G/SCM/N/401/ISR  
 
12 October 2023  
(23-6849) Page: 1/34 
Committee on Subsidies and Countervailing Measures  Original: English  
 
  
SUBSIDIES  
NEW AND FULL NOTIFICATION PURSUANT TO ARTICLE XVI:1  
OF THE GATT 1994 AND ARTICLE 25 OF THE AGREEMENT  
ON SUBSIDIES AND COUNTERVAILING MEASURES  
ISRAEL 
The following communication, dated and received on 14 September 2023, is being circulated at the 
request of the delegation of Israel.  
 
_______________  
 
 
  G/SCM/N/401/ISR  
 
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  Index  
1   INTRODUCTION  ................................ ................................ ................................ ..........  4 
2   RESEARCH AND DEVELOPMENT  ................................ ................................ ...................  4 
2.1   The Innovation  Authority  ................................ ................................ ............................  4 
3   THE INNOVATION AUTHORITY – THE START -UP DIVISION  ................................ .........  4 
3.1   Tnufa program  ................................ ................................ ................................ ..........  4 
3.2   Incubators program  ................................ ................................ ................................ ... 5 
3.3   Innovation Labs program  ................................ ................................ ............................  6 
4   THE INNOVATION AUTHORITY – GROWTH DIVISION  ................................ .................  7 
4.1   Research and Development  Fund ................................ ................................ .................  7 
4.2   Space Technology  ................................ ................................ ................................ ...... 8 
4.3   Support Grants for "Pilot" Programs  ................................ ................................ .............  9 
5   SUPPORT IN R&D OF ASSISTIVE TECHNOLOGY FOR THE DISABLED  .........................  10 
6   MANUFACTURING -ORIENTED INDUSTRY  ................................ ................................ .. 11 
7   R&D PREPARATORY PROGRAM FOR COMPANIES IN  
THE LOW -TECHNOLOGY INDUSTRY  ................................ ................................ ................  12 
8   THE INNOVATION AUTHORITY – TECHNOLOGICAL  
INFRASTRUCTURE DIVISION  ................................ ................................ .........................  13 
8.1   Generic Technologies R&D Consortiums - MAGNET  ................................ ........................  13 
8.2   Generic R&D Program for Large  Companies  ................................ ................................ .. 14 
8.3   Knowledge Commercialization  program – (formerly known as MAGNETON)  .......................  15 
8.4   Promoting Applied Research in Academia  ................................ ................................ ..... 16 
9   THE INNOVATION AUTHORITY – INTERNATIONAL  
COLLABORATION DIVISION  ................................ ................................ ...........................  17 
9.1   Bilateral programs for mutual support  ................................ ................................ .........  17 
9.2   R&D Collaboration with Multinational Corporations Program (MNC)  ................................ .. 18 
9.3   Bi-national  Funds  ................................ ................................ ................................ ..... 20 
10   AID TO SMALL AND MEDIUM -SIZED COMPANIES  ................................ ....................  21 
11   BUSINESS DEVELOPMENT  CENTERS - MAOF  ................................ .............................  21 
12   INTENSIVE COMPUTER SYSTEM IMPLEMENTATION FOR SMES  ................................  22 
13   FORE IGN TRADE ADMINISTRATION  ................................ ................................ ........  23 
13.1   Smart Money Program  ................................ ................................ .............................  23 
14   SUPPORT FOR EMPLOYMENT AND TRAINING  ................................ ..........................  24 
14.1   Training Courses for Adults  ................................ ................................ ......................  24 
14.2   On the Job Training  ................................ ................................ ................................ . 25 
14.3   Factory Study Classroom  ................................ ................................ .........................  26 
14.4   Apprenticeship  Training Program - "Starter"  ................................ ...............................  26 
14.5   Vouchers program  ................................ ................................ ................................ .. 27 
15   THE INVESTMENTS AUTHORITY AT THE MINISTRY OF  
ECONOMY AND INDUSTRY  ................................ ................................ .............................  28 
15.1   Employment Grant Program  ................................ ................................ .....................  28 
15.2   Investment Incentives  in the Law for the Encouragement of Capital Investment  ...............  29 G/SCM/N/401/ISR  
 
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  15.3   Industry Productivity Enhancement and Implementation of  
Advanced Production Technologies  Program  ................................ ................................ .........  30 
15.4   Reducing  greenhouse gas emissions and improving energy efficiency program .................  30 
16   OTHER FORMS OF SUBSIDIES  ................................ ................................ .................  31 
16.1   Cost of Land Development  ................................ ................................ .......................  31 
16.2   Eilat Free Trade  Zone ................................ ................................ ..............................  32 
16.3   Free Port Zone ................................ ................................ ................................ ....... 33 
16.4   Fisheries - Waiver  of excise tax on fuel  ................................ ................................ ...... 33 
 
  G/SCM/N/401/ISR  
 
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  1  INTRODUCTION  
Following G/SCM/N/372/ISR  covering the year 2020, this notification relates to measures which are 
currently in force and provide s, as far as possible, statistical information for the years 2021 -2022.   
A considerable effort has been undertaken by the Government  of the State of Israel to submit a 
comprehensive notification in accordance with the requirements of the Agreement on Subsidies and 
Countervailing  Measures. The notification follows, as far as possible, all the elements required by 
Article  25 of the Subsi dies Agreement and by the subsidies questionnaire.  
In accordance with Article 25.7 of the Subsidies Agreement, the fact that a measure has been notified, 
does not prejudge either its legal status under GATT 1994 or the Subsidies Agreement, nor does it 
prejudge its effects under the Agreement or the nature of the measure itself.  Furthermore, this does 
not imply in any way, that any of the measures notified, wholly or partly, amounts to a specific subsidy.  
2  RESEARCH AND DEVELOPMENT  
2.1  The Innovation  Authority  
The National Technological Innovation Authority of the State of Israel (the "Innovation Authority") was 
established by the Israeli Encouragement of Research, Development and Technological Innovation in 
the Industry Law, 5744 -1984 inter alia, to directly o r indirectly encourage, promote and support 
research, development and technological innovation in the Israeli industry, and to develop the 
infrastructures needed for the above .  
The Innovation Authority is divided into four professional divisions, each res ponsible for a specific 
target audience:  
1. Start-up Division  
2. Growth Division  
3. Technological Infrastructure Division  
4. International Collaboration Division  
1. Legal Basis  
The legal basis for the establishment of the Innovation Authority is the Israeli Encouragement  of 
Research, Development and Technological Innovation in the Industry Law, 5744 -1984.  
3  THE INNOVATION AUTHORITY – THE START -UP DIVISION  
The Start -up Division offers unique tools to support the early development stages of technological 
initiatives. These t ools assist entrepreneurs and start -up companies in developing their innovative 
technological concepts at the pre -seed or initial R&D stages, transform their ideas into reality and 
reach significant fundable milestones.  
3.1  Tnufa program   
The Tnufa program is designed for entrepreneurs who are interested in formulating and validating 
an innovative technological concept and in reaching the R&D stage, where they can raise funding 
for further development and commercialization . 
1. The Authority Responsible for the Sub sidy: 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 G/SCM/N/401/ISR  
 
