domestic and importe d products? Also, could you indicate how many 
SII certification laboratories exist as well as how they carry out Conformity Assessment procedures? 
Answer: 
1. The product testing laboratories are made up of six main labs which deal with over twenty 
five sub-categories. The six main laboratories which make up the industry division are: 
 - Chemical and Textile Laboratory 
 - Mechanical and Hydraulics 
 - Electronic and Telematic Laboratory  - Electrical Laboratory  - Soil and Infrastructure Laboratory   - Construction Laboratory. 
2. The test procedure for imported products is  based on SII Procedure 401 (which may be 
found on the SII website.) Each individual product test is based on a specific examination designed 
according to the mandatory standard governing the product.  
For domestically manufactured products there are three forms of inspection: 
 a. Mandatory Standard Mark: 
  It is prohibited to market a product th at is required to bear a mandatory standard 
mark unless the manufacturer obtained from th e SII permission to mark it with a 
Standards Mark logo.  The marking is proof that the product is under regular inspection by SII, including: 
 
 -  type approval including approval of its technical file 
   - conformity testing to mandatory standards 
 - inspection of production processes and means of production  - testing of the quality control system. 
b. Voluntary Standard Mark: 
 The manufacturer approaches SII of his own volition and requests to sign an 
inspection agreement. 
 The inspection process is identical to th at employed in the case of mandatory 
standard marks. 
c. Products that are subject to mandatory st andards but are not required to bear the 
mandatory standard mark are inspected through market surveillance activities by 
the Commissioner of Standardization in the Ministry of Industry, Trade and Labor. 
Page 40, paragraph 44 Could you please elaborate in detail the criteria for designating the specific product groups for 
purposes of inspection, as well as a list of pr oducts that are included in each group? WT/TPR/M/272/Add.1 
Page 42  Answer: 
The key criterion for belonging to an inspection group is the degree of potential danger the product 
may cause the consumer.  The lower the potentia l danger, the easier will be its release from 
customs.  
 - Group 1 – The potentially most dangerous, contains such products as electrical 
appliances for home use.  The SII can requi re that each shipment of such products 
be examined for type and for conf ormity to mandatory standards.   
 - Group 2 – The products in this group are potentially less dangerous, hence the SII 
only performs a type examination and accepts a supplier's declaration of conformity to the relevant mandatory standards.   
 - Group 3 – The products in this group do not require a physical examination at all.  
The importer can obtain a certificate of release from customs by supplying a 
declaration (SDoC) that the product conforms to the mandatory standards.   
 - Group 4 – The Commissioner has exempted this group of products which are 
destined for the manufacturing sector.  A lthough they may be listed in the Second 
Addendum to the Free Import Order, the assu mption is that they will be handled by 
professionals with appropriate technical skills, hence they will not prove hazardous 
to the users. 
SPS Page 41, Paragraph 52 
Regarding the Government of Israel's Kosher certification, it is mentioned that these certificates can 
only be issued by the Chief Rabbinate in Israel or by designated Rabbis located abroad. Could you 
elaborate on the process to obtain said certificate, as well as its costs? 
Answer: 
Kosher requirements are derived from  religious dietary practices known as Kahsrut, identified with 
the Jewish tradition. The Chief Rabbinate is the only competent authority to approve the 
compliance of meat and meat products with th e kosher requirements.  A team of specialized 
inspectors from the Chief Rabbinate is sent to the specific manufacturer premises abroad to carry 
out the supervision required. The Chief Rabbinate does not determine the charge.  The charge is 
based on the cost of sending the inspectors to  the manufacturer premis es. The Chief Rabbinate 
upon importation of the products, issues the certific ate based on periodical reports submitted to the 
Chief Rabbinate from the team of inspectors. 
Page 41, paragraph 53 
In relation to meat imports, Israel states that  it only allows imports from approved countries with 
approved establishments and approve d products. Does this apply equally to imports of live animals? 
Answer: 
In the area of live animals, Israel approves countri es, species and categories and conducts its policy 
based on the OIE recommendations and regulations.  WT/TPR/M/272/Add.1 
 Page 43 
 
 
Page 42, paragraph 55 
In relation to plant protection, do the products me ntioned under the fourth schedule footnote No. 28 
require the certificate of origin? 
Answer: 
No such requirement is in place. 
Measures affecting production and trade 
Page 46, paragraph 72 
What is the regulation imposed on foreign comp anies under the Law on Encouragement of Capital 
Investments (5719) of 1959? What is the criterion for determining if a company is "large multinational"? 
Answer: 
There are no specific provisions in the law for fo reign companies. It should be noted that the 
phrase "large multinational" does not appear in th e law. In the case of  "special preferred 
enterprise", the criteria are elaborated in paragraph 75 of the Secretariat Report. The Director Generals of the Ministry of Industry, Trade and Labor and Ministry of Finance must confirm that 
according to the business plan submitted, the company is expected to make substantial 
contributions and promote national obj ectives through investment in Israel. 
Competition policy and price controls Page 48, paragraph 83 
In relation to the independent nature of the regulat ory body of Israel's economic competition, how is 
the top officer of the Israel Antitrust Authority (IAA) appointed? How is the top officer of this 
regulatory body hold accountable, specifically, whic h State Authority holds the officer accountable? 
Answer: 
Section 41 of the Restrictive Trade Practices Ac t 5748-1988 (RTPA) provides that the IAA General 
Director is appointed by the Government, upon a nomination of a candidate by the Minister of Industry, Trade and Labor ("the Minister").  The Minister chooses his candidate from a short-list 
of candidates recommended by a search-committee,  which includes representatives of the Director 
General of the Industry Trade and Labor Ministry,  the Deputy Attorney General, the Civil Service 
Commissioner, a retired judge from the antitrust co urt and an antitrust expert from the academia. 
With regard to accountability, the decisions of th e IAA General Director are subject to judicial 
review. 
Is the IAA authorized to issue binding opinions on sectoral regulations that contravene the provisions 
of the Restrictive Trade Practices Act 5748? 
Answer: 
The Restrictive Trade Practices Act (RTPA) concern s commercial and trade practices of private 
parties, not government regulations (sectorial or other).   
How is the judicial review procedure applied in practice? WT/TPR/M/272/Add.1 
Page 44  Answer: 
In general, the RTPA provides for a right to appe al the decisions of the General Director to the 
Antitrust Tribunal (which sits within the distri ct court in Jerusalem). The Antitrust Tribunal 
reviews the General Director's decision in a de -novo like manner, meaning, it does not focus on 
legal issues only but reviews the facts of the case as well.  The antitrust court it is presented with evidence and hears testimonies. The Antitrust Cour t decisions may be appealed to Israel's Supreme 
Court. 
Page 48, paragraph 84 
Has Israel specified the type of evidence require d to prove that an Agreement is anticompetitive?  
Answer: 
No such specification was made. 
Also, has Israel specified the type  of evidence required for a potential infringer to show he has not 
incurred in this practice? 
Answer: 
No such specification was made. 
What are the limiting factors under Israel's competition laws to sanction international cartels affecting 
Israeli markets? 
Answer: 
The RTPA does not refer specifically or differently to  international cartels, as opposed to domestic 
cartels.  Limits to extra-territorial criminal en forcement are set by the general rules of public 
international law and the Israeli general Penal law.  
The General Director addressed the issue of extra-te rritorial application of the Israeli RTPA  in its 
decision concerning Restrictive Trade Practices in the Selective Perfume Market – James 
Richardson (2002), where it applied the interna tional competition law doctrine known as "The 
effects doctrine" as a basis for the application of the RTPL to foreign companies. Under the effects 
doctrine, a country can apply its domestic laws to fo reign persons or enterprises when their conduct 
has an effect within the domestic jurisdiction. 
What elements are taken into account when  prioritizing competition investigations? 
Answer: 
Considerations that are taken into account includ e the potential harm to competition, based, inter 
alia, on the status of the offender in the affected market, the duration of the violation, benefit to the 
offender and the harm that occurred, or co uld have occurred from the violation (These 
considerations are listed in Section 47A of the RT PA as aggravating factors in antitrust violations, 
and are also relevant when prioritizing investi gations). In addition, standard prosecutorial 
considerations such as the sufficiency of evidence,  and the public interest are taken into account 
when deciding on criminal procedures.   WT/TPR/M/272/Add.1 
 Page 45 
 
 
Page 49, paragraph 85 
Has Israel estimated how the exemption mechanism descr ibed distorts the efficiency of the markets in 
question? 
Answer: 
A detailed assessment of the implications of th e exemption mechanism ha s not been conducted. 
Page 49, paragraph 86 Is the IAA authorized to issue injunctions or interim measures during its investigations? 
Answer: 
No. 
Is the IAA authorized to require judicial cautions  or guarantees over potential injunctive relief in its 
investigations? 
Answer: 
The IAA lacks such judicial powers (which are reserved to the court).  
In order to determine if a company is in a domin ant position, does Israel take into account if the 
market is contestable? 
Answer: 
Market contestability is generally taken into acco unt in determining market power, including in the 
context of abuse of dominant position cases.   
What are the implications of using market threshol ds for determining if a company is in a dominant 
position? 
Answer: 
Market share thresholds are relevant in determ ining if a company holds a monopoly, which is 
defined in the RTPA as 50% or more market shar e (lower market shares can suffice under certain 
conditions). However, the prov isions concerning abuse of dominant positions by monopolies 
require a showing of market power.  Accordingly, the implications of the market share thresholds 
on findings of abuse of dominant position are not conclusive. 
Page 49, paragraph 88 Does Israel allow the merger of potentially anticompetitive operators under the "failing firm defense"? 
Has Israel implemented this exception? 
Answer: 
Yes, Israel allows for the failing firm defense in  its merger review, and the IAA has published 
guidelines on the application of this doctrine.3  The doctrine was implemented in merger reviews, 
                                                      
 3  IAA General Director's Opinion on the Failing Firm Doctrine (25.01.10).  Available (in Hebrew) at: 
http://archive.antitrust.gov.il/files/10306/The%20Failing%20Firm.pdf    WT/TPR/M/272/Add.1 
Page 46  although it has not been widely applied as a basis  for allowing mergers that would otherwise be 
prohibited. The two key cases where the doctrin e has been implemented and the defense was 
accepted are in the matter of the ClubMarket merger (2005) and the Nuriel-Hashmira merger 
(1998). 
What type of evidence is taken into account in order to prove that the benefits of economic 
efficiencies resulting from an economic integration,  effectively exceed the potential negative impact 
of the operation? 
Answer: 
As noted in the IAA's Horizontal Merger Guidelin es (2011), efficiency claims in a merger review 
need to be supported by objective information, fo und mostly in independent sources that can be 
examined by the IAA. 
What is the procedure for investigating, condition and/or sanction international concentrations with 
anticompetitive effects in Israel? What happens when  the companies affecting Israeli markets reside 
outside Israel? 
Answer: 
Subject to market share and turnover thresholds (in the domestic market), a merger between an 
Israeli and a foreign entity, or between two foreign entities, both of which have a place of business 
in Israel (including through a subsidiary, agent or office), is subject to the merger provisions of the 
RPTA and requires the submission of pre-merger notifications and the Director General's approval.  The procedures for reviewing such me rgers are similar to those which apply to mergers 
of domestic companies. 
Page 50, paragraph 89 
What kinds of elements are taken into the account  as mitigating/aggravating factors when imposing 
administrative/criminal sanctions? 
Answer: 
Paragraph 50e to the RTPA lists some of the el ements that are taken into account by the IAA 
General Director when imposing an administrative fine: A) The duration of the violation. B) The 
degree of damage to competition or to the public which occurred or could have occurred due to the 
violation. C) The role of the offender in the viol ation. D) Prior violations by the offender. E) Any 
actions taken by the offender to stop the violation,  prevent it or to repair its consequences. F) The 
offender's economic capability or a situation in witch as a result of the sanction the offender will 
have to cease his activity. The AA published guidelin es that further elaborate on the elements taken 
into consideration when imposing administrative sanctions. 
Regarding criminal procedures, paragraph 47a of th e RTPA names some of the elements that are 
taken into account as aggravating factors, which include: A) The duration and status of the offender in the market affected fr om the violation; B) The duration of the violation; C) the damage 
that occurred or could have occurred to the public from the violation, and D) the benefit that the 
offender received from the violation. 
What are IAA's main tasks relating to competition advocacy?  WT/TPR/M/272/Add.1 
 Page 47 
 
