Doing Business with an Israeli Company or Investor: A Practical Guide for the Foreign Partner - Checking the Company, Signing Authority, Contracts, Tax and Payments

This guide is written for business owners and investors from Romania, from other EU countries and from Russian-speaking countries who work with an Israeli company, receive investment from an Israeli investor or set up a joint venture with one. It explains how Israeli companies are structured, how to check them, what matters in the contract and how payments and tax work between Israel and your country. The information is current as of November 2026 and is general; every transaction requires review by a lawyer in your country and in Israel.

1How is an Israeli company structured?

Most private companies in Israel are limited liability companies, whose names include the Hebrew abbreviation "Ba'am" (in English, Ltd). They are incorporated under the Companies Law, 5759-1999, and registered with the Registrar of Companies at the Israeli Corporations Authority in the Ministry of Justice. Each company has a unique company number.

2How do you check an Israeli company online?

Through the Registrar of Companies information service on the Ministry of Justice website (gov.il). Basic information on a company is available free of charge, and a full company extract can be ordered for a fee, in Hebrew and in English.

• Free basic information: name, company number and the company's status - active, in liquidation or struck off.
• Company extract: shareholders, directors, capital, registered charges and changes. An extended extract can be chosen.
• Charges: a charge registered over the company's assets appears in the extract, and indicates loans or guarantees.
• "Law-violating company": a company that has not paid its annual fee or filed reports may be flagged this way, and this is a warning sign.
• Beyond the Registrar: searching judgments, checking who actually makes decisions and checking links with controlling shareholders are done with the help of an Israeli lawyer.

3Who is authorised to sign on behalf of an Israeli company?

Whoever the company has authorised to do so under its articles and board resolutions. In practice, it is customary in Israel to request a confirmation of signing authority from the company's lawyer or accountant, setting out who is authorised to sign, in what combination and up to what amount.

• Ask for an up-to-date confirmation of signing authority, and a board resolution approving the specific transaction when it is a large one.
• Check that the signatory appears as an officer in the extract or is expressly authorised.
• When a signatory represents a private investor, ask for a certified power of attorney, and for a document from abroad - an apostille.
• In a transaction with a fund or limited partnership, check who the general partner is and who is authorised to bind it.

4What is important to know about Israeli contract law?

Israeli law is based on legislation, led by the Contracts (General Part) Law, 5733-1973, supplemented by Supreme Court case law. A central principle in it is the duty of good faith.

• Good faith in negotiations: under section 12 of the Contracts Law, a party that negotiated not in good faith may have to pay compensation, even if no contract was signed.
• Good faith in performance: under section 39, an obligation arising from a contract must be performed in a customary manner and in good faith.
• Oral contract: most commercial contracts have no formal requirement, but a real estate transaction in Israel requires a written document. In any case, a detailed written contract is the best protection.
• Remedies: the Contracts (Remedies for Breach of Contract) Law, 5731-1970, allows enforcement, rescission and damages, subject to conditions.
• Language: a contract in English is valid in Israel. When there are versions in several languages, state which version prevails.

5How do you draft the dispute resolution clause?

Expressly state the governing law, the forum and the language of the proceedings. Without such a clause, a dispute may begin with a costly argument over where to litigate.

Israel and Romania, like most European countries, are party to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. On commercial disputes in Romania see Commercial disputes and litigation in Romania.

6Is there a tax treaty between Israel and your country?

Israel has treaties for the avoidance of double taxation with many European countries, including Romania, Bulgaria, Greece, Italy and Portugal. The treaty with Romania was signed on June 15, 1997 and applies from January 1, 1999. There is no treaty with Cyprus. The list of treaties is published on the Israel Tax Authority website.

According to PwC (review of June 2026), the Israeli withholding rates on payments to a company resident in Romania under the treaty are: dividends 15%, interest 5% or 10%, and royalties 10%. Without a treaty, the rates under Israeli law are 25% or 30% on dividends, and 23% on interest and royalties. The rates are current as of November 2026.

7How do you receive payment from an Israeli company?

The Israeli company transfers the payment by bank transfer, and sometimes withholds tax from it at source. For a reduced treaty rate to be withheld, or for nothing to be withheld, approval from the Israel Tax Authority is usually required.

1. Agree in advance in the contract whether the amount is before or after withholding tax, and who bears the tax.
2. Prepare a tax residence certificate from the tax authority in your country; the Israeli party will use it in an application for a reduced rate.
3. The Israeli party applies for approval from the Israel Tax Authority for withholding at a reduced rate or for an exemption, depending on the type of payment.
4. Keep the withholding certificate issued by the Israeli company; it allows you to claim a credit in your country for the tax withheld in Israel.
5. Expect bank checks: banks in Israel and in your country may ask for a contract, an invoice and identification documents. See Transfer delays and source of funds.

8What is worth knowing about working with an Israeli party in practice?

There is no single "Israeli style"; different companies and investors work differently. However, there are some practical facts worth knowing:

• The working week: in Israel people usually work Sunday to Thursday, and Friday is a short working day or a day off. Plan meetings and payment dates accordingly.
• Holidays: the Hebrew holiday calendar changes from year to year; during the autumn holiday season and Passover there are many days when offices and banks are closed.
• Language: English is very common in business. Official documents with authorities in Israel are in Hebrew, and translation is sometimes required.
• Decisions and documentation: in any business culture it is worth summarising in writing decisions made in a conversation or message, and making sure they are carried into the contract.
• Independent advice: even when relations are good, each party should have its own lawyer.

9What to check before signing, and how we accompany it

Before signing, check the Israeli company at the Registrar of Companies, obtain a confirmation of signing authority, agree on the law and the forum, and coordinate with your tax adviser and with the Israeli party on withholding and the required approvals. Our office in Ness Ziona also works in Romanian, and assists foreign partners in checking the Israeli party, drafting and reviewing contracts and joint ventures under Israeli law, and coordinating with lawyers and accountants in your country. Meetings in Bucharest are possible by prior arrangement.

More on this topic: An Israeli company doing business in Romania · Israeli companies in Romania by the numbers · The Israel-Romania tax treaty · A joint venture agreement

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