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  3. Policy Objective and/or Purpose  
The program supports entrepreneurs reaching proof of concept and business feasibility of early stage 
projects .  
4. Form of the subsidy  
Entrepreneurs and new start -up companies can receive a conditional grant of up to NIS 200,000 
over a period of two years: NIS 100,000 awarded each year (85% of the approved budget). 
Bio-convergence projects can receive a conditional grant of up to NIS 400,000 over a period of 
two years: NIS 200,000 awarded each year (85% of the approved budget).  
The funds are given for building an initial prototype, protecting intellectual property and business 
development, including, degradable components, contracting with sub -contractors, consultants, 
patent attorneys and exhibition expenses (not intended for salaries and overhead expenses).  
5. To whom the subsidy is provided  
The support is given to  entrepreneurs and new start -up companies.  
6. Duration  
Ongoing.   
7. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 3.56 
2022 4.02 
8. Trade Effects  
The products or processes financed by the program are innovative and cannot therefore compete with 
existing products  in the market . Normally, further work is necessary for the results of an R&D project 
to lead to a commercially exploitable process or product.  Therefore, the program has no direct impact 
on trade.  
3.2  Incubators program   
This program is designed for e ntrepreneurs who are interested in establishing a start -up company 
based on an innovative technological concept. A technological incubator is a center for 
entrepreneurship intended to invest in new start -up companies and to provide them with 
administrative , technological and business support. The incubator offers a supportive framework for 
the establishment of a company as well as development of a concept into a commercial product. 
Currently there are 18 technological incubators and 1 designated biotechnolo gical incubator, which 
are privately owned by seasoned and experienced groups, such as venture capital funds, 
multinational corporations, private investors etc. The incubators are selected through competitive 
processes for a license period of eight years a nd are geographically spread across Israel. The list of 
incubators operating in Israel is available on the Innovation Authority website.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industria l Research and Development, 5744 -1984 G/SCM/N/401/ISR  
 
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  3. Policy Objective and/or Purpose  
Supporting entrepreneurs with innovative technological concepts at the initial stage of R&D in 
establishing start -up companies and helping them reach a significant fundable milestone.  
4. Form of the subsidy  
The conditional grant provided as part of this program is 85% of the approved budget and up to 
NIS 3 million for a period of up to two years, or up to 85% and NIS 5 million for a period of up to 
three years. Companies operati ng in development areas  are eligible for additional funds.  
The conditional grant provided as part of the designated Biotechnological Incubator is 85% of the 
approved budget, up to NIS 8.1 million for a period of up to three years.  
Supplementary financing of 15% of the approved budget is invested by the incubator. No financial 
investment is required by the entrepreneurs.  
Comprehensive assistance is provided by the incubator, including physical space, technological 
infrastructure  and business guidance, as well as access to partners, additional investors and potential 
customers, legal advisory and administrative services.  
5. To Whom the Subsidy is Provided  
The support is provided to p rivate entrepreneurs , new start -up companies, and resear ch institutions 
interested in commercializing technologies based upon groundbreaking studies into startup 
companies.  
6. Duration  
Ongoing  
7. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 45.97  
2022 49.86  
8. Trade Effects  
The products or processes financed by the program are innovative and cannot therefore compete with 
existing products.  Normally, further work is necessary for the results of an R&D project to lead to a 
commercially exploitable process or product.  Therefore, the program has  no direct impact on trade.  
3.3  Innovation Labs  program  
The Program is aimed at assisting entrepreneurs and start -ups with a technological idea, interested 
in reaching a POC with the assistance and guidance of market leading companies that are 
establishing an  innovation lab facility in Israel. The program is designed for encouraging the 
engagement of companies interested in gaining exposure to the Israeli innovation eco -system.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis: 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 G/SCM/N/401/ISR  
 
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  3. Policy Objective and/or Purpose  
Assisting entrepreneurs in the preliminary stages of a product, which requires unique infrastructure 
and expertise to prove the feasibility of a technological idea. The assistance is provided through 
innovation labs operated by the industry 's leading corporations – both Israeli and Foreign via a model 
of open innovation.  
4. Form of the subsidy  
Corporations that are establishing an inn ovation lab will provide entrepreneurs and start -ups with 
guidance to market, connections to their experts and a lab facility. The Innovation Authority will 
fund 33 -50% of the lab technological facility's costs and up to NIS 4 or 6 million and 50% of the 
lab's operational costs and up to NIS 0.5 or 1 million of the total budget, annually.  
The Authority will fund 85% of the start -ups budget in reaching a POC.  
5. To Whom the Subsidy is Provided  
Entrepreneurs and start -ups in their early stages in which the inno vation lab is interested to invest.  
6. Duration  
Ongoing  
7. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 4.77 
2022 3.57 
8. Trade Effects  
The products or processes financed by the program are innovative and cannot therefore compete with 
existing products.  Normally, further work is necessary for the results of an R&D project to lead to a 
commercially exploitable process or product.  Therefore, the program has no direct impact on trade.  
4  THE INNOVATION AUTHORITY – GROWTH DIVISION  
The Growth Division operates a wide range of programs that promote technological innovation of 
mature and growth companies. This division contributes to the promotion and preservation of 
competitiveness and technological leadership of companies, as well as the  increase of their growth 
rates and potential.  
In addition, the division encourages the development of technological innovation in order to promote 
the competitiveness of the manufacturing industry and tackle social and public challenges.  
4.1  Research and Deve lopment  Fund  
This is the main program designed for industrial R&D support for the development of competitive 
products and innovative processes. The R&D Fund, which offers the greatest financial incentives for 
R&D activities by the Israeli government, provi des commercial companies in all areas with support 
for the development processes of new products or for the upgrade of existing technology. The 
support is offered to all businesses in Israel and all their branches, at all stages of R&D.  
1. The Authority Resp onsible for the Subsidy : 
The Innovation Authority  G/SCM/N/401/ISR  
 
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  2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy Objective and/or Purpose  
The R&D Fund encourages technological innovation in order to strengthen and promote the Israeli 
economy.  
4. Form of the subsidy  
A conditional grant of 20% to 50% of the approved R&D expenditures.  
Companies operating in development areas are eligible for additional support of 10 -25%.  
Start-up companies owned by women or by entrepreneu rs from minority groups are eligible for 
support of 70 -75% for a limited time (up to two years).   
5. To Whom the Subsidy is Provided  
The support is offered to all businesses in Israel and all their branches, at all stages of R&D.  
6. Duration  
Ongoing  
7. Budget/expen diture  
Actual Annual Disbursement (in million USD):  
2021 153.12  
2022 159.52  
8. Trade Effects  
The products or processes financed by the program are innovative and cannot therefore compete with 
existing products.  Normally, further work is necessary for the results of an R&D project to lead to a 
commercially exploitable process or product.  Therefore, the program has no direct impact on trade.  
4.2  Space Technology  
This program is a joint initiative of the Innovation Authority and the Israel Space Agency of the 
Ministry of Science, Technology and Space.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
To encourage R&D in the fields of space technology, while strengthening knowledge and 
technological development capacity of the Israeli industry, to reduce the knowledge gap between 
Israel and the global market and to improve the competitiveness of the Israeli industry, amid the 
existing challenges, such as significant technological risk, high development costs, limited production 
quantities and expensive systems.  G/SCM/N/401/ISR  
 