 
Answer: 
Providing input and advice to the government, oth er agencies and to the Parliament on competitive 
effects of statutes, regulations and reforms that are being considered. 
Page 50, paragraph 90 
Has Israel evaluated whether detection methods such  as eg. formal complaints, leniency program and 
assistance to whistle-blowers were more/less effec tive than proactive methods such as eg. intra-
institutional agency cooperation, government ag encies support, press monitoring and/or trade 
associations, broadcast programs of competition policy? 
Answer: 
No such evaluation has been made. 
Page 51, paragraph 91 Have you estimated how the price control mechan ism described distorts the efficiency of the 
enumerated markets? 
Answer: 
While no comprehensive analysis on the effect of price control on the operation of enumerated 
markets was conducted, the Israeli authorities note that price contro l exists in markets where full 
competition does not exist, such as monopolistic markets.  In most cases, products or services under 
price control are "basic commodities", where the public interest requires price control.  
Page 52, paragraph 93 
Has Israel determined if mechanisms for allocat ing public contracts prevent collusion between 
competitors when using enabling factors such as: joint bids without restrictions, frequency and 
fragmentation of bids, publication of bids, high reference prices,  restrictions on foreign bids? 
Answer: 
Israel implements several measures to ensure the integrity of bids in public procurement.  
Among other measures, bidders are required to sign a mandatory statement regarding non 
collusion of bids. The central procuring entity within the Ministry of Finance, in charge of 
formulating procurement policy for all government  agencies, may take such steps as freezing 
procedures, in cases of bids appearing to be abn ormally low or high and in cases where prominent 
potential bidders refrain from submitting a bid. Jo int bids generally require prior authorization 
from the procuring entity. 
TRIPS Page 57, paragraph 109 
What is the difference between the doctrine of fair dealing and fair use of intellectual property? 
Answer: 
The two systems differ in so far as under the new "fair use" system, like in US copyright law, an 
open ended list of possible uses can be consid ered, whereas under the previous "fair dealing" WT/TPR/M/272/Add.1 
Page 48  system the fairness analysis would only be applied in respect of a closed list of usage types.  
The doctrine of "fair use" in Israeli law only applies with respect to copyright. Page 62, paragraph 127  
Can transfers of copyright in Israel be free and/ or permanent? Please distinguish whether the scheme 
varies depending if the author is alive or not. 
Answer: 
Copyrights can be freely assigned, in whole or in part, by the copyright holder regardless of 
whether an author is living or deceased. Assign ments may be permanent and Israel copyright law 
does not contain any "reversion" type arrangem ents. Copyrights may also be devised by 
testamentary bequest or by operation of law. 
In the 70 years following the death of an author , does Israel protect the economic rights over an 
artistic work, as well as the moral rights over it? If not, is there a difference in the way the law 
regulates each category of rights? 
Answer: 
Moral rights for all categories of works, excep ting computer programs, are protected concurrently 
with the period of copyright protection. 
Energy:  Gas 
Page 73, paragraph 37 
With the restructuring of Oil Refineries, Ltd. in to two companies and its privatization in 2007, how 
many economic operators, companies or firms were these two companies assigned to? Were the two companies assigned to more than two economic operators? 
Answer: 
The two refineries in Israel, one located in Ashdod and the other in Haifa, were owned by a state-
owned company, Oil Refineries Ltd. After the priv atization of the company in 2007, two companies 
were awarded the tender to purchase the refineries from the State- Ashdod Oil Refinery Ltd was 
sold to Paz Oil Company Ltd, and Haifa Oil Refinery Ltd. was sold to Israel Corp. Ltd. 
Automotive 
Page 78, paragraph 52 How do you calculate the sales tax on cars? At what point is the tax generated? 
Answer: 
The purchase tax on cars is 83% upon importation.  
How do you measure the emissions of a vehicle for purposes of calculating the tax? 
Answer: 
The level of emissions are measured according to the information received by the manufacturer.  WT/TPR/M/272/Add.1 
 Page 49 
 
 
How is the infrastructure for elect ric cars promoted in the country? 
Answer: 
The State of Israel encourages the use of electr icity driven transportation in Israel, including 
electric vehicles, to facilitate change and diversity in the national fuel offering.  
Pursuant to Government Decision no. 2580 (2007) en couraging fuel-free transport, the Ministry of 
Energy promotes charging regulations for electri c vehicles that will enable open, competitive and 
safe recharging of electric vehicles and that will comply with international standards.  
The policy of the Ministry is based on several key principles, primarily preserving the safety of 
consumers and passersby during recharging, open a ccess to universal charging devices in public 
parking lots, enabling multiple suppliers market an d providing all custome rs access to recharging 
facilities. Another important principle is contro lled recharging that reduces the consumption of 
electricity at peak hours.  
The infrastructure for electric vehicles cons tructed until now includes 36 battery replacement 
stations and about 1,500 charging posts, 500 of whic h in public parking lots. Each charging post 
allows 2 vehicles to be charged simultaneously. 
Financial services 
Page 79, paragraph 57 
Regarding the degree of independence obtained by th e Central Bank of Israel through the new Bank of 
Israel Law 5770 of 2010, how is the Governor of the bank appointed? Which State authority holds the 
Governor accountable? What are the mechanisms pr ovided by the 5770 Law in order to ensure the 
independence of the Central Bank? 
Answer: 
The Governor shall be appointed by the Preside nt of the State per recommendation of the 
Government. (Section 6 of the law). The Governor sh all be appointed to a five-year term and may 
be reappointed for one term only (Section 10). 
The President of the State may, per motion of th e government, terminate the term in office of the 
Governor if he deems the Governor unfit to conti nue his term in office for one of the following 
reasons: (Section 13)  
 - committing an act unbefitting his status as Governor;  - violating the provisions of Section 11 (prohibition of additional occupation);  - permanent incapacity. 
Autonomy of the Bank: To attain  its objectives and discharge its functions, the Bank shall be 
autonomous in choosing its actions and exercising its powers (Section 5 of the law). WT/TPR/M/272/Add.1 
Page 50  Telecommunications and postal services 
Page 83, paragraph 73 
In the context of the reforms intr oduced by the Government of Israel relating to telecommunications, 
is interconnection mandatory in all cases? Are th e operators free to negotiate the interconnection 
rates? 
Answer: 
Interconnection is mandatory between providers of publicly available telecommunications networks 
and services. In Israel, interconnection rates for all suppliers are regulated (not just 
interconnection rates for suppliers with significan t market power). This is because in our view, 
termination on a supplier's network is by nature a monopolistic product, even if that supplier does 
not have significant market power. 
Page 84, paragraph 75 What are the currently applicable restrictions on foreign ownership of telecommunications services for 
domestic, international and wireless infrastructure considered essential? 
Answer: 
Domestic Fixed Line Operator:  The control of a domestic licensed communications company must 
be held by an Israeli individual or a corporation incorporated in Israel in which an Israeli 
individual holds at least a 20% interest.  
75% of the members of board of directo rs must be Israeli citizens and residents. 
Radio and Mobile Telephone Services: Local partn er required; no more than 80% of shares may be 
owned by a foreign entity. 
Majority of members of board of directors must be Israeli citizens and residents. 
International Communications Services: At least 26 % of the control in a licensee must be held by 
individuals who are citizens and residents of Israel.  
Majority of members of board of directors must be Israeli citizens and residents. 
SEPARATE CUSTOMS TERRITORY OF TAIWAN, PENGHU, KINMEN AND MATSU 
Part I:  Secretariat Report, WT/TPR/S/272 
II. Trade Policy Regime:  Framework And Objectives (1) Development And Administration Of Trade Policy Page 14, paragraph 1 
As a small country, Israel is hi ghly dependent on foreign trade as an engine for growth, innovation, 
and competition.  Israel is pursing trade liberali zation on an MFN basis through WTO negotiations, 
bilaterally through reciprocal preferential Ag reements, and unilaterally through autonomous 
initiatives.  It is seeking further multilateral libera lization in non-agricultural market access (both tariff 
and non-tariff measures), where it has a relatively open regime.  Israel is prepared to make substantial 
commitments on trade in services, subject to recipr ocal commitments by its WTO trading partners.  
Israel is exploring the possibility of concluding additional free-trade Agreements with emerging  WT/TPR/M/272/Add.1 
 Page 51 
 
 
countries in Asia and Latin America, with a view  to opening new markets for its exporters and 
diversifying its foreign trade. 
Question(s):  On the possibility of it concluding  additional free-trade Agreements with emerging 
countries in Asia, could Israel please elaborate fu rther on its plans, the anticipated timeframes and 
whether there will be any influence from previous FTAs? 
Answer: 
Israel is currently negotiating an FTA with India.  In addition, Israel has held some exploratory 
discussions with South Korea and China and expects th em to continue in the near future. Israel is 
open to explore possibilities of FTAs with other countries in Asia (and elsewhere). 
(3) Preferential Trade Agreements And Arrangements 
(i) Overview  
Page 16, paragraph 12 
Israel's network of FTAs includes some of its main trading partners (EU, United States, EFTA, 
Turkey, Canada, and Mexico), a lthough none currently covers services provisions.  Israel is 
considering expanding the scope of  its FTAs with Canada and the United States to include services.  
Since its last TPR, Israel has concluded a free-tr ade Agreement with MERCOSUR, which has entered 
into force for all signatories.  Is rael and the European Union have further liberalized their bilateral 
trade in agricultural products through a new Protocol that entered into force on 1 January 2010.  FTA 
negotiations were launched with India in May 20 10, and with Colombia in March 2012, both are 
intended to cover services.  Feasibility studies have been conducted with the Republic of Korea, and 
with Chile. 
Question(s):  In expanding the scope of its FTAs with Canada and the United States, does Israel 
expect investment to be covered along with the inclusion of services? 
Answer: 
The issue of investments was not discussed with the United States.  
Israel and Canada are exploring the possibility to include provisions on investments in the 
framework of the upgrade of their agreement. No decision has been taken thus far.   
IV. Foreign Investment Regime  
Page 19, paragraph 22 
Israel does not have a foreign investment law.  There is no special approval or screening process for 
investments by foreigners.  Establishment is gove rned by the Companies Law of 2000.  Companies 
must register with the Registrar of Companies (within a month of establishment), the Israel Tax 
Authority, and the National Insurance Institute.  Re gistration of a business in Israel takes about one 
month, or nearly three times the OECD average, according to the World Bank.  In November 2010, the Knesset approved a reform of Israel's pro cedures for obtaining a business licence (Business 
Licence Law).  The law is to ente r into force once the implementing regulations are adopted.  Business 
licences (permits) are granted by municipalities.  The renewal period varies from one to 15 years, 
according to category of business and assessment of potential risk.  Various government ministries are 
involved in establishing the licensing requirements.  Under the reform, the government ministries WT/TPR/M/272/Add.1 
Page 52  
concerned are required to establish a standardized list of requirements, in order to avoid duplication of 
requirements (with exceptions where sp ecific licensing requirements exist). 
Question(s):  Does Israel have any plans to re duce the current longer th an average business set-up 
time with a view to attracting foreign investment? 
Answer: 
The current longer than average business set up time has been  the subject of review of a high level 
inter-ministerial task-force established in 2009, led by the Ministry of Finance, with the 
participation of the business sector. Its aim is to improve doing business processes and facilitate 
bureaucratic processes in general. In the field of st arting a business, a process is being examined to 
create a Single Point of Contact which would co nsolidate and streamline the functions of four 
different authorities with which a new business must register. Given the high penetration rate of 
broadband internet access in Israel, the Co mmittee is currently examining a process whereby a 
business could be opened via the internet without the need to visit a government office. The successful completion of the reform is likely to  reduce the time required for opening a business 
from 34 days (currently needed according to the "d oing business report" of the World Bank) to less 
than one week.  
IV. Trade Policies By Sector 
(2) Energy Electricity and renewable energy 
Page 65, paragraph 41 
Israel produces only 0.4% of its electricity from re newable sources, excluding solar energy for heating 
water (corresponding to about 3% of the national u se of primary energy sources).  The government 
target is to generate 10% of elect ricity from renewable sources by 2020. 
Question(s):  What is Israel's installed capacity and what is the ratio of renewable energy to the total? 
Could Israel please provide further details of its planned targets for renewable energy by 2020? 
Answer: 
At the moment, Israel's installed capacity of con ventional electricity generation plants is around 
13,700 megawatts. The installed capacity of power generation from renewable energy sources is 
about 250 megawatts, mostly solar. It is expected  to reach 660 megawatts by the end of 2013, and 
the target is for more than 2,700 megawatts by 2020. The policy of the Ministry of Energy and Water Resources (formerly the Ministry of Nationa l Infrastructures) for the integration of 
renewable energy sources in the Israel's power generation of mix may be found at:  
http://energy.gov.il/English/PublicationsLibraryE/REPolicy.pdf 
Part II:  Government Report, WT/TPR/G/272 
III. Structural And Sectoral Reform Initiatives (1) Main Initiatives 
Page 15, paragraph 43 a.:  Increasing Competitiveness in the Economy—Shani Committee: on 
17 June 2012, the Cabinet adopted a draft law concerning increasing competitiveness in the economy. 
The draft was adopted following the submission of the final recommendations in the report by the  WT/TPR/M/272/Add.1 
 Page 53 
 
