New Exposure for Litigation in Israel | July 2019

New Exposure for Litigation in Israel

Non-Israeli companies with no direct operations in Israel are now exposed to a greater risk of litigation in Israel due to a new Israeli regulation regarding extraterritorial service of process.

As part of a general reform in the Israeli Civil Procedure Regulations, a plaintiff may request court approval to serve a lawsuit outside of Israel in cases in which damages alone occurred in Israel.  No act or omission by a defendant must occur in Israel in order for an Israeli court to impose its jurisdiction. Rather, it is now sufficient that the defendant be involved in international commerce or provide services internationally and could have foreseen that damages would occur in Israel in order to be subject to Israeli court jurisdiction.

This reform creates increased risk of litigation, including class action lawsuits, against non-Israeli companies whose products or services reach the Israeli consumer indirectly as well as e-commerce companies that target Israeli consumers. Companies that operate in Israel or target Israeli customers, even if they have no direct operations in Israel, should consider taking steps in order to reduce their exposure to class actions and other litigation in Israel.