ISRAEL Law and Practice Contributed by: Barak Platt, Micki Shapira and Moshe Pasker, Arnon, Tadmor-Levy
The nexus requirement can be met by fulfilling any of the following conditions: • owning more than 25% (directly or indirectly) of the voting rights, rights to appoint direc - tors, dividend rights or outstanding shares in an Israeli entity; • having a registered office or being incorpo - rated in Israel; or • operating a place of business in Israel, either through direct activity (such as a branch office or local employees) or by exercis - ing decisive influence over the commercial decisions of a local agent, representative or distributor. “Merger of companies” which meets the nexus requirement is reportable if any of the following thresholds are met: • the combined local turnover of the merging parties, along with the individual local turno - ver of at least two of the merging parties in Israel, exceeds certain thresholds (currently, ILS414,010,000 for the combined turnover and ILS22,510,000 for each party); • a party to the merger transaction is a monop - oly, defined as an entity that holds a market share exceeding 50% in any defined market in Israel, including any segment or geographi - cal area in which the parties operate in Israel. This threshold can also be triggered by mar - kets unrelated to the transaction; or • as a result of the merger transaction, the combined market share of the parties will exceed 50% at any level of the supply chain of any relevant market in Israel, including any segment or geographical area in which the parties operate. The nexus and filing requirements are assessed on a group level, meaning that they encompass
all entities that are either controlling or con - trolled by the merging party, as well as any enti - ties under the control of the ultimate controlling entity, whether directly or indirectly. Control is
defined as holding more than 50%. 2.5 Labour Law Regulations
The Work and Rest Hours Law, 1951, which applies to employees in Israel (unless a specific exemption applies), requires overtime payments if an employee exceeds daily and weekly hour limits. Additionally, Israeli law requires Israeli employ - ers to monitor and record attendance as well as working hours and overtime of employees. Fail - ure to properly record work hours may expose the company to claims by employees that the actual overtime performed by the employees exceeds the number of hours covered by the global overtime compensation. Companies at times do not correctly treat certain components of compensation as salary (notably commis - sions), as required for the purposes of severance pay obligations. As a general rule, Israeli law requires employers to pay severance pay to their employees upon termination of employment by the employer. The amount of severance pay is equal to one month of the current base salary, multiplied by the num - ber of years of employment. Under Section 14 of the Severance Pay Law, 1963 ( “Section 14” ), and a general permit issued by the Minister of Industry, Trade and Labour, an employer and employee may agree to limit the employer’s liability for severance pay to those amounts accrued in a severance pay insurance policy, provided that certain pre-conditions are met. The employer must undertake to release the accruals upon cessation of employment in
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