 
committee for increasing competitiv eness in the economy ("Shani Co mmittee") which was appointed 
in October 2010. The draft legislation is yet to be enacted by the Knesset, which may introduce 
changes to the proposed Law. Among other topics, the cabinet adopted the Committee's 
recommendations in respect to: 
a. Allocation of public assets (priva tizations): the relevant authorities in charge will be 
obligated to take into account considerati ons of competition in the framework of the 
allocation of resources and privatization pr oceedings. To this end, these entities will 
be obliged to consult the Antitrust Commissi oner whenever the value of the right or 
the asset is excess of NIS 150 million, or in lower values whenever the economic value of the asset does not reflect entirely its importance to the public. 
Question(s): 
When public real estate is provided to the private sector, are there any regulations or mechanisms for 
Public Private Partnership? 
Answer: 
The recommendations of the committee did not deal specifically with allocation of public real estate 
to the private sector. Rather, they seek to define the process required by the relevant governmental 
authorities when they intend to initiate privatiza tion procedures. As descri bed in the Government 
Report (WT/TPR/G/272), the concerned authoriti es will be obligated to consult with the 
Commissioner of Antitrust, to ensure that the process would not result in the creation of non 
competitive market. In addition, the authorities are required to take into account the importance of 
the "public asset" which is the subject matter of th e said privatization, to the public at large. 
IV. Technological Innovation 
(2) NewTech. 
Page 19, paragraph 58: 
With the aim of responding to increasing global e nvironmental challenges and the water shortage in 
Israel, the Government launched "Israel NewTec h" national programmes in 2006 and 2008, focused 
on water and renewable energy technologies respectiv ely. This pioneering national programme is led 
by the Ministry of Industry, Trade and Labour , and is supported by a number of additional 
government agencies. 
Question(s): What renewable energy (RE) technologies are supported by the Israel NewTech programmes?  
Answer: 
Israel NEWTech programs support all types of RE technologies without preferences regarding 
specific technologies.  
Since a major share of RE companies in Israel op erates in the solar fiel d, Israel NEWTech is 
involved substantially in this field. Nevertheless, support is also extended to such RE projects based 
on other sources, such as wind, biomass, oil alternatives and all other forms of RE which are 
relevant to the Israeli companies.    WT/TPR/M/272/Add.1 
Page 54  
What kind of projects (e.g. PV System, solar cell, wi nd power, biomass, fuel cell) are executed within 
the programmes?  
Answer: 
Israel NEWTech does not directly implement RE projects in Israel. Other governmental agencies 
are in charge of implementation of RE projects in  Israel (such as the Electricity Authority, the 
Israel Electric Corporation etc.). 
Israel NEWTech is involved in projects outside of  Israel, such as promoting the establishment of 
clusters or consortia of Israeli companies fo r operations abroad. These projects are not limited to 
certain companies and technologies. 
In terms of technological development, have these RE technologies formed a green energy industry in 
Israel? 
Answer: 
The RE technologies contributed towards the deve lopment of a green energy industry in Israel. 
Currently, there are in Israel approximately 300 co mpanies operating in this field and more 
companies are joining every year (either already es tablished companies who aim to diversify their 
portfolio or start-up companies that are operating only in the specific field of RE).  
Which are the most important RE manufacturers in Is rael in fields such as photovoltaic, wind, biomass 
and fuel cell technology? 
Answer: 
As mentioned, most of the RE companies in  Israel are operating in the solar sector.  
In the thermo solar field, one of the biggest companies is Solel.  
In the photovoltaic (PV) field, there are several medium size companies, such as BrightSource, 
Solar Edge, Bsolar and others. 
For electric vehicles (EV), the most we ll-known company is Better Place. 
For wind power, companies such as Winflex an d Pentalum are present but, there are not many 
companies operating in this field.  
Fuel cells are an interesting and developing field in  Israel, with many start-up companies that were 
established in the last few years. Among th em are Phinergy, Cellergy and others.   
(3) Intellectual Property Rights 
Page 20, paragraph 63(3): 
The following amendment is a result of an Unde rstanding between Israel and the United States 
regarding Intellectual Property Rights in pha rmaceutical products, dated 18 February 2010: 
(3) Drug data exclusivity protection legislation – An  amendment to the Israeli Pharmacists' Ordinance 
was enacted on July 2011. It extends the duration of data exclusivity from 5 to 6 years after marketing 
approval was granted in Israel, or 6.5 years (inst ead of 5.5 years) after receiving final marketing 
approval in a recognized country.  WT/TPR/M/272/Add.1 
 Page 55 
 
 
We fully understand Israel extending the duration of data exclusivity terms to comply with the 
requirements of multinational companies, especial ly those from the US.  Indeed, according to 
Article 39.3 of the WTO TRIPS Agreement, Members shall protect such data against unfair commercial use. 
Question(s): 
Before the amendment to the Isr aeli Pharmacists' Ordinance in 2 011, was any case brought in Israel 
by multinational companies on the grounds of unfair commercial use with particular reference to 
Article 39.3 of the WTO TRIPS Agreement?  
Answer: 
Not to our understanding. 
Could Israel please provide further information on  the scope of TRIPS protection given to new 
medical preparations and/or their contents? 
Answer: 
New medical preparations may be eligible for pat ent protection where the preparation contains a 
novel and non-obvious element, such as a compou nd or a means for making such a compound. In 
addition, a new medical preparation may be elig ible for TRIPS Article 39(3) type test data 
protection to the extent that such new medical p reparation contains a new chemical entity and such 
NCE required regulatory approval. 
CHINESE TAIPEI (SET 2) 
Part I:  Secretariat Report, WT/TPR/S/272 I. Economic Environment 
1. Introduction 
Page 35, paragraph 43 
As indicated in the paragraph 43 of the report WT /TPR/S/272, most imports that are subject to 
technical requirements are inspected at the port of entry while domestic products are subject to market 
inspection, since Israel applies to imports and domestic products individually with the different 
conformity assessment procedures that appear to be di stinct in trade restriction, therefore, we would 
like to solicit Israel to clarify how they comply  with the Article 5.1.1 of the TBT Agreement 
concerning national treatment.  
Answer:  
Imports subject to technical requirements are sa mpled at the port of entry and inspected for 
conformity with mandatory standards.  Those produ cts that require authorization by a competent 
authority (Ministry of Health, Ministry of Agriculture etc.) are inspected by the said body (usually a 
sample is taken) and once an appropriate certificat e is issued, the entire sh ipment can be released 
to the warehouse of the importer.  Imports that ar e released without inspection at the port, may be 
subject to the regular market  surveillance sampling and inspec tion conducted in markets and 
warehouses. Due to efficiency consid erations, generally, such double inspection is not carried out.  WT/TPR/M/272/Add.1 
Page 56  Products may be inspected after release from customs if a complaint related to the product is filed.  
Israel does not apply different conformity assess ment procedures for domestically manufactured 
products and imported products. Therefore imported products are treated no less favourably than domestic products. Inspection of domestic goods is performed by the Commissioner of 
Standardization's staff in accordance with its regular 3-year inspection and enforcement program. 
In light of the above we are of the view that Israel fully complies with the provisions of Article 5.1.1 
of the TBT Agreement. 
Trade Policies and Practices by Measure (3) Measures Affecting Protection and Trade (v) Trade-Related Aspects of Intellectual Property Rights (TRIPS) 
Pages 50, 51 and 52, paragra phs 108, 112, 115 and 117 
As indicated in paragraphs 112 and 115, Israel possesses a substantial a nd well-developed generic 
pharmaceutical industry. Also indicated in paragraphs  108 and 117 and mentione d in the Israeli trade 
policy review report (WT/TPR/G/272,  paragraph 63), Israel has am ended certain pharmaceutical IPR 
provisions that, for example, extend the period of test data protection (i.e. data exclusivity), in order to 
implement an agreement with the United States a nd to improve bilateral economic relationships 
(looking forward to a downgrade from the Special 301 Pr iority Watch List to Watch List). In theory, 
the longer the data protection period tends to be, th e more disadvantageous it will be for the generic 
pharmaceutical manufacturers. We would appreciate it if  Israel could provide us with more details on 
how to assist the said industry in their response to the extended period of data exclusivity. 
Answer: 
We believe that the agreement with the U.S. and th e legislation that follows have the right balance 
for all stakeholders. For further details on the said amendment please see:  
http://www.justice.gov.il/NR/rdonlyres/5137 8FC3-4A0C-420E-9849-B3C9DBC6B109/29421/23 
08.pdf page 1001 (Hebrew). 
Part II:  Government Report, WT/TPR/G/172 IV. Technological Innovation 
(3) Intellectual property rights 
Page 21, paragraph 64 
As indicated in paragraph 64, a new law titled "E xposing the identity of up loaders in Electronic 
Communication Network" has passed first reading in the Knesset. Please elaborate on this new law and, if possible, provide us with further information. 
Answer: 
The proposed bill will give courts  the authority to order internet service providers, and or other 
intermediaries (hereinafter collectiv ely intermediaries), to disclose id entifying information in their 
possession or control which is sufficient to en able service of process (hereinafter Identifying 
Information) upon an anonymous publisher (up-loader) of material that allegedly infringes intellectual property rights or is actionable in to rt (such as libel). The bill proposes the following 
procedures:  WT/TPR/M/272/Add.1 
 Page 57 
 