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  4. Form of the subsidy  
Conditional grant of up to 85% of the approved R&D expenditures for a period of 36 months.  
5. To whom  the subsidy is provided  
Companies that develop products in the field of space technology intended for installation in satellites 
or ground stations for management of satellite operations.  
Companies that develop products in the field of space technology in tended for reception or 
transmission of data from satellites.  
Companies that develop equipment for calibration and testing of products in the field of space 
technology intended for installation on -board satellites, or related to the operation of the satell ites, 
including installation of different versions of the satellites.  
6. Duration  
Ceased activity in 2021  
7. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 5.79 
2022 0 
8. Trade Effects  
The products or processes financed by the program are innovative and cannot therefore compete with 
existing products.  Normally, further work is necessary for the results of an R&D project to lead to a 
commercially exploitable process or product.  Therefore, the program has no direct impact on trade . 
4.3  Support Grants for "Pilot" Programs  
Collaboration with government entities (17 entities as of 2020) that enables companies to implement 
innovative technologies in pilot sites in order to grow to an industrial scale.  
1. The Authority Responsible for the Sub sidy: 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy Objective and/or Purpose  
Promoting technology companies from the development phase to a successful market launch.  
4. Form of the subsidy  
20-50% of the project 's pilot costs. Companies operating in development areas are eligible for 
additional support of 10%.  Additional support is po ssible when the potential impact of the technology 
in the specific sector (i.e. transport, healthcare, environment etc.) is expected to be exceptional.   
5. To Whom the Subsidy is Provided  
Technology companies (Start -ups and large companies).  G/SCM/N/401/ISR  
 
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  6. Duration  
Ongoing  
7. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 15.54  
2022 42.42  
8. Trade Effects  
The products or processes financed by the program are innovative and not commercialized yet. 
Therefore, the program has no direct impact on trade.  
5  SUPPORT IN R&D OF ASSISTIVE TECHNOLOGY FOR THE DISABLED  
This unique program encourages R&D of assistive technologies for the disabled and contributes to 
their quality of life while facilitating their integration into society, the community and the labor 
market. These developments benefit the disabled and enable significant financial saving on both 
social and national levels.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
Encouragement of R&D in industrial products that provide technological solutions for the disabled to 
enable them to integrate into society and the labor market. This program is the result of collaboration 
between the Innovation Authority and the National Insurance Fund.  
4. Form of the subsidy  
Companies and non -profit organizations can receive support of 75% of the approved budget for R&D 
for budget requests of up to NIS 500,000, and up to 60% for budget requests of NIS 500,000 to 
NIS 1,500,000. Companies and non-profit organizations  located in development areas are eligible 
for an additional grant of up to 10% of the approved budget.  Companies owned by women or by 
entrepreneurs from minority gr oups are eligible for support of 70 -75% for limited time (up to 
two years).  
5. To whom the subsidy is provided  
Companies and non -profit organizations interested in developing technologies that serve groups with 
physical, mental or cognitive disabilities, who collectively represent up to 5% of the population.  
6. Duration  
Ongoing  G/SCM/N/401/ISR  
 
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  7. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 2.97 
2022 1.52 
8. Trade Effects  
The products or processes financed by the program are innovative and cannot therefore compete with 
existing products.  Further work is necessary for the results of an R&D project to lead to a commercially 
exploitable process or product.  Therefore, the program has no direct impact on trade.  
6  MANUFACTURING -ORIENT ED INDUSTRY  
Sectors in the manufacturing -oriented industry struggle to cope with increasing global competition. 
To prevent stagnation and regression in the low -tech sectors, the Authority offers a variety of 
incentives designed especially to meet these sec tors' needs and to encourage them to be more 
innovative.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
To encourage manufacturing -oriented enterprises to promote and implement innovative 
technological processes, such as the development of innovative products, improvement of existing 
products and production processes. In addition, this program assists factories  in developing new 
strategies based on technological differentiation, in order to create competitive advantages in both 
domestic and international markets.  
4. To whom the subsidy is provided  
Manufacturing -oriented industry companies, from all four R&D intensi ty levels: low, Med -Low, 
Med-High, High.  
For companies from Low and Med -Low R&D intensity sectors, more than 50% of sales must be based 
on self -production in order to qualify for the program.  
For Med -High and High intensity levels, two more conditions appl y:  
1. At least 30% of employees work in manufacturing (and no less than 3 employees).  
2. Up to 25 R&D employees.  
Companies that wish to determine whether their activities qualify for participation in this program 
can apply to the Authority, requesting it to car ry out a preliminary examination regarding their 
affiliation to the low -tech industry.  
5. Duration  
Ongoing  G/SCM/N/401/ISR  
 
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  6. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 51.82  
2022 45.42  
7. Trade Effects  
The products or processes financed by the programs may lead to tangible commercial results, and 
increase the capabilities and competitiveness of the firms involved, effecting trade in a way similar to 
any new products or processes by a company.  
7  R&D PREPARATORY PROGRAM  FOR COMPANIES IN THE LOW -TECH NOLOGY INDUSTRY  
Founded in 2018, a preparatory incentive program is a complementary tool operated by the Authority 
in order to assist low -tech industry companies that are not experienced in carrying out R&D activities 
and innovation processes, or companies  that require focus and guidance with their R&D activities. 
As part of the program, the participating companies get partial funding for their counselling 
expenses, including mapping and examination of existing technological capabilities, formulation of 
future goals, examination of technological gaps, and guidance for improving their capabilities 
through the implementation of technology and more advanced processes.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
To create a corporate culture change in the low -tech industry sectors, including instilling values and 
working methods for continuous R&D and innovation der ived from market needs. This program aims 
to increase the competitiveness of the participating companies through implementing R&D processes 
and adopting new technologies.  
4. Form of the subsidy  
1. In Israel's development areas, the Authority will fund 75% of the  consultancy fee and the 
company will fund 25% of this fee, with a max budget of NIS 100,000.  
2. In Israel's geographic center, the Authority will fund 66% of the consultancy fee and the 
company will fund 25% of this fee, with a max budget of NIS 75,000.  
3. The hourly consulting rate limit is NIS 200 per hour. The company will receive funding of up 
to 200 hours.  
4. As for the financing of the market survey, patent survey or technology survey – the Authority 
will fund 75% of the actual cost up to NIS 12,000 plus VAT.  
5. To whom the subsidy is provided  
Manufacturing -oriented industry companies, from all four R&D intensity levels: low, Med -Low, Med -
High, High.  
For companies from Low and Med -Low R&D intensity sectors, more than 50% of sales must be based 
on self -production in order to qualify for the program.  G/SCM/N/401/ISR  
 
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  For Med -High R&D intensity levels, two more conditions apply:  
1. At least 30% of employees work in manufacturing (no less than 3 employees).  
2. Up to 25 R&D employees.  
6. Duration  
Ongoing  
7. Budget/expenditure   
(in million USD): 
2021 1.73 
2022 1.73 
8. Trade Effects  
The products or processes financed by the program may lead to tangible commercial results, and 
increase the capabilities and competitiveness of the firms involved, effecting trade in a way similar to 
any new products or processes by a company.  
8  THE INNOVATION AUTHORITY  – TECHNOLOGICAL INFRASTRUCTURE DIVISION  
The Technological Infrastructure Division focuses on collaboration between industry and academia 
to produce advanced technologies and innovative products. The programs offered by this division 
promote cooperation, exchange of knowledge and experience, and development of generic 
ground -breaking knowledge by an integrated group of researchers from academia and industry.  
8.1  Generic Technologies R&D Conso rtiums - MAGNET  
The MAGNET program (Generic Pre -Competitive Technological R&D) focuses on consortiums of 
industrial companies and research institutions that collaborate to develop innovative technologies. 
The consortiums enable long -term R&D and create a s upportive work environment. Collaboration 
with industry also strengthens the commercialization capabilities of research institutions and assists 
them in understanding market needs.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis: 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
To assist in the development of generic technologies in important areas, in whom the Israeli industry 
has a competitive advantage. Since the program specializes in the development of fundamental 
technology, it allows knowledge sharing and cooperation between companies operating in the same 
field, which may be difficult to achieve otherwise.  
4. Form of the subsidy  
The amount of the grant provided t hrough the consortium is up to 66% of the approved budget for 
an industrial company and 100% of the approved budget for a research institution (80% as a grant 
and 20% from the industrial companies in the consortium).  
The operating period is three years.  G/SCM/N/401/ISR  
 
