Selling and Buying Shares of Israeli Limited Liability Company

Selling and buying shares of an Israeli limited liability company requires two legal forms:

1.      Deed of transfer of shares.

The deed is a short form stating the details of the company, the parties and the transferred shares. The deed is signed by the transferor, the receiver and a witness for each of the above (i.e. a Notary is required). The deed has to be provided to the company's secretary to give effect to the transfer. The parties are not obligated to file the deed to the Israeli Registrar of Companies, therefore it can be in English.

2.      Notice of Share Transfer in a Private Company.

The notice is a mandatory form required under Israeli  COMPANIES REGULATIONS (REPORTING, PARTICULARS OF REGISTRATION AND FORMS) 5760-1999 that has to be filed to the Israeli Registrar of Companies in order to register the transfer. The notice must be filed in Hebrew signed by a registereddirector of the company.

If the director or a person shareholder does not have an Israel ID card the notice has to state the number of his passport and the country in which it was issued, and to the first report about him shall be attached a true copy of his passport certified by one of the following:

a)      An Israeli consular delegate (for example, the delegate in the Israeli embassy is Warsaw).

b)      A notary competent in the state in which the passport was issued;

c)      An Israeli attorney with an attorney's license in Israel;

d)      A qualified notary in the country of residence of the individual who is not an Israel resident.

If the shareholder is a body corporate, then to the first report in respect of that body corporate shall be attached a true copy of the certificate of incorporation or registration of the body corporate in the state in which it was incorporated, together with certification of the existence of the body corporate at that time, certified according to sub-sections (a) to (d) above, together with a Hebrew or English translation (a Hebrew translation is preferred) approved by a notary and certified as aforesaid.

Note that the articles of association of the company may include additional conditions to any purchase or sale of its shares (such as approval by the board of directors, limitation period, right of first refusal and tag along). Therefore, a review of the AOA for any conditions applying to purchase or sale of shares is always required.

Please don't hesitate to contact us for additional information.