 
Step 1 - Where an entity believes that its intellect ual property rights have been violated through 
posting of material on the internet, or that such material is actionable in tort, such entity may 
motion the court for an Order requiring an int ermediary to forward to the court Identifying 
Information sufficient to enable service of pro cess upon the heretofore anonymous up-loader. The 
applicant's application must state allegations sufficien t on which to set forth a legal cause of action.  
In addition, the applicant may simultaneously make a parallel application, pursuant to Civil 
Procedure Law for an ex parte search and seizure  order of the up-loader's property in order to 
obtain and preserve evidence of an infringement or tort. [Current law provides for such search and seizure orders, however following enactment of the B ill minor adjustments will be made in the Civil 
Procedure Law to coordinate it with the Bill in the form in which it will be after enactment.] 
Step 2 – If the Court is persuaded that a possible cause of action has been made out in the 
application for discovery of Identif ying Information, and that th e application is not abusive or 
being made for unrelated purposes, then the Co urt may Order the relevant  intermediary to deliver 
to the Court such Identifying Information alon g with information in its possession and control 
about third parties who may also have such Identifying Information. 
Step 3 – Upon the Court's receipt of the aforesaid  Identifying Information the Court will forward 
the applicant's application to the alleged up-l oader for his response. Upon receipt of the 
notification from the Court the alleged up-loader may:  (1) Agree to the disclosure of his identity, in 
which case Identifying Information will be transmit ted by the Court to the applicant; or, (2) Where 
the up-loader fails to respond to the Court's notific ation, the Court will render a decision on the 
basis of documents submitted to it for consid eration; or, (3) The up-loader may elect to 
anonymously contest the application for Identifyi ng Information, however where the Court will be 
persuaded on the basis of prima facie evidence that  there is substantial likelihood for success on the 
merits, the Court will grant the application and deli ver the Identifying Information to the applicant. 
CHILE 
IV. Trade Policies by Sector 
(1) Agriculture 
(iv) Border measures 
Paragraphs 22-23 
Regarding the tariff regime applicable to agricult ural (dairy) products, for which tariff protection 
averages 109%, would Israel be in a position to re vise the amount or level of the applied tariffs? 
Answer: 
On October 23rd 2012, the Government adopted a reform in th e dairy sector to liberalize the imports 
of dairy products on a MFN basis. Recommenda tions resulting from this reform will soon be 
implemented affecting not only the applied tariffs on certain milk products but also provide market 
access opportunities for cheese, butter, yogurts and other dairy products.  WT/TPR/M/272/Add.1 
Page 58  JAPAN 
III. Trade Policy Development 
(2) Trade Policy (ii) Free Trade Agreements Question 1:  Page 56, paragraph 133 (3) Measures Affecting Production And Trade 
(v) Trade-related aspect of intellectual property rights (TRIPS) As shown in Chart III.4, the number of intell ectual-property-related seizures of imported goods 
increased significantly in 2010.  Please explain what  the government of Israel views as the cause of 
this increase.  If there is any specific type of goods which contributed to the increase in the number of 
seizures, we would like to know. 
Answer: 
The increase in the amount of seizures and su spension between the years 2009 and 2010 may be 
attributed to several reasons.  One would be the worldwide increase in trade in infringing goods.  
However, in Israel's case ther e is an additional explanation.  In the year 2009, Israeli customs 
made a number of improvements in its risk assess ment procedures.  A new unit was formed on the 
national level and changes were made in the criteria dealing with infringing goods.  
Several times a year rights holders are invited to give seminars to the field personnel on how to 
discover counterfeit goods. Over 99% of the suspensions and seizures by Israel Customs are on its own initiative, as opposed to the TRIPS procedures (prior notification by the rights holder).   
It should be noted that a similar increase wa s recorded in the year 2011 where there were over 
1,073 suspensions or seizures. 
Question 2:  Page 72, paragraph 64 
(4) Services 
(i) Financial services 
Regarding paragraph 64 on page 72 of the Secretar iat's Report which states that Israel has no deposit 
insurance scheme, Japan would like to know if there is the possibility for such a scheme to be adopted. 
Answer: 
In the past the authorities concluded that the est ablishment of a deposit insurance scheme would 
not contribute to the stability of the Israeli ban king system. The authorities will revisit this issue 
during a forthcoming review of the legal fr amework in the banking sector, as required by 
international banking supervision bodies.    WT/TPR/M/272/Add.1 
 Page 59 
 
 
ARGENTINA 
Report by the Secretariat, WT/TPR/S/272 
III. Trade policies and practices by measure 1) Measures Directly Affecting Imports iii) Other taxes and charges 
a) Internal Revenue Paragraph 20 states that, in general, domestic ta xes for imports are calculated based on the total cif 
value of the imports (including import duties), wh ile the domestic taxes for goods produced in the 
country are based on the wholesale price of the products. However, for the taxes on purchases of 
imported products, Israel uses a determination syst em known as TAMA (acronym in Hebrew for the 
expression further increase). The TAMA system tries to equalize the local wholesale prices, including 
estimates of the cost of insurance and internal frei ght, to the declared/reported value of imports (the 
coefficients used in the TAMA calculation vary  depending on the products). The TAMA system has 
an effect similar to an import surcharge. 
Could Israel elaborate on the inner-workings of th e TAMA system, as well as specify the products 
subject to it, being that the TAMA system seems to be an import surcharge that would appear to be 
inconsistent with the National Treatme nt principle under Article III GATT 1994? 
Answer: 
The TAMA is applied to a limited number of im ported goods where a purchase tax is imposed and 
is expressed in ad valorem terms rather than sp ecific duties. Currently, it is applied mainly to 
automotive spare parts and alcoholic beverages. The TAMA is scheduled to be cancelled in 2014 for 
alcoholic beverages. The purpose of TAMA is to  equate the purchase tax calculation basis for 
domestically manufactured goods an d imports. As the basis for calculation of the tax for domestic 
goods is the wholesale price (thus increasing the calculation basis) the TAMA is added to the 
import price to bring the import prices to the same level as the domestic goods. 
In light of this explanation the TAMA does not have the effect of a surcharge on imports and 
therefore is not inconsistent with the National Treatment principle. 
vii) SPS Kosher certification 
Paragraph 51 states that, under the Kosher Meat  Import Law (1994), the importation of non-kosher 
meat and meat products is prohibite d. The import ban does not apply to live animals, beef offal, milk 
or milk products. The Government allows th e domestic production, sale and consumption of 
non-kosher meat, such as beef from dairy cows. Pig farming is prohibited, except in some villages. 
Can Israel elaborate further on the import ban on non-kosher meat and meat products? 
Answer: 
The ban on imports of non- kosher meat derives fr om religious dietary practices known as Kahsrut 
identified with the Jewish tradition. One must  follow the religious rules governing the entire WT/TPR/M/272/Add.1 
Page 60  process of meat production (beginning from the slaugh tering stage) in order for the meat to fulfill 
the rules of kashrut. 
Until 1994 all meat was imported by a state trading agency with exclusion of internal parts (liver, 
hear and the like). Being a state agency it importe d only kosher meat. After the privatization of 
meat imports, religious political par ties claimed the possibility of imports of non-kosher meat would 
result in a breach of the status quo.  The maintenance of the status quo regarding religious issues is 
a basic understanding in Israel. The passing of the Kosher Meat Import Law in 1994 assured the 
maintenance of that status quo. 
How can Israel justify this import ban, especially considering that the production and sale of these 
products is not prohibited domestically? 
Answer: 
As part of the status quo policy described in the reply above, limited domestic production, sale and 
consumption of non-kosher meat continues to be a llowed as well as imports of non- kosher internal 
parts. Import restrictions on meat and meat products were included as part of Israel's market access 
schedule, stating that all commitments pertaining to HS chapters 02, 1601,1602, 1603 are subject to 
Israeli legislation concerning Kashrut of imported products.  
IV. Trade Policies By Sector  
2) Agriculture vi) Development of aid and protection 
Paragraph 8 states that about 75% of Israel's tari ff lines are bound (Table III.2). The bound rates for 
agricultural products are high in the case of agricu ltural products: the average bound rate is 73.3% and 
the maximum rate is 560% (dates). Other duties a nd charges (ODC) of all products covered by bound 
tariffs were bound at zero. More than 90% of Israel's bound tariffs are in ad valorem  terms; some 
bound tariffs are non-ad valorem, primarily fo r certain agricultural products, textiles and 
apparel/clothing, and fish and fishery products. Israel has not yet transposed the HS 1996 nomenclature in its Schedule of Concessions; this situation makes it difficult to compare its applied 
MFN tariffs, which are under the HS 2012 nomenclature. 
At the same time, paragraph 30 states that Memb ers have expressed concerns in the Committee on 
Agriculture regarding Israel's failure to fu lfill its commitment on Aggregate Measurement of 
Support (AMS) in 2008 (US$569.98 million).
4  According to the relevant authorities, this was mainly 
due to an increased domestic support price for milk (applied administered price), which was caused by 
the rising feed prices during the world food price cris is in 2008; the low fixed reference external price 
during the 1986-1988 period (US$157 pe r tonne of milk) used for calculating the price difference; and 
the shekel currency appreciation against the dollar in 2008.  Israel's AMS 2009 notification shows that 
Israel honored its total AMS commitment level.5 
Finally, paragraph 31 states that, according to th e OECD, Israel's PSE (measured as a percentage of 
gross farm revenues) decreased from 20% in 1995-97 to 12% in 2008-10, which means that 12% of 
farmers' revenues were due to s upport policies (financial support, ta riff and other border protection).6 
                                                      
 4 WTO Document G/AG/R/60, January 19, 2011. 
 5 WTO Document G/AG/N/ISR/47, March 15, 2011. 
 6 PSE:  total annual monetary transfers to farmers individually (not agriculture generally) from market 
price support, mainly through border measures but also food aid, export subsidies (calculated by the price gap 
between domestic and border price), payments to farmers, and tax/fee reductions (revenue forgone).  The 
percentage PSE is a useful indicator for comparison s over time and among countries, inter alia, because it 
eliminates the eff ect of inflation.  WT/TPR/M/272/Add.1 
 Page 61 
 