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  5. To whom the subsidy is provided  
Manufacturing companies developing competitive products and interested in developing innovative 
technologies, which can be used as a basis to develop a new and advanced generation of products.  
Academic research groups engaged in scientific or technological research, seeking to promote 
applied research as part of a consortium, as well as to collaborate with the industry and study the 
market needs.  
Foreign company as an observer or as full partner with no funding.  
6. Duration  
Ongoing  
7. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 53.93  
2022 61.41  
8. Trade Effects  
Further work is necessary for the results of an R&D project to lead to a commercially exploitable 
process or product. Therefore, the program has no direct impact on trade.  
8.2  Generic R&D Program for Large  Companies  
This program allows large companies to focus on long -term creation of new knowledge and 
technological infrastructure, used for the development or production of future innovative  products.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis:  
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
To encourage and support long -term R&D of large companies, which invest in the development of 
infrastructural knowledge that can be implemented in a series of products over a long -time frame. 
R&D projects submitted to this program should include a long -term R&D plan or collaboration with 
another company . 
4. Form of the subsidy  
A grant of 20% -50% of the approved R&D expenditures for long -term R&D plans or for an R&D 
project executed in cooperation with another company.  
5. To Whom the Subsidy is Provided  
Large companies that employ at least 200 employees in R&D or with a R&D budget in Israel of at 
least USD 20 million. In addition, the company 's average yearly sales (including subsidiaries) must 
exceed USD 70 million for 3 years; or its parent company 's total revenue (with a direct or indirect 
holding of at least 80%) exceeds USD 2.5 billion.  G/SCM/N/401/ISR  
 
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  6. Duration  
Ongoing  
7. Budget/expenditure  
Actual Annual Disbursement (in million USD)  
2021 24.55  
2022 14.38  
8. Trade Effects  
The products or processes financed by the program are innovative and cannot therefore compete with 
existing products.  Normally, further work is necessary for the results of an R&D project to lead to a 
commercially exploitable process or product.  Therefore, the program has no direct impact on trade.  
8.3  Knowledge Commercialization  program  – (formerly known a s MAGNETON)  
This program encourages the transfer of technological knowledge accumulated in the academia for 
the use of the industry, by creating collaborations between companies and academic research 
groups. These collaborations expose industrial companies  to the research achievements relevant to 
their activities and assist research groups in transforming academic research into commercial 
application. In addition, the Program enables the continuance of  generic Technologies R&D 
Consortium projects (see above) for up to additional 2 years.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
Validation of laboratory results and transfer of technology from research institutions to industrial 
corporations for the development of breakthrough products.  
4. Form of the subsidy  
An applied research grant of up to 66% of th e approved budget, up to 24 months.  
5. To whom the subsidy is provided  
Industrial companies seeking to incorporate new technologies developed in the academia and 
striving to develop a new product or to improve an existing product based on recent studies, rele vant 
to their field of activity.  
Academic research groups from research institutes worldwide approved by the Technological 
Infrastructure Division, seeking to carry out innovative and original applied research in collaboration 
with companies interested in the relevant technology. The research should be focused on 
technological feasibility for the industry, and the applying research institute should be the sole owner 
of knowledge in the project.  
6. Duration  
Ongoing  G/SCM/N/401/ISR  
 
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  7. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 7.68 
2022 9.58 
8. Trade Effects  
The products or processes financed by the program are innovative and cannot therefore compete with 
existing products.  Further work is necessary for the results of an R&D project to lead to a commercially 
exploitable process or product.  Therefore, the program has no direct impact on trade.  
8.4  Promoting Applied Research in Academia  
The Applied Research in Academia (previously called NOFAR) program provides support for applied 
research in academia, thus potentially increasing its economic contribution to the economy. This 
program focuses on technologically feasible ideas, which are not mature enough for the support of 
the Knowledge Commercialization program, and require financing in the initial appli ed research stage 
at universities in order to match them with relevant industrial companies from that sector.  
The KAMIN program , which was active until 2019, served as a bridge between basic and applied 
research, and was focused on the stage of transformat ion and realization of basic research into 
technologies with commercial application. During 2019 t he KAMIN program  was merged into the  
Applied Research  in Academia program  as they are both approaching the same target audience and 
the same TRL (Technology Readiness Level).  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
To bridge the gap between academic knowledge and industry needs. All the research activities 
carried out as part of this program are in academic institutions. Some of the researches are being 
accompani ed by the support of an industrial company that sees business potential in the project, 
and some are not. The main goal is to reach significant milestones by the end of the project, which 
will enable the industrial company to sign a technology commercializ ation agreement with the 
research institution. Some of the research activities in the program will receive professional support 
by an industrial company or a relevant business entity (such as a venture capital fund).  
4. Form of the subsidy  
The research instit ution supported by the program is entitled to a grant of up to 90% of the approved 
budget and no more than NIS 550,000 (in case there is an additional support of an industrial 
company), or up to 85% and no more than NIS 440,000 (in case there is no additio nal support of 
an industrial company), for a period of 12 months - with an option to extend the support period in 
up to 24 months (and in some cases – up to 36 months).  
The supporting industrial company (if relevant) serves as a partner in professional guid ance and in 
setting of research goals, as well as participates in the funding of 10% of the project cost.  
At the end of the research, the supporting company receives the first right to negotiate a 
commercialization agreement with the research institution.  G/SCM/N/401/ISR  
 
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  Research conducted in collaboration with two or three different research institutions is eligible for 
funding of up to NIS 810,000 (in case there is an additional support of an industrial company) or up 
to NIS 770,000 (in case there isn 't). 
5. To whom the sub sidy is provided  
Academic research groups in Israel, operating as part of a higher education or research institution, 
seeking to carry out applied research, which is not mature enough to be supported by the industry 
or by the Knowledge Commercialization  program as explained broadly above. The research should 
include a new and original idea that requires proof of concept, with preliminary basic research and 
results that are applicable to Israeli industry.  
6. Duration  
Ongoing  
7. Budget/expenditure  
Actual Annual Di sbursement (in million USD):  
2021 27.4 
2022 23.04  
8. Trade Effects  
The products or processes financed by the program are innovative and cannot therefore compete with 
existing products.  Further work is necessary for the results of an R&D project to lead to a commercially 
exploitable process or product.  Therefore, the program has no direct impact on trade.  
9  THE INNOVATION AUTHORITY – INTERNATIONAL COLLABORATION DIVISION  
The International Collaboration Division is responsible for creating bridges to new interna tional 
markets, building platforms for cooperation in innovative R&D, and attracting strategic foreign 
stakeholders to Israel.  
The International Collaboration Division has three geographical desks: North America and Europe, 
Asia-Pacific, Emerging Markets,  along with a Planning Unit. In addition, ISERD, the Israeli -European 
R&D Directorate, operates as the general Contact Point for the European R&D Framework Program 
in which Israel participates as an associated country.  
Support for international cooperation  projects is made possible through an array of bilateral 
cooperation agreements, bi -national funds, various agreements with strategic partners and 
institutions such as MNCs (Multi -National Corporations) or world -class hospitals; as well as through 
the EU F ramework Program for Research and Innovation.  
Together with its counterpart organizations abroad, the division coordinates call for proposals for 
funding and assists in matching partners in Israel and abroad for joint R&D projects and other 
business ties.  
9.1  Bilateral programs for mutual support  
The bilateral programs for parallel support of industrial R&D constitute a platform for promotion of 
technological innovation among industrial and research entities. The Authority operates these 
programs in collaborati on with R&D and innovation funding bodies in leading countries, provinces 
and cities in Asia, North and South America, Europe, and Australia.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  G/SCM/N/401/ISR  
 
