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Israel’s Planned National Committee on Foreign Investments Up for Rediscussion

Israel’s Planned National Committee on Foreign Investments Up for Rediscussion

The amended proposal will be discussed by the cabinet Sunday after the ministries raised objections to the initial proposal submitted by Israel’s National Security Council

Omri Milman  :  2019-03-13T13:01:29..
The Israeli National Security Council’s (NSC) proposal for a committee intended to oversee foreign investments in Israel will be going up for cabinet discussion again on Sunday, following some revisions, according to three people familiar with the matter who spoke with Calcalist on condition of anonymity.

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Earlier this month, Calcalist reported that the NSC is interested in forming and heading such a committee, with majority representation of Israeli security entities, in a format that will essentially give the NSC veto power over investments with strategic impact.

The Israeli parliament. Photo: Amit Shabi The Israeli parliament. Photo: Amit Shabi The Israeli parliament. Photo: Amit Shabi

The proposal, which went up for cabinet discussion but not for vote, drew objections from Israel's ministries, which feared such a scheme will not only create additional regulatory burdens but also tip the discussion too heavily towards the security angle.

The new proposal, the people familiar with the matter said, will make the committee's involvement voluntary, meaning regulators could choose whether to involve the new authority or not when considering finance or infrastructure-related investments. It should be noted that the NSC currently already has an unofficial authority to raise red flags concerning such deals regardless of whether its opinion was solicited.

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Still up for debate is the composition of the committee. The Ministry of Finance is against a security-related majority, the people said, fearing such a composition will harm Israel's attractiveness to foreign investors.

Another clause included in the original proposal that currently seems to be off the table is the NSC's interest in extending the committee's authority to other industry domains, such as tech. Currently rather unregulated, Israeli tech is widely considered to be the local economy's growth engine.
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