 
The decline has been partly due to  domestic reform, and partly tha nks to higher world market prices 
for agricultural commodities.  Israel's PSE level is  significantly lower than the OECD average and one 
of the lowest among all OECD members (Chart IV.1).   However, contrary to the OECD trend, the 
share of Israel's support that is potentially most tr ade-distorting remains very high (close to 90% of the 
PSE is support tied to output or input use).  Israel ha s been slow in making reforms towards less trade- 
and production-distorting measures.  
Could Israel indicate if in the near futu re, Israel would consider implementing an ad valorem  system 
for certain agriculture products that currently have  a mixed import duties regime that is complex and 
lacks the necessary transparency for exporters? 
Answer: 
Duties on most agriculture products are imposed in an ad valorem form. 0% duty is applied in most 
commodities and the use of mixed or specific import duties is limited to certain sensitive products. This policy is being reviewed periodicall y and changed when deemed necessary. 
CANADA 
Government Report, WT/TPR/G/272 
V. Israel's Trade Policy 
(5) Bilateral Trade Agreements 
Canada would appreciate more info rmation regarding Israel's appr oach towards investment trade 
policy in its bilateral Agreements. 
Why does Israel cover only post-establishment treatm ent in its investment Agreements, and not pre-
establishment? Why does Israel not include an i nvestment chapter in its free trade Agreements, 
whereas many others states are including investment considerations as part of their trade policy? 
Answer: 
Israel does not exclude the possibility of co ncluding BITs or FTAs which would cover 
pre-establishment treatment. Israel is currently exam ining this issue and will determine its position 
on a case by case basis. Until now, Israel's position has been that a BIT on its own or as part of an 
FTA would seem to be unnecessary with OECD memb ers since those countries are obligated by the 
Codes of Liberalization in the framework of the OECD.  
COLOMBIA 
Government Report, WT/TPR/G/272 I. The Israeli Economy: Recent Developments 3) Trade in Services 
In paragraph 16 of Israel's report it is stated that: "In 2009, Israel's main servi ces exports destinations 
were the United States (48% of total exports) and Europe (29%). Import of Business services from the United States and Europe was 29%, 32% respectivel y while 39% of total business services imports 
were from the rest of the world. In the business services category export of R&D and computer related services accounted for 40% and 25% respectivel y of the total business services exported." WT/TPR/M/272/Add.1 
Page 62  
Is it possible to disaggregate the countries from which Israel imports and exports its services (23% of 
services are exported to countries other than the Unit ed States and the Europ ean Union, and 39% of 
services are provided by "the rest of the world")? 
Answer: 
Israel imports 39% of its business services from a wi de variety of countries. None of the countries 
holds a share larger than 2% of the total im ported services. Additional geographical breakdown of 
the service providers includes Asia at 4.8%. Afri ca and Oceania compose approximately 1.5% 
combined. 
As with the case of imports, Israel exports 23% of its business services to a wide variety of 
countries. Only two of the countries (Switzerland an d Bermuda) hold a share larger than 2% of the 
total exported services. Additional geographical bre akdown of the service providers includes Asia at 
3.6%. Africa and Oceania compose approximately 1.6% combined. 
V. Israel's Trade Policy 6) Unilateral Trade Liberalization 
In paragraph 85 of Israel's report it is stated that: "Israel continues to pursue trade liberalization as part 
of its general economic policy.  On 1 January  a nd on 15 July 2012, as part of a more comprehensive 
package of economic steps, Israel has eliminated tariffs on more than 400 tariff lines (at HS 8-digit 
level) on many consumer goods, where the prior le vel of customs duties had been in the range 
of 6-12%. In addition, on 15 July 2012, Israel announced a schedule to reduce or eliminate duties on some food and agricultural products over a period of three years. The reductions, if completed, are 
worth around US$15 million in annual customs revenue. " 
Has Israel developed any similar unilateral trad e liberalization program for trade in services? 
Answer: 
No such program was implemented with regards to trade in services. Secretariat Report, WT/TPR/S/272 II. Trade Policy Regime: Framework And Objectives 1) Development and Administration of Trade Policy 
In paragraph 4 of the Report by the Secretariat it is  stated that: "Legislative bills may be initiated by 
the Government or individual members of the Israe li legislature (the Knesset).  They generally go 
through three readings before adoption by the Knesset.  After the first reading the bill is referred to the 
appropriate committee for discussion;  in the second, it is reviewed in plenary session;  and in the third 
reading, a final vote is taken.  The President, the Prime Minister, and the minister concerned sign the bill into law.  In the Israeli legal system, in the case of a conflict between a WTO Agreement and 
domestic law, the latter prevails, except for governme nt procurement (Chapter III(3)(iii)).  However, 
according to the President of the Israeli Supreme Court, "The State of Israel is a member of the Law of Nations.  Therefore it is imperative that Israel not be in breach of its international obligations;  so that 
where two possible explanations exist in the interp retation of a law, it is desirable to choose the 
interpretation which will bring about fulfilment of Israel's international obligation and not one which 
will result in a breach of it."   The foregoing stat ement has been quoted in Supreme Court decisions, 
by lower courts and the advisory committee in  the context of anti-dumping proceedings."  WT/TPR/M/272/Add.1 
 Page 63 
 
 
Are the WTO Agreements incorporated into Israe li domestic law? If so, what is the nature and 
hierarchy of the law/act/regulation etc. that contains them? 
Answer: 
Certain WTO Agreements have been transposed into  law, including for example, the Agreement on 
Anti Dumping, Agreement on Safeguards an d Agreement on Subsidies and Countervailing 
Measures. The laws containing the provisions of these agreements are of equal status to all other 
internal legislation.  
In case of a conflict of laws between a WTO Agreem ent and domestic legislation, why does the latter 
prevail? 
Answer: 
In case of a conflict of laws between a domestic  law and a provision of a WTO Agreement which 
has not been transposed into domestic law, the domestic legislation prevails since in accordance 
with Israel's dualistic system unless the int ernational commitment (not including customary 
international law) has been transposed into the internal law the international commitment does not 
have the force of law.  
How is this legal principle applied in practice? Ca n Israel provide specific cases where this principle 
has been applied in its legal system? 
Answer: 
In practice, the Israeli jurisprudence has affirmed that in case of a conflict between provisions of 
an international agreement where two possible interpret ations exist of the domestic law, the courts 
will choose the one which will bring about the fulfillment of the international agreement to which it 
is a party. The principle is frequently used by the Israeli courts including the Supreme Court in a 
variety of fields and cases. It ha d been used for example in cases th at dealt with criminal law, the 
right for education, labor law an d issues in matters of extradition. 
4) Foreign Investment Regime 
In paragraph 22 of the Report by the Secretariat it is stated that: "Israel does not have a foreign 
investment law.  There is no special approval or  screening process for investments by foreigners.  
Establishment is governed by the Companies Law of 2000.  Companies must register with the 
Registrar of Companies (within a month of establishm ent), the Israel Tax Authority, and the National 
Insurance Institute.  Registration of a business in Is rael takes about one month, or nearly three times 
the OECD average, according to the World Bank.   In November 2010, the Knesset approved a reform 
of Israel's procedures for obtaining a business li cense (Business Licence Law).  The law is to enter 
into force once the implementing regulations are ad opted.  Business licences (permits) are granted by 
municipalities.  The renewal period varies from one to  15 years, according to category of business and 
assessment of potential risk.  Various government mi nistries are involved in establishing the licensing 
requirements.  Under the reform, the government ministries concerned are required to establish a 
standardized list of requirements, in order to a void duplication of requirements (with exceptions where 
specific licensing requirements exist)." 
While it is mentioned that "Under the reform, the government ministries concerned are required to 
establish a standardized list of requirements, in or der to avoid duplication of requirements," Colombia 
would appreciate a detailed e xplanation regarding other reformed procedures under the Business 
Licence Law. WT/TPR/M/272/Add.1 
Page 64  Answer: 
The following are additional procedures resulting from the reform under the Business License 
Law: 
 - "Green Track" procedure has been established enabling a shortened process for 
low risk businesses as pertains to hea lth, environmental, security, sanitary and 
phytosanitary considerations. In those ca ses if after 21 days following receipt of the 
application no reply is given by the authorities, the applicant may submit an 
affidavit containing facts pertaining to the business, after which a license shall be granted within 7 days. 
 - The right to submit a challenge by an applicant for a rejected request has been 
granted. 
 - The standardized list of requirements a llows for full transparency for applicants 
regarding the necessary approvals required. 
Colombia would also like to know when this  law is expected to come into force. 
Answer: 
The law will come into force one year following the publication of regulations (procedures) and an 
order (requirements for categories of businesses)  promulgated under the law. The regulations and 
order will be published shortly. 
In paragraph 24 of the Report by the Secretariat it is stated that: "Within the Ministry of Industry, 
Trade and Labor, "Invest in Israel" is the Govern ment's investment promotion centre for foreign 
investors.  Various tax and non-tax incentives are available for research and development (R&D), 
including grants to launch joint R&D projects with Israeli entrepreneurs, or to encourage foreign 
multinational companies to establish financial R&D centers in Israel (Table AIII.3)." 
This paragraph states that "Various tax and non -tax incentives are available for research and 
development (R&D)." Colombia would like to know  the nature of the tax incentives mentioned, as 
well as an explanation of any other incen tives to encourage foreign investment. 
Answer: 
The Office of the Chief Scientist at the Ministry  of Industry, Trade and Labor is the government 
entity in charge of supporting hi-tech firms. Most R&D incentives are in the form of direct grants, repaid when and if the product which is the result of the R&D project, generates revenues. This is done through more than 30 pr ograms focused on all the R&D spectrum - from 
a single entrepreneur to consortia of firms and academia. 
III. Trade Policies And Practices By Measure 
3) Measures Affecting Production and Trade 
ii) Competition policy and price controls 
In paragraph 86 of the Report by the Secretariat it is  stated that: "Under Israeli law, the abuse of a 
dominant position by a monopoly may constitute a criminal  offence.  The Genera l Director of the IAA 
has the authority to declare a company a monopoly in the Official Gaze tte, if the company supplies or 
purchases more than 50% of a product's or service's output in the domestic market (Section 26);  
monopsonists are thus covered.  The official lis t currently comprises 68 monopolies of goods and  WT/TPR/M/272/Add.1 
 Page 65 
 
 
services.  Instruments for regulating monopolies incl ude price controls (see below);  prohibitions of 
certain conduct, such as abusive pricing;  instruc tions by the IAA of measures to be taken by the 
monopolist to prevent prejudice to competition;  or break-up of a monopoly by order of the Antitrust Tribunal." 
This paragraph states that "The official list currently comprises 68 monopolies of goods and services." 
Colombia would like a detailed explanation of  the sectors affected by these monopolies. 
Answer: 
Monopolies have declared, inter alia, in the following  sectors (the full list is available, on the IAA 
web site (in Hebrew)): 
 - Treatment of hazardous waste  
 - Passenger flights to Johannesburg,  Hong Kong, Bangkok and Bombay 
 - Milk and dairy products  - Coca-Cola flavored beverages  
 - Electric power supply, transmission, distribution, backup services etc. various 
sectors of public transportation 
 - Providing sweeping use licenses for transmission of musical sound records 
 - Providing sweeping use licenses for th e public performance of musical sound 
records  
 - Portland cement  - Cement transportation  - Anti-theft location systems for vehicles in Israel 
 - Telephone, network access, communication infrastructure, etc.  
 - Air transport cargo terminals  - Fertilizers and chemicals  - Petroleum refineries  - Soy-based vegetarian meat substitute 
 - Chocolate, Instant coffee and Co coa powder for domestic consumption 
 - Salt 
‐ Paint 
‐ Yeast 
‐ Beer 
‐ Handling of liquid chemicals. 
iv) State-trading and state-owned enterprises In paragraph 102 of the Report by the Secretariat it is  stated that: "State-owned  enterprises continue to 
play an important role in the economy, notably in the electricity, water, transport, ports and defence 
industries.  There were 92 state-owned companie s (government companies) in 2011, contributing 
about 7% to GDP, and NIS 14.7 billion in mainly  defence-related export revenues.  State-owned 
enterprises include 2 companies that have been declared as monopolies under the Competition Law. " 
This paragraph states that "State-owned enterprises include 2 companies that have been declared as 
monopolies under the Competition Law." Colombia would like to know what are the two state 
enterprises and the sectors in which they operate. 
Answer: 
The two companies concerned are: 
1. IEC, Israel Electric Corporation WT/TPR/M/272/Add.1 
Page 66  
2. Environmental Services Company. 
III. Trade Policies And Practices By Measure 2) Measures Directly Affecting Exports 
vi) Free zones In paragraph 68 of the Report by the Secretariat it is stated that: "The city of Eilat on Israel's Red Sea 
coast is a free port.  The Eilat Free Trade Zone La w of 1985 aimed to encourage the development of 
the city of Eilat, especially tourism (Chapter IV(4)(iv)).
7  Enterprises are exempt from import duties.  
The Law provides for tax concessions and other bene fits.  Most products purchased in Eilat and 
selected services are exempt from VAT.8  Enforcement measures against leakage are carried out by 
the Border and Customs Unit.  Employers that are re sidents of Eilat are eligible for tax refunds of up 
to 20% of gross wages paid to employees working in Eilat, subject to a ceiling." 
Regarding Services, the Free Zones only specifically benefit tourist services, while other services have 
to be related to the production of goods. Is this correct? 
Answer: 
Most products and services purchased in Eilat are exempt from VAT. 
INDIA 
Part I:  Secretariat Report, WT/TPR/S/272 
Page 66, paragrahs 46-47 
Israel had modified its existing framework in re lation to its incentive structure in 2011 to shift 
assistance from high-tech companies in central Israel to the periphery.  
Could Israel elaborate on the changes made to the Law on Encouragement of Capital Investment 
in 2011 and the different incentives schemes availa ble under it? What are the criteria for benefiting 
from such schemes? 
Answer: 
Changes: 
- The tax incentives and the grants can be combined.  
- Tax rates have been reduced and are applie d not only on income derived from the 
investment but to the full income of the company. 
- There are specific benefits to special preferred enterprise. 
- Mining activity is no longer entitled to benefits.  
- Grants can be given only in priority area A.  
Criteria: 
- The company is an industrial enterprise.  
                                                      