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  2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
Initiation of bilateral or multilateral R&D joint projects, conducted simultaneously in Israel by local 
affiliates and abroad by designated partners.  
4. Form of th e subsidy  
Assistance in finding a foreign partner.  
Conditional grant of up to 50% of the approved budget of an R&D project (or up to 75% for 
companies owned by women or by entrepreneurs from minority groups ), or in accordance with the 
financial incentive p rogram relevant for a joint project . Companies located in development areas are 
eligible for additional grant of up to 25% of the approved budget.   
Depending on the nature of the R&D collaboration agreement between the two countries, the 
collaboration 's approval can be provided without financial assistance (self -financing of the applicant 
company).  
5. To whom the subsidy is provided  
Technological industrial companies from all industry sectors that wish to develop or upgrade the 
development of  products, services or manufacturing processes with an international partner.  
Technology companies and start -ups seeking to create strategic alliances and partnerships with 
companies and organizations abroad, to expand their operations, to undertake Beta s ite and trial 
(pilot) projects, to gain access to innovative R&D infrastructure abroad (labs, simulators, etc.), locate 
additional sources of financing, break into new markets and benefit from the access to knowledge 
and technology existing overseas.  
6. Durat ion 
Ongoing  
7. Budget/expenditure  
Actual Annual Disbursement (in million USD):  
2021 9.81 
2022 6.37 
8. Trade Effects  
The R&D financed by the program, by definition, involves more than one country, and an increase in 
trade is likely, contingent on the success of the program.  
9.2  R&D Collaboration with Multinational Corporations Program (MNC)  
The program aims to connect foreign multinational corporations (MNCs) and innovative companies.  
Israel has been frequently referred to as the "Start-up Nation " with over 600 net new start -ups 
established annually. While start -ups are in many cases the ones to make the technological 
breakthrough, they are often complemented by the involvement of large  companies, in particular 
large multinational organizations, who serve as a strategic partner and assist in commercialization, 
manufacturing and in opening the door to global markets.  G/SCM/N/401/ISR  
 
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  In order to encourage the creation of MNC -Start-up partnerships in Israe l, the Israel Innovation 
Authority operates a dedicated Global Enterprise R&D Collaboration Program.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
To enable small and medium companies to establish relationships with MNCs and take part in their 
technological and marketing activities. The program encourages networking and strategic 
cooperation betw een the two sides.  
4. Form of the subsidy  
Companies can receive a grant of 20 -50% (or up to 75% for companies owned by women or by 
entrepreneurs from minority groups ) of the development budget approved by the Research 
Committee of the Authority. Companies located in development areas are eligible for an additional 
grant of up to 25% of the approved budget.   
The company receives assistance and support from the MNC in the form of consulting, services and 
resources. The company may keep its intellectual property (IP), share the ownership of it with the 
MNC, or provide the MNC with a non -exclusive license to use the new knowledge through an 
agreement between the project partners.  
The MNC receives services such as scouting for possible partners and IP rights in the new projects 
(see above). In addition, the MNC is informed of the due diligence results of the partner companies.  
5. To whom the subsidy is provided  
Qualification requirements for Multinational Corporations include:  
1. Annual revenues exceeding USD 1.5 Billion  
2. Significant investment in R&D  
3. Worldwide presence of R&D facilities and activities  
4. Upon qualification, the MNC will be required to sign a Memorandum of Understanding with 
the Israel Innovation Authority, which will settle the terms of cooperation between the  MNC 
and the company.  
Qualification requirements for companies include:  
1. Strong R&D focus  
2. Annual revenues not exceeding USD 70 Million  
3. No affiliation to the MNC  
6. Duration  
Ongoing  
7. Budget/expenditure  
Included in the general budget for the Bilateral Programs (as described above).  G/SCM/N/401/ISR  
 
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  8. Trade Effects  
The R&D financed by the program, by definition, involves more than one country, and an increase in 
trade is likely, contingent on the success of the program.  
9.3  Bi-national  Funds  
The Israel Innovation Authority ope rates bi -national funds along with its counterparts in foreign 
countries, in accordance with the agreements signed between the Israeli government and the 
governments of the respective partner countries. Each country allocates dedicated funds to finance 
joint R&D projects between Israeli and foreign companies. Currently, there are a number of 
bi-national funds in operation.  
1. The Authority Responsible for the Subsidy : 
The Innovation Authority  
2. Legal Basis : 
Law for the Encouragement of Industrial Research and Development, 5744 -1984 
3. Policy objective and/or purpose  
To increase the competitiveness and relative advantage of companies in the global market, by 
encouraging cooperation between them and foreign companies, in addition to promotion and 
development of new and complementary technologies, while reducing the financial and technological 
risk exposure.  
4. Form of the subsidy  
1. Assistance in finding a partner.  
2. Financial assistance of up to 50% of the approved budget for a R&D project.  
3. One-stop-shop for ongoing support throughout the life of a collaboration project, from 
proposal preparation and submission, until end of final technological and fiscal reviews.  
5. To whom the subsidy is provided  
Technology companies from all industrial sectors that seek to  develop or upgrade innovative 
products or processes with an international partner.  
Technology companies and start -ups seeking to create strategic alliances and joint ventures with 
suitable companies abroad, in order to expand their operations, find additi onal sources for R&D 
funding, break into new markets and benefit from the knowledge and technology available abroad.  
6. Duration  
Ongoing  
7. Budget/expenditure  
Data not available.  
8. Trade Effects  
The R&D financed by the program, by definition, involves more than one country, and an increase in 
trade is likely, contingent on the success of the program.  G/SCM/N/401/ISR  
 
