ISRAEL Law and Practice Contributed by: Joseph Sprinzak and Rahel Rimon, J.SPRINZAK
1.7 Ship Ownership and Mortgages Registry According to Section 109 of the Shipping (Vessels) Law – 1960, the Vessels Registry and all documents filed with the Registrar in connection with the registra - tion, cancellation of registration or other transaction in connection with a vessel shall be open for inspec - tion by any person. Additionally, under the Freedom of Information Law – 1999, every Israeli citizen or resi - dent has the right to obtain information from a public authority in accordance with the provisions of the law. The public authority is not under any obligation to pro - vide information that is a commercial or professional secret, or which has economic value; information on commercial or professional matters connected with a person’s business; or information that may infringe a person’s privacy. In practice, the Registrar will provide access to all entries (registrations, mortgages, charges, pledges); however, access will not be provided to the underly - ing documents. The fee for an application to the SPA to inspect or verify any entry in the Registry of Vessels currently stands at ILS476. Ship financing in Israel is generally structured as tradi - tional bank debt financing. Equity is typically provided by owners through ordinary share capital or straight - forward shareholder loans, while complex equity or hybrid financing structures are uncommon. The primary form of security is a ship mortgage. A ship mortgage must be in writing and registered with the Israeli Registrar of Vessels to be valid and enforceable. It must identify the secured obligations and the loan amount or maximum secured amount. In the event of default, the mortgage may be enforced through arrest and judicial sale of the vessel by the Israeli Admiralty Court, subject to statutory maritime liens and preferred maritime claims, including crew wages and salvage. 2. Ship Finance and Leasing 2.1 Ship Loan Finance
In practice, lenders usually require a broader security package in addition to the ship mortgage, commonly including pledges over the shares of the ship-owning company, assignments of earnings and insurances, charges over bank accounts and corporate or per - sonal guarantees. Ship finance transactions most commonly relate to the acquisition, construction or refinancing of vessels owned or controlled by Israeli interests or registered under the Israeli flag. In financings involving foreign- flagged vessels, lenders often require parallel security under the relevant flag state law. 2.2 Ship Leasing Ship leasing and sale and leaseback transactions are used to a limited extent in Israel. However, publicly available information does not indicate a market-wide shift away from traditional secured bank lending. These structures function primarily as complemen - tary financing tools reflecting global shipping finance trends, rather than as domestically driven alternatives to bank debt. Israeli law does not recognise ship leasing as a distinct statutory financing regime, and there is no developed body of Israeli case law addressing the enforcement of ship lease defaults as such. Leasing and sale and leaseback transactions involving Israeli operators are typically structured with foreign lessors and financi - ers and governed by foreign law. As a result, issues of default and enforcement in such transactions are generally determined under the applicable foreign law, while Israeli law remains relevant mainly in relation to vessel registration, flag state matters and procedural enforcement where applicable. 3. Marine Casualties and Owners’ Liability 3.1 International Conventions: Pollution and Wreck Removal Israel is a party to the following International Conven - tions relating to pollution:
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