 7 Airport-related activities at Ovda are covered by the Eilat Free Trade Zone. 
 8 Including services such as installation, operation,  maintenance, or repair of lifts, air conditioning 
systems, industrial refrigerators, automatic data processi ng machines, or vehicles;  dental technical services;  
architectural services for hotels;  management servi ces for hotels (bookkeeping, accounting, tax consultancy, 
legal services, advertising, registration of real es tate, financial consultancy, marketing of hotels).  WT/TPR/M/272/Add.1 
 Page 67 
 
 
- The enterprise meets the standards of competitiveness are according to the law. 
- For grants - the enterprise is located in priority area A.  
- For grants - the enterprise meets the stan dards determined by the administration of 
the Investments Center, inter alia preferen ce to SME's, preference to enterprises 
which located in long distances from th e center of the country, preference to 
enterprises which located in poor socio-eco nomic areas, preference to enterprises 
who pay higher average salaries, preference to enterprises who employ more employers, preference to enterprises wh o employ more employees from populations 
with low participation rates in the labor market. 
Page 71, paragraph 62 There are no restrictions on the establishment (through local incorporation) of banks or on their 
acquisition by foreign residents, provided pruden tial requirements by the Supervisor of Banks on 
ownership and management are respected. 
Israel is requested to provide details of prude ntial requirements by the Supervisor of Banks on 
ownership. The attached footnote provides details of prudential requirements  only on management and 
not on ownership. 
Answer: 
The control of a banking corporation or a ban k holding corporation requires a permit from the 
Governor of the Bank of Israel as stated in paragraph 34 of the Banking (Licensing) Law, 5751-1981. The requirement to obtain the abovementioned p ermit, in accordance with the definitions in 
the law for of the terms "bank holding corpora tion", "holding" or "acquisition", "together with 
others" and "control", therefore applies to the full holdings chain, up to the first controlling 
shareholder in the entire chain. 
Among the considerations of the Governor with re spect to the suitability of the applicant for the 
aforementioned permit are the following four important criteria: 
- Personal and business probity and integrity; 
- Financial strength; 
- Investment strategy; - Business experience, other enterprises and types of business activity of the 
applicant, and the potential for conflicts of interest in the banking corporation. 
The permit also includes various conditions, includ ing the existence of a fixed and stable control 
interest, the manner in which the means of control are held and various restrictions on the permit 
holder. In addition, to the standard and generally  applicable conditions, special conditions may also 
apply in each specific case, in accor dance with its unique characteristics. 
The Bank of Israel retains discretion regarding th e implementation of the various criteria, when 
examining various applications for control of banki ng corporations, taking into account the unique 
circumstances of each application. 
These criteria were published on Bank of Israel website. Page 72, paragraph 68 
In future, insurance companies will be required to comply with a risk-based capital standard based on 
the "Solvency II" directive principles of the EU.   WT/TPR/M/272/Add.1 
Page 68  
Could Israel specify the time frame and key elemen ts of this risk-based capital standard system? 
Answer: 
Delay of the vote on amendments  to the Solvency II Directive (Omn ibus II) gave rise to concerns 
that implementation of the Directive in Europe will be significantly delayed.  This creates 
considerable uncertainty regarding further implementation  of the Directive in Israel, and the 
CMISD (the regulator within the ministry of  finance) intends to develop a risk-based  solvency 
regime in the spirit of Solvency II, and to promote a business  culture in which the decision-making 
process is mindful of risk management  and capital allocation. The Divi sion has therefore decided to 
continue  to formulate a solvency regime for Israel's insurance companies ("Israel's  Solvency 
Regime", which will be independ ent of progress on this process  in Europe, but will be based on the 
principles of the Directive, with the  relevant adjustments for Israel and which makes use of the 
knowledge and  methodologies of other supervisory  regimes elsewhere in the world . 
Following is a list of the measures planned  by the Division for implem entation of Israel's Solvency 
Regime: 
1. Adapting  a regulatory framework   
2. Second  submittal of QIS (Quantitative Impact Study)  
3. Report  on solvency according to IQIS  
4. Own  Risk   &Solvency Assessment (ORSA)  
5. Ranking  of supervisory intervention on the basis of existing regulations   
6. Capital  Regulations on the basis of IQIS (Israeli QIS) and the application of capital  
requirements. 
Page 78, paragraph 88 To fly the Israeli flag, a vessel is required to be at least 50% owned by an Israeli entity. However, 
exemptions are allowed. 
Could Israel provide details about the exemptions allowed and if there exists any condition on such 
exemptions? 
Answer: 
According to Section 2 (a) of the Israeli Shipping  Law (Vessels) – 1960, "a vessel that more than 
half of it is owned by the State or by an Israeli citizen or by Israeli corporation, is eligible for 
registration." 
The Law contains the following exceptions: Section 2 (b) of the Law provides that notwithstanding  the provisions of subsection (a), the Minister 
of Transport is entitled to inform the Registrar th at a vessel is not eligible for registration, under 
special circumstances. 
The Minister is entitled to determine that suffici ent linkage between the vessel and Israel does no 
longer exist or conditions of the permit a re not met, and may cancel the permit. 
In the absence of compliance with the requirements set by the Law, the Minister of Transport can 
allow vessel registration subject to being convince d that there is a sufficient linkage between the 
vessel to Israel. Such a linkage to Israel may exist if the vessel is controlled and operated by an 
Israeli entity.  
The Minister may condition the registration with  other requirements, at his discretion.   WT/TPR/M/272/Add.1 
 Page 69 
 
 
Page 80, paragraph 98 
This paragraph talks about various incentives and gran ts given to tourism sector in Israel, such as, 
20% grant for investments in the priority region in  the periphery, grant of 10% for the establishment 
of tourist attractions in the priority area, etc. 
Could Israel specify whether various grants and in centives mentioned in this  paragraph are available 
only to the domestic services suppliers or they are also available to foreign service suppliers? 
Answer: 
Suppliers with foreign capital who invest in Israel's  tourism sector enjoy the same treatment as 
local companies and in certain cases even enjoy preferable treatment. 
Foreign investors may be exempt from tender requi rements for the allocation  of land for tourism 
purposes. This exemption requires special authoriz ation from the relevant ministers (finance and 
tourism). 
Page 45, paragraph 93 
It has been stated that Israel is a Member of the GPA and total Government Procurement including 
defence is almost USD 25 billion annually. 
Israel may like to provide information on how much  of non-defence Government Procurement is from 
GPA Members and from non-GPA countries. 
Answer: 
Israel is currently working on collec ting government procurement statistics. 
Page 52, paragraph 117 
It has been stated that Israel has instituted a data exclusivity re gime for test data on pharmaceutical 
firms since April 2005. 
Israel is requested to share details of review, if any, of the working of this law in the intervening 
period since then. 
Answer: 
There was no such review. 
Page 36, paragragh 48 Israel has 185 food standards, including 160 mandatory  standards, of which 20 are equivalent to 
international, regional, and othe r foreign standards (Table III.9). The Government aims to harmonize 
all of Israel's mandatory food standards with overseas norms, by 31 December 2013. 
Israel is requested to clarify as to why there has been low level of  equivalence with international 
standards in the food standards. Given the sen sitivities around food product standards, can Israel 
provide details, if any, of a road map on how it proposes achieve this by 31 December 2013?   WT/TPR/M/272/Add.1 
Page 70  Answer: 
The majority of Israel's food standards are not equiva lent to international standards.  In general, in 
most countries control of food quality is maintained  through regulation, e.g.  through Directives in 
the European Union or regulations of the United States government.  The Codex Alimentarius maintains a series of internationally accepted food standards.  Existing food standards in Israel are 
national but they are based on the three groups mentioned above.  In 2012 Israel developed a 
national program to revise and update its food st andards.  The main principles of the program 
include: 
 - Merging of individual standards to grou ps of standards.  For example, the four 
existing individual standards for fish preserve s, will be merged into a single general 
standard.  According to the program, the total number of food standards will 
decline from 160 to 130. 
 - Annually, beginning in 2012, 50 standar ds will be reviewed.  Thus, by the end 
of 2014 all of the existing food standards will have been updated.   
 - In those cases that the Technical Comm ittees (TCs) of the SII see fit, increasing 
numbers of international food standards, such  as those of the Codex Alimentarius, 
will be adopted.   
 - The program calls for an increase  of the number and length of sessions devoted to 
food by the Technical Committees as well as using more  specialists participating in 
the TCs. 
 - Increasing the number of SII specialists heading food projects, including the hiring 
of external experts to prepare technical background material for meetings of the 
TCs. 
Part II:  Other questions 
It is observed that business services constitute 45 % of Israel's service imports and transportation 
services constitute another 32% of Israel's imports from the world in 2010.  Could Israel provide 
details of business services and transportation services imported in 2010?  Which are the major 
services imported by Israel from the World? 
Answer: 
Business services imported to Israel include a va riety of services, each contributing but a small 
fraction to the total. Notable services include services between related enterprises, research and 
development, royalties and licenses fees, advertisin g, market research and public opinion polling 
and computer and related services. 
Transportation services include passenger fares, imported cargos, charter hires, port services and 
additional related services. 
It is noted that the services sector in Israel acc ounted for about 30.1% of the total goods and services 
exported by Israel to the world in 2010.  Furthe r, it is observed that business services constitute 63%, 
tourism constitutes 20% and transpor tation constitutes another 17% of Israel's total exports in the 
service sector to the World. Could Israel provide th e details of the type of services exported by them 
under head the business service, tourism and transportation service?    WT/TPR/M/272/Add.1 
 Page 71 
 
 
Answer: 
Israel exports a variety of business services, mo st notably are research and development and 
computer and related services. Other services exported include services between related enterprises, 
architectural, engineering and other technical services, royalties and licenses fees and financial 
services. 
Tourism is divided amongst business travel (i ncluding the expenditure by seasonal and border 
workers) and personal travel.  
Transportation services exported by Israel include freight services and passenger fares. 
Could Israel provide details of its Mutual Recogn ition Agreements with the European Unit in respect 
of Pharmaceuticals and with Canada in the field of Telecom? 
Answer: 
The ACAA is a new Protocol of the Association Agreement between Israel and the EU regarding 
recognition of conformity assessment results. The ma in text of the Protocol creates a framework 
agreement which allows for additional annexes accord ing to industrial sectors, to be added in the 
future. The first Annex to the Protocol deals w ith recognition of conformity assessment in GMP for 
pharmaceuticals. This Annex enables the competent authorities from both sides to accept the GMP 
approvals and certificates issued by the authoriti es of the other party. In addition, the Agreement 
exempts the batch release from requirements of both sides. The basis for an ACAA is the approximation of the relevant regulations between the parties. 
The ACAA was ratified by the European Parliament on October 23, 2012 and will enter into force 
in the coming months . 
India is invited to learn more at this site: 
http://eur-lex.europa.eu/JOHtml .do?uri=OJ:L:2010:145:SOM:EN:HTML 
The Agreement with Canada is not published yet . It sets rules and procedures for mutual 
recognition of conformity assessment of te lecommunication equipment as follows:  
‐ in the first phase, a party accepts the ot her party's test results of conformity 
assessment of equipment to the party 's relevant technical regulations  
‐ in the second phase, a party accepts the other party's equipment certifications of 
conformity assessment of equipment to th e party's relevant technical regulations. 
The move from the first to the second stage  requires a joint decision of the parties to 
do so.  
Israel has entered into FTAs with the European Union in 1975, with the USA in 1985, with EFTA 
in 1993, with Canada in 1996, Turkey in 1997, Mexico in 2000 and MERCOSUR in 2007.  Could Israel provide information on Tariff liberalization under these FTAs, preferably in excel format. 
Answer: 
Under all the agreements mentioned above, with on e exception, all industrial products are duty 
free. Agricultural products (HS ch. 1-24 ) are cover ed through positive listings of the products and 
the preference granted. WT/TPR/M/272/Add.1 
Page 72  The exception is MERCUSUR were there are schedul es for gradual reduction on some industrial 
products.   
India is invited to visit our web site  to learn more : http://www.trade.gov.il 
Israel's customs web site details the preferential t reatment granted by Israel : http://customs.gov.il 
It is observed that the average tariff rates imposed by Israel on agriculture products are higher that the 
tariff imposed on industrial products. This seems so mewhat odd in the context that Israel is a net 
importer of agricultural products. Israel may like to share the reasons for higher agricultural tariffs 
imposed by them. 
Answer: 
Israel is indeed a net food importing country. The applied duties for commodities and agricultural 
products not produced in Israel are either zero or lower than some industrial products.  
Israel imports all its grains, sugar, rice, most of its fish supply and frozen meat duty free. The tariffs 
in place are used to protect sensitive products pr oduced and grown in Israel, mostly in rural and 
remote areas.  
Being a small country located in a sensitive environm ent, farms in Israel produce more than just 
food and fiber. Farmers and farm communities in  Israel are scattered in  peripheral areas and 
along the borders playing a vital role in the livelihood of these areas, contributing to the 
government policy to spread the population away fr om the densely populated areas in the center. 
From 15th July 2012 Israel has announced a schedule to  reduce or eliminate duties on some food and 
agricultural products over a period of three years.  Is rael is requested to share the details of this 
scheme. 
Answer: 
The scheme has the following scope: 
- Reduction of tariff rates on domestic ma nufactured products with relatively high 
rates, including fresh beef, lamb, fresh and frozen meats and juices. 
- Immediate reduction of tariff rates on va rious fresh food products where there is no 
domestic production. For example, various  kinds of fish, kinds of flowers, spices, 
nuts, different kinds of dried fruits, different types  of seeds, kinds of mushrooms, 
kinds of jams, etc. 
- Differential reduction of tariff rates du ring the three years period on various 
industrial processed food products, including raw materials for domestic industry and some finished products to the fina l consumer. Examples include starch of 
different fish preserves, halva, candy, cookies, ice cream, baking powder, bulgur, 
buckwheat etc.  
It is learnt that Israeli Govt. is imposing purchase taxes on imports.  Could Israel elaborate on the 
rationale of this measure and whether it is WTO compliant? 
Answer: 
Purchase tax is imposed for fiscal reasons on dom estic produced goods as we ll as on imports and 
therefore is WTO compliant.  WT/TPR/M/272/Add.1 
 Page 73 
 