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  10  AID TO SMALL AND MEDIUM -SIZED COMPANIES  
1. The Authority Responsible for the Subsidy  
Small and Medium Businesses Agency (SMBA).The Accountant General Department in the Ministry 
of Finance is responsible for operating the fund.  
2. Legal Basis  
Government decision.  
3. Policy objective and/or purpose  
To provide assistance to owners and entrepreneurs of small businesses in establishing, managing 
and expanding thei r businesses.   
4. Form of the subsidy  
• SME State loan guarantee : The subsidy is provided by means of a state deposit at the bank , 
offering the best terms of loans and parallel guarantees to small and medium businesses. A 
small business that has an annual turnover of up to NIS 6.25 million can receive a loan of 
up to NIS 500 thousand . A medium business that has an annual turnover of over 
NIS 6.25 million can receive a loan of up to 8% of the business's annual turnover. Th e loan 
is given for a period of up to five years with half a year grace.  
• SME State loan guarantee – COVID -19 ( ended March 2022): A special business loan fund 
was created to assist businesses with cash flow difficulties caused by the implications of 
COVID -19 pandemic. The subsidy is provided by means of a state deposit at the bank, 
offering the best terms for loans. A business with an annual turnover of up to NIS 400 million 
can receive a loan of 40% of its annual turnover and up to NIS 20 million. Loans ar e given 
for a period of up to ten years with a one -year grace.  
5. To whom the subsidy is provided  
• SME State loan guarantee : Provided to small and medium enterprises with an annual 
turnover of up to NIS 100 million.  
• SME State loan guarantee – COVID -19: Was pr ovided to enterprises with an annual turnover 
of up to NIS 400 million.  
6. Budget/Expenditure  
In ordinary years, the fund has an "insurance" element and it compensates the banks  in 
approximately  USD 17 million annually for the costs of failure to repay loans by SMEs.  
The costs of failure to repay loans by SMEs in 2021 -2022 are not known yet.  
7. Duration  
Ongoing.   
8. Trade Effects  
Since the program has provided urgent support for companies experiencing substantial difficulties 
as a result of the COVID -19 pandemic, it is not possible to determine  yet what, if any, trade effects  
may result from this program.   
11  BUSINESS DEVELOPMENT  CENTERS - MAOF  
1. The Authority Responsible for the Subsidy  
Small and Medium Businesses Agency (SMBA).  G/SCM/N/401/ISR  
 
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  2. Legal Basis  
Government decision.  
3. Policy objective and/or purpose  
To provide assistance to owners and entrepreneurs of small businesses in establishing, managing 
and expanding their businesses.   
4. Form of the subsidy  
The  Small and Medium Businesses Agency has established  4 SBDCs (Small Business Development 
Centers) called "Maof centers". The SMBA is financing, monitoring and supervising these centers.  
These centers are meant to serve as a central address for small and medium enterprises (SMEs) 
owners and for entrepreneurs  that are planning new businesses. The main activity of Maof centers, 
designed as "one -stop shop" for entrepreneurs training, is business training such as workshops, 
courses, and consultancy for SME s and for potential entrepreneurs. It also operates a few small 
projects such as business accelerators, assisting SMEs to set up their digital commerce platforms or 
to get business credit from banks and funds. In addition, the Maof centers provide training for local 
government entities on how to be more "SMEs fri endly" in their services and local policy.  
5. To whom the subsidy is provided  
Entrepreneurs  and micro, small and medium enterprises, with emphasis to encourage business 
entrepreneurship among special or disadvantaged populations, such as ultra -Orthodox, minorities, 
new immigrants, unemployed and the population in disadvantaged geographic areas.  
6. Budget/Expenditure  
Actual Annual Expenditure (in million USD) : 
2021 38.4 
2022 36.3 
7. Duration  
Ongoing.   
8. Trade Effects  
In light of the scope and nature of the assistance provided, it is not possible to determine what, if 
any, trade effects  may result from this program.   
12  INTENSIVE COMPUTER SYSTEM IMPLEMENTATION FOR SMES  
1. The Authority Responsible for the Subsidy  
Small and Medium Businesses Agency (SMBA).  
2. Legal Basis  
Government decision.  
3. Policy Objective and/or Purpose  
The purpose of the progr am is to increase the use of digital tools in SMEs in order to increase their 
productivity.   G/SCM/N/401/ISR  
 
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  4. Form of the Subsidy  
Grants amounting to up to 40 percent of the expenses of the implementation of computer systems 
and up to a ceiling of 500,000 NIS per company.  
5. To Whom the Subsidy is provided  
The subsidy is provided to SMEs in the manufacturing industry, commerce, hospita lity and food 
services with an annual turnover of up to 100m NIS.  
6. Budget/Expenditure  
(in million USD):  
2021 0 
2022 6 
7. Duration  
Ongoing  
8. Trade Effects  
In light of the scope and nature of the assistance, it is not possible to determine what, if any, trade 
effects  may result from this program.   
13  FOREIGN TRADE  ADMINISTRATION  
The Foreign Trade Administration (FTA) at the Israeli Ministry of Economy and Industry, initiates, 
manages and promotes Israel 's trade activities and trade policy.  
13.1  Smart Money Progr am 
1. The Authority Responsible for the Subsidy  
Foreign Trade Administration, Ministry of Economy and Industry.  
2. Legal basis  
Government decisions and directives of the Ministry of Economy and Industry's Director General.  
3. Policy objective and/or purpose  
The purpose of the program is to encourage exporters to adopt advanced marketing strategies, to 
use advanced marketing tools, to assist them in building a marketing infrastructure and to provide 
them with the necessary marketing training.  
4. Form of the subsidy  
The subsidy is in the form of a conditional grant which  offers up to 50% reimbursement of certain 
approved expenditures. Companies owned by minority groups in Israel (Muslims, Druze, Bedouins, 
Christians and Circassians) receive 75% reimbursement of the app roved expenditure. Those 
companies receive additional preferential treatment in the eligibility rules and the allocation process.  
The program supports the following expenses: training in international marketing, market analysis, 
marketing communication, p articipation in professional exhibitions, marketing consulting, office 
establishment and management, employing local employees, flight expenses, legal assistance, 
regulatory expenses and foreign trade insurance. The conditional grant is given for a 2 -3 yea rs' 
period, and royalties payment is required only when the company presents profits from its activity.  G/SCM/N/401/ISR  
 
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  5. To whom the subsidy is provided  
First track: The subsidy is provided to companies with international sales of less than USD 250,000 
and a turnover of n ot less than USD 125,000 but not more than USD 25 million.  
Second track: The subsidy is provided to companies with international sales of over US$ 250,000 
and a turnover of no more than approximately US$ 55,000,000 in all sectors.  
6. Budget/Expenditure  
(Actual annual disbursements in million USD):  
2021 26 
2022 28.75  
7. Duration  
Ongoing  
8. Trade Effects  
In light of the scope and nature of the assistance, it is not possible to determine what, if any, trade 
effects may result from this program.   
14  SUPPORT FOR EMPLOYMENT AND TRAINING  
14.1  Training Courses for Adults  
1. The Authority Responsible for the Subsidy  
Vocational Training and Development Bureau, Ministry of Labor . 
2. Legal Basis  
Government decisions.  
3. Policy Objective and/or Purpose  
To provide vocational courses for job seekers and targeted groups (such as single parents, 
minorities, people with disabilities), who need a vocation in order to find a suitable job.   
4. Form of the Subsidy  
The Ministry of Labor finances the courses and the workshops .  
5. To Whom the Subsidy is Provided  
Daytime vocational courses for job seekers and targeted groups such as single parents, minorities, 
people with disabilities who need a vocation in order to find a suitable job in the modern labor 
market.   
The courses take place in v ocational training institutes for a group of about 20 participants, usually 
unemployed.  At the end of the course, the participants go through governmental exams and get 
official certification from the Ministry.  G/SCM/N/401/ISR  
 
