Registration for Foreign NGOs Operating in Israel
Registration for foreign NGOs (non governmental organizations) operating in Israel is mandatory by Israeli law. Every NGO must register with the Registrar of Charitable Trust, aka the Registrar of Public Endowments, as a foreign company for the benefit of the public. The requirement is stated within section 345 (33) of the Companies Law, 1999.
Despite this requirement, many religious institutions who have been operating in Israel for centuries (some of which own a significant amount of property in Israel), and large international humanitarian NGOs, are currently not registered with the Registrar of Public Endowments.
Many public benefit companies have registered as such with the Registrar of Companies within the Ministry of Justice prior to the 2007 implementation of Amendment 6 to the Companies Law. Before that time, public benefit companies were practically unregulated. Hereinafter, their legal management requirements were similar to those of Israeli NGO associations (amutot). More information on the subject can be found in the linked article.
Many of these companies for the benefit of the public are still recognized as an institution for public benefit (“Malkar”) by the Israeli Tax Authorities. However, said recognition might theoretically be rescinded at will. One possible immediate result is considerable difficulty in the ongoing management of bank accounts.
As this article will demonstrate, continued lack of registration is improper and carries immense risk to the NGO in question.
A Foreign NGO in Israel Must Register with the Registrar of Public Endowments:
Any entity which has a place of business in Israel, acts for public purposes, and forbids the distribution of profits, is subject to all the relevant sub sections of section 345 to the Companies Law, which deal with companies for the benefit of the public.
According to section 346 to the Companies Law, a foreign company will not conduct business in Israel without proper registration.
According to section 345 (b) and (c), a company which has public objectives, and which forbids distribution of profits within its bylaws must register as such within the Registrar of Public Endowments.
Section 345 (33) to the Companies Law states:
“(a) If the bylaws of a foreign company, which has a place of business in Israel, prescribe only public purposes and if it’s bylaws forbid the distribution of profits (in this Law: “foreign public benefit company”), then the provisions of this Law on a public benefit company shall apply, mutatis mutandis and with changes that the Minister may prescribe in regulations”.
Special Exemption for Foreign NGOs from Israeli Proper Management Regulations:
Due to the fact that many of the foreign NGOs operating in Israel are already properly regulated by a set of laws and regulations within their own countries, and due to the fact that these sets of laws, and regulations, are no less worthy that those which exist in the State of Israel, the Minister of Justice may exempt a foreign NGO in Israel, upon request, from the relevant provisions of section 345 of the Companies law, in full or in part
Below is the wording of section 345 (33) to the Companies Law in this regard:
“(b) The Minister may prescribe by Order, after consultation with the Registrar of Public Endowments, that all or some of the provisions of this Law not apply to a certain foreign public benefit company, or that they shall apply with changes that he shall prescribe, and that if he is satisfied that there are circumstances that justify this, having taken into consideration, inter alia, the Laws of the place where the company was incorporated or the provisions of the foreign Law that apply to its activity in Israel as a foreign public benefit company, the applicability in its respect of another statute in Israel, and to the source of the company’s assets; the Minister may, in regulations, prescribe provisions as aforesaid for categories of foreign public benefit companies”.
Registration for Foreign NGOs Operating in Israel – Requirements
In order to register a new or existing foreign company for the benefit of the public, the following documents must be submitted to the Ministry of Justice:
- A notarized translation into Hebrew of the Certificate of Incorporation + Apostille stamp;
- A notarized translation of Articles of Association + Apostille stamp;
- Certificate of Status from the country of origin (a good standing certificate) which declares that the company is still existing and active – translated into Hebrew, dated no later than six months back;
- Power of attorney for a representative in Israel;
- A notice specifying the name and address of a person residing in Israel authorized to receive court documents and notices on behalf of the company;
- The company’s list of directors. The list will include passport numbers (for foreign residents) and / or Israeli ID numbers;
- Confirmation of payment of the relevant registration fee.
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