 
Could Israel provide details (HS Code wise) of it ems which are subject to tariff quotas, items which 
are subject to import licensing, and ite ms which require issue of permits.  
Answer: 
Israel has recently submitted updated notifications  under Articles 1.4, 8.2 and 7.3 of the Import 
Licensing Agreement. As indicated in those notifications – detailed list of products by HS code 
which require an import license or permit was attach ed to the unofficial translation of the Free 
Import Ordinance 2012, which was submitted to the Secretariat. 
Details of products under TRQ appear in the Secretariat report, document WT/TPR/S/272 
(page 102, Table AIV.1). 
Israel is requested to explain the rationale behind Kosher certification. Which products are subject to 
this procedure? India is concerned about Kosher cer tification, as it is proving to be expensive for the 
companies and it involves detailed inspections. Israel is  requested to inform if similar requirements are 
insisted by Israel in its FTAs with EU /EFTA/US, etc. 
Answer: 
The kosher certification confirms the kashrut of meat and meat products which is derived from 
religious dietary practices identified with the Je wish people. One must follow the religious rules 
governing the entire process of meat production (beg inning from the slaughtering stage) in order 
for the meat to fulfill the rules of kashrut. The  import requirements for kosher certification pertain 
to meat and meat products.  
The requirements apply to imports from all sources including all FTA partners. 
Israel is requested to inform the main component s of its Qualified Industrial Zone (QIZ) initiative 
under the Israel-US FTA, wherein Israel has concl uded Agreements with Jordan (1997) and Egypt 
(2004), which has led to enhanced bilateral trade and stability in the region. 
Answer: 
The QIZ protocol is based on the Israel-US FTA. The protocol allows companies manufacturing in 
Jordan and Egypt within Qualifying Industrial Zon es (QIZ) to export duty free to the US if they use 
8% and 10.5% Israeli components respectively. 
The exported goods from Jor dan and Egypt to the US must co mply with the Israel-US rules of 
origin, namely: 35% local content and substantial transformation. 
As a result of the full implementation of the FTA between Jordan and US in 2010, the volume of 
Jordanian exports through the QIZ mechanism has b een reduced substantially. At the same time 
the QIZ with Egypt has been continuously cont ributing to the bilateral trade between the two 
countries. 
BRAZIL 
III. Trade Policies And Practices By Measure Page 40, paragraph 72 
For decades Israel has encouraged investments in its industry through the Law of Encouragement of 
Capital Investment. According to Israeli Gove rnment, the "ECIL program" has the purpose to WT/TPR/M/272/Add.1 
Page 74  
strengthen the industrial capability of the country given special incentives to  enterprises located in 
disadvantaged regions, such as the magnesium industry. 
Questions: May the State of Israel explain in detail the grants under this program? 
Answer: 
The Law of Encouragement of Capital Investment allows grants of 20% of capital investments. 
What are the requirements to be met in order to receive the grant? Is it designed specifically to 
exporting industries? Specifically to the magnesium i ndustry, what category of grants are actually in 
force under the ECIL program? 
Answer: 
The requirements are that the enterprise will be an Industrial enterprise, that it will be located in 
priority area A and that it will meet the standards of competitiveness set by the law.  
There are no specific demands with rel ation to the magnesium industry. 
For how long will the grants last? 
Answer: 
The grants are given in two stages: first, during the investment period and then when the company 
has completed its obligations acco rding to its business plan and on condition that the enterprise 
continue to be opera tional for seven years.  
Page 41, paragraph 79 
Israel has granted benefits for Research & Deve lopment under Law of Encouragement of Industrial 
Research and Development ("EIRD") since 1984 . The Israeli magnesium industry has received 
incentives for R&D since it was a state enterp rise until it became a private company. 
Questions 
May the State of Israel explain in detail the grants under this program? What are the requirements to be met in order to receive the grant? For how long will the grants last? 
Answer: 
In recent years the main R&D incentive program, directed toward the Magnesium industry was the 
consortium program, operating under the MAGNET administration. 
The MAGNET administration runs several programs, all of which aim to bridge the gap between 
basic academic research and industrial R&D. No  royalty payments are mandated for PROGRAMS 
under the MAGNET administration.  
MAGNET Consortia program supports the formation of  consortia made up of industrial companies 
and academic institutions, in order to jointly d evelop generic, pre-competitive technologies. The  WT/TPR/M/272/Add.1 
 Page 75 
 
 
duration of a MAGNET Consortium is 3-5 years. Gr ants are up to 66% of the approved budget for 
industry and up to 80% for academic institutions. 
EL SALVADOR  
1) Measures directly affecting imports 
Customs procedures and trade facilitation 
Could Israel provide more information on the type of import permits that allow access to the single 
window electronic process? We would appreciate if Israel could provide information on any other 
additional services provided through this platform. 
Could Israel provide further information on the requi rements to be considered an authorized economic 
operator (AEO)? 
Answer:  
The following import permits are accessible th rough the single window electronic process: 
Standards Institute permits, Ministry of Industry license, Ministry of Transport license. There are no other services that are provided through this platform. 
Economic operators complying, inter alia, with th e following criteria may apply for AEO status:  
compliance with the customs laws and regula tions, compliance with bookkeeping regulations, 
appropriate security and safety standards at their facilities, including, the physical security of the 
facilities (only authorized persons  have access, security of storage  facilities), security of their 
records and electronic data and computer system an d reliable business partners in the supply chain 
(customs agents, transporters, etc.)  
A team of experts from Israel Customs visits the facilities conducts an inspection tour in order to 
verify if the economic operator complies with th e relevant criteria.  In addition, subsequent 
inspections may be undertaken after the economic op erator has been granted AEO status in order 
to ensure that he is still in compliance therewith. 
2) Measures Directly Affecting Exports Export subsidies, and duty and tax concessions 
Question: Could Israel provide up-to-date information on the status of the review carried out in order 
to determine the exporter's right to "…drawbacks with respect to anti-dumping duties, purchase tax, 
and customs duties when importing raw materials that  are used for manufacturing products for export, 
or when purchasing local raw materials for expor t or use in manufactured products that are 
exported."? Could Israel provide additional info rmation relating to the purpose of this review? 
Answer: 
The purpose of the review was to evaluate th e legal framework which applies to the drawback 
mechanism since the legislation applied by th e customs predated the Trade Levies Law - 1991. 
Currently, the customs authority does not apply drawbacks to trade levies including, anti-dumping 
duties, imposed in accordance with the Trade Levies Law.  WT/TPR/M/272/Add.1 
Page 76  THAILAND 
Secretariat Report, WT/TPR/S/272 
III. Trade Policies And Practices By Measures Page 27, paragraph 20 
"In general, internal taxes are levied on the duty-in clusive c.i.f. value of imports, or on the wholesale 
price of locally produced goods.  However, for the imposition of purchase taxes on imported products, 
Israel uses an assessment called TAMA (the Hebrew  acronym for additional rate of increase).  The 
TAMA approximates local wholesale prices by adding  estimated profits, insurance, and inland freight 
to the declared value of imports (coefficients fo r calculating the TAMA vary from product to product).  
The effect of the TAMA is similar to an import surcharge." 
According to the Report, purchase taxes on importe d products are now imposed.  Does the Israeli 
Government plan to reduce such taxes or transf orm to use customs duties? Also, indicated in 
Table III.7 of the Secretariat Report in 2005 (WT/TPR/S/157), purchase tax rates were between 5-120%.  What is the range of current purchase tax rates? 
Answer: 
The TAMA is applied to a limited number of im ported goods where a purchase tax is imposed and 
is expressed in ad valorem terms rather than sp ecific duties. Currently, it is applied mainly to 
automotive spare parts and alcoholic beverages. The TAMA is scheduled to be cancelled in 2014 for 
alcoholic beverages. The range of current purchase tax is 12% to maximum of 83%. 
Page 37, paragraph 55 
"Israel's phytosanitary legislation for plant imports has been revised and, according to the authorities, 
virtually all standards have been  aligned with the International Standards on Phytosanitary Measures 
(ISPM) of the International Plant Protection Convention (IPPC).  The new Plant Protection 
Regulations, in force since June 2009, improve the tr ansparency of import requirements.  Some of the 
main changes are in the area of licensing, whereby a long list of plants and plant products has been 
exempted from import permit requirements.  Import permits for non-listed plan ts and plant products 
require, inter alia, a pest risk assessment by PPIS.  As part of the revised phytosanitary measures, 
Israel has implemented the international standa rd for wood packaging materials (ISPM 15) since 
October 2009.  A pending amendment of the Plant Protection Regulations would allow for emergency 
measures." 
Could Israel elaborate on the procedure for importa tion of agricultural products?  Please explain the 
criteria of different products in substance how Israel grants permits for imports under the SPS 
obligations? 
Answer: 
Israel has included most of plant and plants pr oducts imported before the implementation of the 
new regulation in annexes to the regulations, with the relevant requirements. All those products are 
exempted from import permits. 
For non listed plants or plant products, pest ri sk analysis is required before granting an import 
permit. The import requirements are listed in th e import permit. The requirements for those 
products will be included in the annexes of th e regulations in the ne arest amendment. Once 
included, they will be exempt from import permits.  WT/TPR/M/272/Add.1 
 Page 77 
 
