ISRAEL Law and Practice Contributed by: Joseph Sprinzak and Rahel Rimon, J.SPRINZAK
arbitration according to the laws of Israel and whether recognition and enforcement of the award is consistent with Israeli public policy. 6.4 Arrest of Vessels Subject to Foreign Arbitration or Jurisdiction The Admiralty Court has jurisdiction to order the attachment of a vessel as security for foreign judicial or arbitral proceedings, upon provision of prima facie evidence that the ship-owner will not be in a position to satisfy a judgment or arbitral award. Moreover, interim relief in the form of ship arrest or temporary attachment may be obtained before the foreign arbitration proceedings have been initiated (CA 102/88 Silver Goose Delica - tessen Ltd v Cent or SARL). 6.5 Domestic Arbitration Institutes There are a number of expert maritime lawyers and retired judges who specialise in handling maritime arbitrations. 6.6 Remedies Where Proceedings Are Commenced in Breach of Foreign Jurisdiction or Arbitration Clauses A defendant facing proceedings in breach of an exclusive foreign jurisdiction or arbitration clause may ask for a stay of the proceedings until judg - ment is rendered by a competent foreign tribu - nal. 7. Ship-Owners’ Income Tax Relief 7.1 Exemptions or Tax Reliefs on the Income of Ship-Owners’ Companies Israeli shipping companies are subject to the same corporate tax regimes as other compa - nies in Israel, and are not subject to any special regulation or legislation. Incentives are, how - ever, provided to shipping companies in terms
of amortisation, and seafarers are provided with incentives in terms of income tax deductions.
8. Implications of Non- Performance, the IMO 2020, Trade Sanctions and the War in Ukraine 8.1 Force Majeure and Frustration Israeli legislation does not contain a definition of the term “force majeure”. Accordingly, when considering non-performance of contractual obligations, the Israeli courts always look first at the construction of the contract and the inten - tion of the parties. Force majeure in shipping contracts usually relates to wars and hostilities, natural disasters such as hurricanes and other matters outside the control of the parties. When considering the construction of the clause, the courts will also take into account the foresee - ability of the event. Even if a particular event does not fall within the definition of force majeure, it is possible that in the appropriate circumstances the court would consider the shipping contract to be frustrated. In this regard, the Israeli courts have held that “war” per se in Israel does not frustrate a con - tract governed by Israeli law. It is highly likely that the on-going Russia-Ukraine war would also not be considered a frustrating event by the Israeli court in relation to a contract governed by Israeli law, in light of the foreseeability of the hostile activities. Section 18(a) of the Israeli Con - tracts (Remedies for Breach of Contracts) Law 1970 provides that, where the breach of contract is the result of circumstances that at the time of making the contract the person in breach did not or could not know or foresee, and which they could not have avoided, and the performance of the contract under these circumstances is impossible or fundamentally different from what
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