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  6. Budget/Expenditure  
Actual annual disbursement s (in million USD):  
2021  11.36  
2022  7.06 
7. Duration  
Ongoing.   
8. Trade effects  
In light of the scope and nature of the assistance, no trade effects  may result from this program  
14.2  On the Job Training   
1. The Authority Responsible for the Subsidy  
Vocational Training and Development Bureau, Ministry of Labor.  
2. Legal Basis  
Government decision.  
3. Policy  Objective and/or Purpose  
The purpose of the program is to integrate job seekers in the workforce, lower the unemployment 
rate and instil a professional b ase during the period of employment in various industries for a 
select ed list of vocational training courses, as specified on the Ministry's website.  
4. Form of the Subsidy  
Participation in the employees and mentor's  salary  for a period of six months.   
5. To Whom the Subsidy is Provided  
Any employer who is interested in hiring new employees and provides on the job training according 
to the job's requirements. The training is implemented through a mentoring system.  
6. Budget/Expenditure  
Actual annual disbursements (in million USD):  
2021 2.1 
2022 21.41  
7. Duration  
Ongoing.  
8. Trade Effects  
In light of the scope and nature of the assistance, no trade effects  may result from this program  
9. Other Relevant Information  
The subsidy is given after the employee completes 6 months of employment.  G/SCM/N/401/ISR  
 
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  14.3  Factory Study Classroom  
1. The Authority Responsible for the Subsidy  
Vocational Training and Development Bureau, Ministry of Labor . 
2. Legal Basis  
Government guidelines  
3. Policy  Objective a nd/or Purpose  
The purpose of the program is to integrate job seekers into the workforce, lower the unemployment 
rate and to instil a professional base during the period of employment.  
4. Form of the Subsidy  
Providing a Professional Training Course.   
5. To Whom the Subsidy is Provided  
Any employers (factories, employer association, industry groups) who are interested in training job -
seeking students in preparation towards full employment.  
6. Budget/Expenditure  
Actual annual disbursements (in million USD):  
2021 0.88 
2022 6.27 
7. Duration  
Ongoing.   
8. Trade Effects  
In light of the scope and nature of the assistance, no trade effects  may result from this program . 
14.4  Apprenticeship  Training Program - "Starter"  
1. The Authority Responsible for the Subsidy  
Vocational Training and Development Bureau, Ministry of Labor . 
2. Legal Basis  
Government guidelines.  
3. Policy  Objective and/or Purpose  
The purpose of the "Starter" program is to provide an apprenticeship professional training that 
integrates both theoretical and practical  training in an academic institute, while being employed and 
acquiring professional experience. The program provides skilled and experienced employees for the 
employers and enables job seekers to acquire a profession parallel to work experience.  G/SCM/N/401/ISR  
 
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  4. Form of t he Subsidy  
Professional training courses and workshops for job seekers and subsidies for employers for their 
financial participation in the employees training.   
5. To Whom the Subsidy is Provided  
The subsidy is provided in two forms:  
1. Job seekers and employees that work in low -skilled positions who are interested in acquiring 
a profession and integrating into that professional field.   
2. Employers who are in need of skilled employees for vacant positions.  
6. Budget/Expenditure  
Actual annual d isbursements (in million USD):  
2021  3.38 
2022  5.47 
7. Duration  
The program was terminated at the end of 2022.  
8. Trade Effects  
In light of the scope and nature of the assistance, no trade effects  may result from this program  
14.5  Vouchers program  
1. The Authority Responsible for the Subsidy  
Vocational Training and Development Bureau, Ministry of Labor . 
2. Legal Basis  
Government decisions.  
3. Policy  Objective and/or Purpose  
The purpose of the program is to encourage unemployed,  job seekers among targeted population 
groups in the population  to acquire vocational training and participate in the labor market.  
4. Form of the Subsidy  
Vouchers given by the Vocational  Training and Development Bureau . An average   voucher is up to 
USD 2,178  and the maximum voucher is up to USD 3,272, for professional courses that can be taken 
at one of the institutions for vocational training.   
5. To Whom the Subsidy is Provided  
Unemployed, job seekers and targeted population groups such as single parents, minor ities, people 
with disabilities, people above the age of 45, former prisoners and others who need a vocation in 
order to find a suitable job in the Israeli labor market.   G/SCM/N/401/ISR  
 
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  6. Budget/Expenditure  
Actual annual disbursements (in million USD):  
2021  15.65  
2022  14.68  
7. Duration  
Ongoing.   
8. Trade Effects  
No trade effects may result from the use of this program.  
15  THE INVESTMENTS AUTHORITY AT THE MINISTRY OF ECONOMY AND INDUSTRY   
15.1  Employment Grant Program  
1. The Authority Responsible for the Subsidy  
The Authority for Investments and Development of the Industry and Economy  at the Ministry of 
Economy and Industry   
2. Legal basis  
Directives of the Director General and Government decisions  
3. Policy Objective and/or Purpose  
To increase employment rates in disadvantaged geographic areas of Israel as well as specific 
populations which exhibit high rates of unemployment . 
4. Form of the Subsidy : 
Grants based on 20 -40% of the employee's wage. The grants are given quarterly to the companies, 
for a period of two to three years to establish the employees on the job and create occupational 
future.  
5. To Whom the Subsidy is Provided  
Subsidies under this program are offered to companies establishing or expanding industrial plants, 
call centers, computer service support cent ers or logistic centers. In order to be eligible for this 
program, these companies must maintain minimal employment and wage levels.  
6. Budget/Expenditure  
Actual annual disbursements ( in million  USD):  
2021 44.4 
2022 32.17  
7. Duration  
Ongoing.   G/SCM/N/401/ISR  
 
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  8. Trade Effects  
The program assists businesses in disadvantaged geographic areas of the country. Therefore, it is 
hard to estimate what, if any, trade effects may result from this program.  
15.2  Investment Incentives  in the Law for the Encouragement of Capital Investmen t 
1. The Authority Responsible for the Subsidy  
The Authority for Investments and Development of the Industry and Economy  at the Ministry of 
Economy and Industry  
2. Legal basis  
The Law for the Encouragement of Capital  Investment, 5719 - 1959.   
3. Policy Objective and/or Purpose  
The purpose of this program is  to encourage both local and foreign capital investments and 
commercial entrepreneurship, particularly innovation and economic activities, in disadvantaged 
geographic  areas.  
4. Form of the Subsidy  
The support given under this program is in the form of grants and/or reduced rates of taxation.  
Grants of up to 30% of the approved capital investment are given to approved enterprises located 
in disadvantaged geographic  areas . 
5. To Whom the Subsidy is provided  
Subsidies under this program are provided to globally competitive industrial companies located in 
disadvantaged geographic areas.  
6. Budget/Expenditure :  
Actual annual disbursements1 (in million USD):  
2021 95.5 
2022 83.16  
7. Duration  
Ongoing.   
8. Trade Effects  
The assistance under this program is granted to enterprises located in disadvantaged geographic 
areas, in order to offset local investment disadvantages and raise the levels of income and 
employment in structurally weak areas.  Therefore, the program is neutral in terms of competition 
and has no effect on competition in international trade.  
 
