Insolvency and Economic Rehabilitation Law, 5778-2018
חוק חדלות פירעון ושיקום כלכלי, תשע"ח-2018
Published: 2018-03-15Consolidated Hebrew text as of 2026-08-02 · Last amended 2026-07-28✓ Amendment status checked against the Knesset legislation record on 2026-09-17
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Chapter II: Order Opening Proceedings on the Application of an Individual whose Total Debts Exceed NIS 176,923.12
The Individual's Application to the Official Receiver§
104.
(a)The individual may submit to the Official Receiver an application for an order opening proceedings (in this Part – an individual's application), if all of the following conditions are met:
(1)the individual is in insolvency or the order will assist in preventing the individual's insolvency;
(2)the individual's total debts exceed NIS 176,923.12.
(b)The individual shall attach to the application the following:
(1)a declaration, in a form prescribed by the Minister, that the conditions for submitting the application are met;
(2)a report containing the following particulars in respect of the two years preceding the date of submission of the application, drawn up in a form prescribed by the Minister and verified by a declaration supported by documents:
(a)particulars regarding the individual's assets, income, expenditure, debts and liabilities, including particulars of the individual's bank accounts, securities given by the individual, and the identity of the individual's creditors and of persons who owe a debt to the individual;
(b)claims and collection proceedings that the individual is conducting or that are being conducted against the individual;
(c)the individual's profession and education;
(d)particulars known to the individual regarding the assets, income, expenditure, debts and liabilities of the individual's spouse, minor children and adult children whose maintenance is the individual's responsibility, including particulars of the individual's spouse's bank accounts;
(3)a waiver of confidentiality and consent to the transfer of information on the following matters and from the following sources:
(a)information regarding the individual's address, assets, debts, level of income and sources of income – from any source, including a public body as defined in the Privacy Protection Law, 5741-1981, but excluding a body listed in Column A of Part 1 of the First Schedule and the Israel Tax Authority;
(b)information regarding the individual's financial situation and regarding the individual's exits from and entries into Israel – from any source listed in Column A of Part 1 of the First Schedule in respect of the matters detailed in Column B alongside it.
(c)In the report referred to in subsection (b)(2), the individual may designate certain particulars of information as particulars of information containing sensitive personal information concerning the individual that the individual requests not be made available for inspection by creditors, and the provisions of section 107(b) shall apply in this regard.
(d)The individual's application shall be submitted to the Official Receiver in the district in which the individual resides or in which the individual's principal place of business is located or in which the individual's assets are located, and in the absence of such a district – in Jerusalem, and it may also be submitted online; for this purpose, "district" – in accordance with the jurisdictional areas of the District Courts prescribed by the Minister of Justice under section 33 of the Courts Law [Consolidated Version], 5744-1984.
The Official Receiver's Decision on an Individual's Application§
105.
(a)If the Official Receiver finds that the conditions listed in section 104(a) are met, the Official Receiver shall, within 30 days of the date of submission of the individual's application, issue an order opening proceedings.
(b)For the purpose of a decision under subsection (a), the Official Receiver may examine the report submitted by the individual under section 104(b)(2) and receive information, including online, from the sources listed in section 104(b)(3), in accordance with the provisions of that section.
(c)If the Official Receiver considers that the information available is insufficient to reach a decision on the individual's application, the Official Receiver may require the individual to provide additional information necessary for that purpose or summon the individual to a hearing before the Official Receiver; if the Official Receiver has so required, the Official Receiver shall give a decision within 30 days of the date of receipt of the information or the conclusion of the hearing.
Publication of Notice of the Grant of the Order and Dispatch of a Copy§
106.
(a)Notice of the grant of an order opening proceedings in respect of an individual shall be published to the public in the manner and at the time prescribed by the Minister.
(b)The Official Receiver shall send a copy of the order opening proceedings to the individual and to the creditors whose identity is known to the Official Receiver.
Inspection of the Order and the Individual's Application§
107.
(a)Where an order opening proceedings has been issued under section 105, a creditor may inspect the order and, subject to the provisions of subsection (b), the individual's application and the parts of the report and documents relevant to the individual's affairs that were attached to the application, and copy them.