 
ECUADOR 
In accordance with Chapter 1, Section 4) "Foreign In vestment", page 22, para graph 22, it is mentioned 
that Israel has no FDI law, and therefore, the investments made by foreigners are not subject to a review process or a prior approval. Could you expl ain how Israel regulates foreign investment without 
the existence of a specific law? 
Answer: 
As explained Israel does not have specific legi slation mandating a general screening /prior 
approval process for all foreign investments. 
Israel does maintain general laws which while not discriminating between domestic and foreign 
investors may be used in relevant situations wh ere certain activities rela ted to national security 
issues arise. 
In accordance with Chapter 3, Section 1) "Me asures Directly Affecting Imports", page 34, 
paragraph 30, it is stated that in 2006, the Committees on Anti-Dumping Practices and on Subsidies 
and Countervailing Measures reviewed the Trade Levi es Law; however, the reviewed provisions have 
not been approved yet. Can Israel indicat e when these provisions will be approved? 
Answer: 
Israel's experience thus far in implementing the provisions of the Trade Levies Law has shown that 
there is no need at this point to promulgate im plementing provisions and therefore none have been 
prepared. 
Chapter 3, Section 1.4, paragraph 32, page 35 states that "Israel applies a mandatory lesser duty rule in 
respect of final anti-dumping and countervailing me asures; where the Commissioner or the Advisory 
Committee finds that a duty less than  the margin of dumping or rate of  subsidization is sufficient to 
prevent material injury to the domestic industry, the lower rate is to be applied. The rule has been 
applied to all measures imposed during the period  under review.  Further, under Israeli law, the 
imposition of anti-dumping and countervailing duties is permissive, and in deciding whether to levy a 
duty, the Minister must take into account, inter a lia, the trade relationship be tween Israel and foreign 
countries and reasons pertaining to the economy in ge neral. For example, the Minister of Finance 
determined that it was not in the public inte rest to impose a duty in the case of recycled 
containerboards." Could Israel explain if the Minister  of Finance is the only one authorized to evaluate 
and determine the public interest or is there a possi bility for a determination by an authority composed 
of several members?  
Answer: 
The public interest is actually considered by sev eral authorities participating in the anti -dumping 
procedures: 
 - In accordance with the Trade Levies Law - 1991  the Minister of Industry, Trade 
and Labor in adopting a decision on whether or not to the impose antidumping and countervailing duties  takes into account, in ter alia, factors pertaining to the 
"economy in general" or in ot her words the public interest.  
 - The Advisory Committee, established under the law, which submits its 
recommendations to the Minister of Indu stry, Trade and Labor concerning the 
imposition of duties, is comprised of represen tatives from the public sector as well WT/TPR/M/272/Add.1 
Page 78  
as from other ministries and so this Committee, in fact, also addresses issues 
concerning the public interest.  
 - In an amendment of 2011 to the Trade Levies Law, the Commissioner of Trade 
Levies when determining whether to impo se provisional measures is required to 
consider the injury likely to be caused to ot her sectors in Israel as a result of the 
imposition of such provisional measures. 
Chapter 3, Section 1) "Measures Directly Affecting Imports", page 39, paragr aph 42, alludes to the 
limited market access mainly due to the lack of  international standards and the difficulty of 
harmonizing Israeli standards. In this context, can Israel explain how it facilitates the standardization 
process so as to not constitute a trade barrier? 
Answer: 
For a number of years Israel has been pursuing a po licy of adoption of international standards and 
at present 80% of the country's mandatory stan dards are adoptions of those international 
standards. This results in harmonization. 
Over the next three years, there is an intent to concentrate on food standards which to a large 
extent are locally formulated standards Of course,  Israel also follows changes introduced through 
the Codex Alimentarius and they too will contri bute to the harmonization of mandatory food 
standards. 
Chapter 3, Section 3) "Measures Affecting Production and Trade ", page 46, paragraph 72, states that 
the Law on Encouragement of Capital Investment (5719) of 1959 allows manufacturers to benefit 
from tax incentives and grants, however, this stru cture has failed to achieve the desired economic 
development and instead has created various distorti ons in the economy. Can Israel explain how this 
legislation is consistent with WTO rules? 
Answer: 
We believe that the above citation should be read in  the context of paragraph 72 (in full) of  the 
Secretariat's report: 
 "72. Under the Law on Encouragement of Capital Investment (5719) of 1959, 
companies, mainly manufacturers, benefit fr om tax incentives and grants with preference 
given to:  (i) priority development regions in the periphery of the country;  (ii) export-oriented enterprises, and (iii) large multin ationals.  The law al so authorizes special 
incentives for the tourism sector (see Chapter IV(4)(iv)).  The law was further amended on 1 January 2011 (Amendment 68) to reform the incentive structure amongst other things. According to some observers the incentives had largely failed to achieve the law's objective 
of promoting economic development in the peripheral regions, and had created various 
distortions in the economy (Chapter IV(3)(i))."  
Criticisms of the ECIL have been raised by only  some observers.  In addition, the amendments 
mentioned above were intended to address th e shortcomings that have been raised. 
As to the second question it should be noted th at the overall budget for the program is relatively 
small. In addition, the requirements under the ECI L are designed to ensure that incentives are 
available to companies that contribute to the fi nancial independence of the Israeli economy and are 
competitive contributors to the gr oss national product. Israel is of the view these incentives are 
consistent with WTO rules.  WT/TPR/M/272/Add.1 
 Page 79 
 
 
In accordance with Chapter 3, Section 3) "M easures Affecting Trade Production", page 60, 
paragraph 119 and others, it is clear that Israel  does not implement the system established under 
paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health. Can Israel indicate 
if it plans to implement this system under its national law? Has Israel decided if it would opt to be considered as an exporter, importer or both, under this system? 
Answer: 
There are no plans at this time to use this system. 
Chapter 4, Section 4) "Services", page 78, paragr aph 54, could Israel e xplain how it limited the 
exposure of institutional investors to high-risk b onds? What types of measures were implemented in 
order to achieve this objective? 
Answer:  
Israel's banks' exposure to various risks was limited du e to existing regulations;  the Bank of Israel 
didn't actively limit the exposure of institutional investors to high-risk bonds. 
In accordance with Chapter 4, Section 4) "Services", page 80, paragraph 58, it is stated that through a 
market restructuring reform, banks were required to divest their interests in mutual funds and long-
term savings, with their assets being sold to insu rance companies and other institutions (brokers). 
Could Israel explain how this reform is consis tent with its specific commitments under services? 
Answer: 
The market restructuring reform applied to all banks regardless of whether they were foreign 
owned or not. Therefore we don't view this refor m as a violation of our commitments under the 
GATS.  
Chapter 4, Section 1.4, paragraph 27, page 70 stat es that "TRQ levels and conditions are announced 
annually by the ministries on their websites a nd in two domestic news papers. The announcement 
includes information on source countries, HS codes, and quota volumes. All import licences issued by 
the MOITAL and most licences issued by the MARD ar e valid from 1 January to 31 July. In August, 
the ministries publish another notice, inviting importe rs to submit requests for quantities not utilized in 
the first seven months of the year. Those licences are valid from 1 September to 25 December. Unused 
allocations must be returned. Importers that fail to  use or return their allocations are excluded from 
eligibility in the subsequent quota year. Allocations are not tradable or transferable. Applications are 
free of charge. Imports under MFN tariff quotas continue to exceed WTO tariff-quota volumes, except for edible fats and oils." Could Israel indicate if  there are any fishery products among the goods where 
tariff-quotas are imposed? 
Answer: 
No fishery products are included in Israel's TRQ commitments. RUSSIAN FEDERATION 
Page 16, paragraph 12 
The considerable part of trade of the country is the trade with bilateral agreem ents  partners. In this 
regard could Israel clarify is the bilateral trade in priority  of the trade policy of the country? WT/TPR/M/272/Add.1 
Page 80  Answer:  
Israel views its bilateral trade agreement  as comp lementary to the work done in the WTO, at the 
multilateral level. While Israel is actively seeking ne w and improved market access for its exports of 
goods and services by concluding FTAs, at the same  time Israel promotes the work of the WTO by 
pushing for improved trade disciplines and rules.  
Israel bilateral agreements are in line with the rules of Article XXIV of GATT 1994, and were 
notified as required to the Committe e on Regional Trade Agreements. 
In this case of negative balance in trade with the fo reign  partner at the moment  of conclusion of free 
trade agreement what trading instruments are allowe d by Israel for compensating of such imbalance? 
Answer:  
No such instruments are in use by Israel. 
Measures directly affecting Exports Page 37 What of the listed measures are the most effective? 
Answer:  
Each of the measures are intended to achieve diffe rent policy objectives therefore it is impossible to 
determine which measure is most effective. 
PERU 
The following questions relate to customs matters: Does Israel's Customs Administration Authority impl ement a control mechanism to detect and prevent 
fraud in the custom valuation of imported goods? 
Answer: 
The control mechanism is implemented by the custom's computerized profile system. 
How does Israel determine the value of licenses for the use of software contained in carrier media, in 
accordance to Decision 4.1 of the Cust oms Valuation Committee of the WTO? 
Answer:  
In determining the Customs value of imported carr ier media bearing data or instructions, only the 
cost or value of the carrier medium itself is t aken into account.  The Customs value doesn't   
include the cost or value of the data or instructions, provided that this is distinguished from the cost 
or the value of the carrier medium. 
The value of licenses for the use of software/ data or instructions is separately charged with V.A.T 
according to the appropriate regulations.  
Does Israel's Customs Administration Authority im plement a simplified procedure to determine the 
customs value of goods that entered the count ry as postal items, household goods or accompanied 
baggage?  WT/TPR/M/272/Add.1 
 Page 81 
 
 
Answer:  
Customs duties and VAT exemptions are given to postal items under the value of 50 USD and to 
accompanied baggage under the value of 200 USD, while postal items under the value of 350 USD are only exempts from customs duties. All other procedures to determine the customs 
value are the same as the regular procedures. 
How does Israel determine the customs value of goods in general, especially in relation to the use of 
the "last resort valuation method"? 
Answer: 
About 95% of all imports to Israel are released fr om customs without intervention and pursuant to 
the rules applied in Article 1 of the Agreement On  Implementation Of Article VII Of The General 
Agreement On Tariffs And Trade.  The "Last resort  valuation method" is applied only in special 
cases of import like borrowed articles, renta l goods and in case of used materials. 
In relation to the non-obligation to engage the ser vices of a customs broker for commercial imports, as 
well as the non-obligation of the company to have a di rect link with the customs system; is it possible 
for companies to manage their imports manually, i.e. without the use of a customs linked system? 
Answer:  
No. 
If companies can manage their imports directly with out third party intervention, how can the accuracy 
of the technical information, such as tariff classi fication or valuation of goods, be ensured? Are there 
many rejections of customs declaration procedures due to errors in these criteria? 
Answer: 
Companies can manage their imports directly withou t third party intervention if they are connected 
to the customs system.  Additional obligation is ha ving either custom broker or licensed Clark that 
is allowed to submit custom declaratio n. The rejection percentage is similar. 
It is noted that the customs administration has an electronic service to issue advance rulings on tariff 
classification of goods. When samples are require d for the classification, how does the applicant 
submits them to the customs administration authority? Does the tariff classification service have a 
monetary cost? If so, is payment done electronically? 
Answer: 
When customs asks for a sample of a good, the applicant may send it by mail or bring it physically 
to the Customs.  Classifica tion information service is free.  
What is the deadline for the issuance of  advance rulings on tariff classification? 
Answer:  
45 days. 
Is the requirement to be previously registered w ith the relevant Tax Authority, the only relevant 
requirement for importers in relation to customs? WT/TPR/M/272/Add.1 
Page 82  Answer:  
This requirement is the only one for commercial import. 
What are the requirements for the granting of an import  license? (other than the criminal record of the 
importer). 
Answer: 
Requirements may vary according to the imported pr oducts. They are set by the competent authority 
(e.g. at the ministries of Transportation, He alth, communication). Note that there are no 
requirements regarding the criminal record of the importer. 
Under which circumstances is a license/authorizat ion issued within 14-21 days? (in most cases, 
licenses/authorizations are issued in less than 7 days). 
Answer: 
In general, licenses/authorizations are issued in  less than 7 days. If necessary, the Free Import 
Order allows to prolong this period to 21 days.  
__________