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Apr 21, 2016

Client Update: Decided – To Facilitate Cyber Export Controls as Much as Possible

This past week Israeli Prime Minister Benjamin Netanyahu approved the recommendation of the Israeli Cyber Bureau and the Ministry of Defense to abandon the idea to promote a new Israeli cyber export bill.

This came after strong industry opposition, including a large conference held at HFN with governmental and industry representatives, as well as various written submissions to the government. We are given to understand that the message was clearly received by the government, which recognized that the proposed reform could have had a severe negative impact on the Israeli cyber industry, particularly as Israel would have become the country with the most onerous regulatory regime in the cyber field.

The formal Prime Minister's Office announcement included the following decisions:

  • The supervision of cyber products and systems will continue to be as per the Dual-Use Wassenaar Agreement (rather than the broad wording suggested in the bill);
  • The Israeli government will closely monitor any changes in the Wassenaar regime (we assume this is a reference to the anticipated US-led discussions on the scope of the Wassenaar cyber provisions);
  • The Ministry of Defense (DECA) will continue to supervise exports of cyber systems for governmental/defense users and uses; whilst cyber systems with a "civil" nature will be supervised by the Ministry of Economy together with the Israeli Cyber Bureau;
  • The government will issue "clarifications" on specific definitions and other guidelines, including possible exemptions from any duty to obtain export licenses (e.g. exemptions related to destination countries, and by types of product, technology or service). This process will include regular consultations with the cyber industry.

To read an article on the matter, click here.

For the PMO's message on the update (Hebrew), click here.

We would particularly like to congratulate the Israeli government officials on their decision, and the proper way in which the dialogue was conducted with the cyber industry.