(b)If the individual has indicated that certain particulars of information in the report submitted contain sensitive personal information concerning the individual under section 104(c), the Official Receiver shall make them available for inspection by creditors only if satisfied that this is necessary for the creditor for the purpose of submitting an application for the cancellation of the order opening proceedings and after having taken into account the harm to privacy entailed thereby, and the Official Receiver may transfer only part of the information or make its transfer subject to conditions.
(c)The Official Receiver may permit a creditor to inspect additional parts of the report and the documents attached to the individual's application that relate to the affairs of the individual's spouse or children, and to copy them, if satisfied that inspection of those parts is necessary for the creditor for the purpose of submitting an application for the cancellation of the order opening proceedings and after having taken into account the harm to privacy entailed thereby.
(d)The Official Receiver shall establish provisions regarding the right of inspection under this section.
Application for Cancellation of an Order Opening Proceedings§
108.
(a)A person who considers himself or herself harmed by the grant of an order opening proceedings may submit to the court, within 45 days of the date of publication of the notice of the grant of the order under section 106, an application for its cancellation; the applicant shall send a copy of the application to the Official Receiver.
(b)Where an application for the cancellation of an order opening proceedings has been submitted, the court shall decide whether to suspend the validity of the order or its consequences, in whole or in part, pending a decision on the application.
(c)A hearing on an application for the cancellation of an order opening proceedings shall be held as soon as possible; if the court decided to suspend the validity of the order or its consequences ex parte, the court shall hold a hearing inter partes as soon as possible, and no later than 14 days from the date of the decision.
(d)If the court is satisfied that an application for the cancellation of an order opening proceedings was submitted in bad faith, the court may, within the framework of its costs order, order the applicant to pay legal costs or double legal costs, costs for the benefit of the State Treasury, or both.
(e)The Minister may prescribe provisions regarding the submission of an application for the cancellation of an order opening proceedings, including regarding the particulars to be included in it and the manner of its service.
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Contact Us →Chapter III: Order Opening Proceedings on the Application of a Creditor or the Attorney General
A Creditor's Application to the Court§
109.
(a)A creditor may submit to the court an application for an order opening proceedings (in this Part – a creditor's application), if the individual is in insolvency; proof of the individual's insolvency may be by means of the presumption in section 110.
(b)A creditor of a debt whose due date has not yet arrived is not entitled to submit an application for an order opening proceedings, unless one of the following applies:
(1)the individual is acting with the intention of defrauding the individual's creditors;
(2)the individual is acting to reduce the individual's assets with the intention of concealing them from creditors;
(3)the individual will be unable to repay the debt, provided that the due date of the debt falls within six months of the date of submission of the application.
Presumption of Insolvency in a Creditor's Application§
110.
(a)For the purpose of a creditor's application, the individual is presumed to be in insolvency if one of the following applies (in this section – presumption of insolvency):
(1)the creditor delivered to the individual a demand for payment of a debt exceeding NIS 88,461.56, drawn up in a form prescribed by the Minister, in which the creditor stated that if the debt is not paid by the date specified in the demand, the creditor intends to submit an application for the opening of proceedings, and the debt was not paid within 45 days of the date of delivery of the demand, provided that all of the following are met:
(a)there is no bona fide dispute as to the debt and the individual has no right of set-off or other ground that would justify non-payment of the debt;
(b)the creditor submitted the application for an order opening proceedings within three months of the date on which the creditor delivered the payment demand to the individual;
(2)the creditor served on the individual a warning under section 7 of the Execution Law or a payment demand under section 4 of the Tax (Collection) Ordinance, for payment of a debt exceeding NIS 88,461.56, and the debt was not paid within the period specified in the warning or demand;
(3)the court issued a judgment ordering the individual to pay the applying creditor an amount exceeding NIS 88,461.56 and the judgment was not complied with, in whole or in part, within 30 days of the date of its service on the individual or of another date specified in the judgment, whichever is later, provided that if the judgment was partially complied with – the amount remaining to be paid exceeds NIS 88,461.56;
(4)the Labour Court issued a judgment ordering the individual to pay the applying creditor an amount exceeding NIS 11,794.87 and the judgment was not complied with, in whole or in part, within 30 days of the date of its service on the individual or of another date specified in the judgment, whichever is later, provided that if the judgment was partially complied with – the amount remaining to be paid exceeds NIS 11,794.87.