1 Not including tax benefits  G/SCM/N/401/ISR  
 
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  15.3  Industry Productivity Enhancement and Implementation of Advanced Production 
Technologies  Program  
1. The Authority Responsible for the Subsidy  
The Authority for Investments and Development of the Industry and Ec onomy  at the Ministry of 
Economy and Industry . 
2. Legal basis  
Directives of the Director General and Government decisions.  
3. Policy Objective and/or Purpose  
The purpose of this program is to encourage both local and foreign capital investments that aims 
specifi cally to improve the productivity of the Israeli manufacturers.  
4. Form of the Subsidy  
The support given under this program is in the form of grants.  Grants of up to 30% of the approved 
capital investment are given to approved enterprises. The grants are given for investments in the 
following areas: acquiring or upgrading technological equipment related to the supply chain; adopting 
advanced manufacturing technologies; improving the professional and technological abilities of the 
personnel to operate advanced equipment and systems; adopting innovative practices within the 
companies; improving efficiency in the internal consumption of recourses and raw mater ials.  
5. To Whom the Subsidy is provided  
Subsidies under this program are provided to companies that have 5 -250 employees in the field of 
activity for which the grant is given, and whose factory for which the assistance is provided has a 
maximum income of 20 0M NIS per year and at least 5 years of experience in the relevant industry. 
Subsidies under this program are provided only to companies that are not eligible for a grant under 
The Law for the Encouragement of Capital  Investment, 5719 - 1959.   
6. Budget/Expenditure :  
Actual annual disbursements, (in million USD)  
2021 15.63  
2022 22.03  
7. Duration  
Ongoing.   
8. Trade Effects  
In light of the scope and nature of the assistance, it is not possible to determine what, if any, trade 
effects may result from this program.   
15.4  Reducing  greenhouse gas emissions and improving energy efficiency program  
1. The Authority Responsible for the Subsidy  
The Authorit y for Investments and Development of the Industry and Economy at the Ministry of 
Economy and Industry  
2. Legal basis  
Directives of the Director General and Government decisions  G/SCM/N/401/ISR  
 
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  3. Policy Objective and/or Purpose  
The purpose of the program is to encourage investments in energy efficiency projects and reduce 
greenhouse gas emissions.  
4. Form of the Subsidy  
Grants are given for the costs of preliminary planning of energy efficiency project, expenses for the 
purchase an d installation of equipment and machinery, and technologies required to upgrade or 
replace existing technologies.  Each entity can apply for a grant of 20% of its investment in the 
project, and up to NIS 3 million on a calendar year (in some cases up to NIS  6 million for  an Energy 
Service Company (ESCO) ).  
5. To Whom the Subsidy is provided  
The subsidy is provided to an entity that owns or has the rights for at least 5 years lease over a plot 
of land and wishes to carry out an energy efficiency project , or to an Energy Service Company (ESCO) 
that has a license from the Ministry of Energy .  
The entity annual turnover should not exceed  NIS 400 million. This condition does not apply to 
municipalities, education institutions and hospitals that are not state owned a nd to anyone who 
applied for a grant to commercial installation of new technology that constitute at least 51% of the 
investment in the project .  
6. Budget/Expenditure  
Actual annual disbursements (in million USD):  
2021 0 
2022 27.34  
7. Duration  
Ongoing . 
8. Trade Effects  
The subsidy is provided mainly to companies in disadvantaged geographic areas of the country and 
was designed to encourage gas consumption in the industrial sector and therefore its effect on 
trade, if any, is very limited.  
16  OTHER FORMS  OF SUB SIDIES  
16.1  Cost of Land Development  
1. The Authority Responsible for the Subsidy  
Industrial Zones Administration, at the Ministry  of Economy and Industry . 
2. Legal Basis  
Government decisions.  
3. Policy Objective and/or Purpose  
Participation in the cost of land developm ent in industrial areas in the disadvantaged geographic 
areas , as a means of encouraging enterprises to locate in those areas. Land development includes 
inter alia  dirt work, access roads  and lights.  G/SCM/N/401/ISR  
 
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  4. To Whom the Subsidy is Provided  
Enterprises establishing their factories in a disadvantaged geographic area in accordance with the 
Law of Encouragement of Investment Capital, in land that was developed by the Ministry of Economy 
and Industry, which received approval of allocation of land with an exe mption from tender , from the 
authority responsible for allocation of land.  
5. Form of Subsidy  
Participation in the cost of land development varies from 30 percent up to 90  percent, according to 
several parameters, mainly the distance from the central part of  Israel, past data on land demand 
for industry and social -economic rating of the municipality.  
6. Budget/Expenditure  
Actual annual disbursements (in million USD):  
2021 6.65 
2022 22.05  
7. Duration  
Ongoing.   
8. Trade Effects  
The program provides participation of the Government in the development of basic infrastructure 
(land development), therefore the program has no trade effects.   
16.2  Eilat Free Trade  Zone  
1. The Authority Responsible for the Subsidy  
The Ministry of Finance.   
2. Legal Basis  
Eilat Free Tra de Zone Law - 1985.  
3. Purpose of the program  
The purpose of the program is to encourage the development of the city of Eilat, located at Israel's 
most Southern border.  
4. Form of the Subsidy  
Several types of tax concessions:  
Most products (imported or domestically produced) purchased in Eilat are exempt from value -added 
tax. This tax benefit is available to Eilat residents and companies, for products consumed in Eilat.  
Employers receive tax refunds for employees of up to 2 0% of gross wages paid to emplo yees.  
5. To Whom the Subsidy is Provided  
The tax concessions are granted to Eilat residents and companies located in Eilat.  
6. Budget/Expenditure  
Data not available.   G/SCM/N/401/ISR  
 
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  7. Trade Effects  
It is not possible to estimate what, if any, trade effects may result from the use of this program.  
16.3  Free Port Zone  
1. Authority Responsible for the Subsidy  
Ministry of Finance and Ministry of Transportation.   
2. Legal Basis  
Free Port Zone Law - 1969.   
3. Purpose of the program  
The objective is to promote the development of the port city of Eilat at Israel's most Southern border.  
4. To Whom the Subsidy is provided  
Enterprises located in the Free Port Zone of Eilat.   
5. Form of the Subsidy  
Various forms of tax incentives including, inter alia : 
(1) Enterprises in zone A (like Eilat) are entitled to redu ction in  income taxes to 9% in 
2014-2016;  
(2) A tax of 1 5% on dividends paid out of the above income with no stipulated time limit;  
6. Budget/Expenditure  
Data not available.   
7. Trade Effects  
It is not possible to estimate what, if any, trade effects may result from the use of this program.   
16.4  Fisheries - Waiver  of excise tax on fuel  
1. Authority Responsible for the Subsidy  
Israel Tax Authority.  
2. Legal Basis  
2005 Decree on Excise Tax on Fuel (Waiver and Restitution  ([unofficial translation].  
Under the decree, applications can be submitted for a tax refund on diesel. Eligibility for a refund is 
on the tax paid by those entitled for diesel used by fishing trawlers as specified in the Addendum to 
the Excise Order on Fuel (Waiver and Restitution) . 
3. Purpose o f the program  
Excise tax on fuel is intended to reduce fuel consumption, while usage of fuel as an input factor for 
fisheries is exempt.  
4. To Whom the Subsidy is Provided  
The subsidy is provided to licenced trawler s. G/SCM/N/401/ISR  
 
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  5. Form of the Subsidy  
Excise tax restitution.  
6. Budget/Expenditure  
Actual annual disbursements (in million  USD):  
2021 0.76 
2022 0.5 
7. Duration  
Ongoing.   
8. Trade Effects  
There are no trade effects.  
 
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