(b)In a creditor's application based on a presumption of insolvency, the creditor shall specify whether the creditor has taken collection proceedings and what proceedings were taken, and why collection proceedings are insufficient to bring about the collection of the debt.
(c)The presumption of insolvency is rebuttable by the individual if the individual proves that the non-payment of the debt does not stem from the individual's insolvency.
(d)
(1)In calculating whether a debt exceeds NIS 88,461.56, for the purpose of the satisfaction of a condition in paragraphs (1), (2) and (3) of subsection (a), several debts originating from one or more of those paragraphs may be taken into account, whether of the same creditor or of several creditors;
(2)In calculating whether a debt exceeds NIS 11,794.87, for the purpose of the satisfaction of the condition in paragraph (4) of subsection (a), several debts may be taken into account, whether of the same creditor or of several creditors.
Attachment of Documents to the Application for an Order Opening Proceedings§
111.
The creditor shall attach to the application for an order opening proceedings a declaration verifying the facts on which the application is based; the Minister may prescribe additional documents that the creditor is required to attach to the application.
Dispatch of a Copy of the Application for an Order Opening Proceedings§
112.
A creditor submitting an application for an order opening proceedings shall serve a copy of it on the individual and on the Official Receiver immediately upon its submission.
Submission of an Objection to an Application for an Order Opening Proceedings§
113.
(a)A person liable to be harmed by the grant of an order opening proceedings may submit to the court an objection to the creditor's application.
(b)The Minister shall prescribe provisions regarding the submission of the objection, including regarding the particulars to be included in it, the time for its submission and the manner of its service.
Liability for Submission of a Creditor's Application in Bad Faith§
114.
If the court is satisfied that the creditor's application was submitted in bad faith, the court may, within the framework of its costs order, order the applicant to pay legal costs or double legal costs, costs for the benefit of the State Treasury, or both.
Hearing of a Creditor's Application§
115.
(a)A hearing on a creditor's application and the objections submitted thereto shall be held as soon as possible.
(b)The court may, on its own initiative or at the request of the creditor or the Official Receiver, summon the individual to testify and require the individual to present documents before the court.
(c)The court shall give its decision on the creditor's application as soon as possible after the hearing of the application and the objections thereto.
The Court's Decision on a Creditor's Application§
116.
(a)If the court finds that the conditions listed in section 109 are met, the court shall issue an order opening proceedings.
(b)Notwithstanding the provisions of subsection (a), the court may dismiss the application for an order opening proceedings if it finds that the issuance of the order in itself will harm the possibility of bringing about the economic rehabilitation of the individual; for this purpose the court shall examine, inter alia, whether dismissal of the application will harm creditors and also the individual's overall economic capacity.
(c)Where an order opening proceedings has been issued on a creditor's application, the provisions of sections 106 and 107 shall apply regarding the publication of notice of the grant of the order, the dispatch of a copy thereof and inspection thereof.
Report on the Individual's Financial Situation§
117.
(a)An individual in respect of whom an order opening proceedings has been issued on a creditor's application shall submit to the trustee, within 21 days of the date of the grant of the order, a report on the individual's financial situation in the two years preceding the date of its submission; the report shall be submitted in a form prescribed by the Minister and verified by a declaration supported by documents, and shall set out all the particulars listed in section 104(b)(2); the Official Receiver may extend the period for submission of the report if the Official Receiver finds that this is justified in the circumstances of the matter.
(b)In a report under subsection (a), the individual may designate certain particulars of information as particulars of information containing sensitive personal information concerning the individual that the individual requests not be made available for inspection by creditors.
(c)A creditor may inspect the report under subsection (a) submitted by the individual and the documents attached to it and copy them; if the individual has indicated that certain particulars of information in the report submitted contain sensitive personal information concerning the individual, the trustee shall make them available for inspection by creditors only if satisfied that this is necessary for the creditor, after having taken into account the harm to privacy entailed thereby, and having given the individual the opportunity to state the individual's position regarding the transfer of the information, and the trustee may transfer only part of the information or make its transfer subject to conditions.
(d)The Official Receiver shall establish provisions regarding the right of inspection under this section.
The Attorney General's Application for an Order Opening Proceedings§
118.
The Attorney General may submit to the court an application for an order opening proceedings if the Attorney General finds that there is a public interest in doing so; the provisions of this Part applicable to an application for an order opening proceedings submitted by a creditor shall apply to such an application.
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