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OrdinanceCorporate & Business

Partnerships Ordinance [New Version], 5735-1975

פקודת השותפויות [נוסח חדש], תשל"ה-1975

Published: 1975-07-07Consolidated Hebrew text as of 2023-09-18 · Last amended 2015-02-23✓ Amendment status checked against the Knesset legislation record on 2026-09-15
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Unofficial English translation — for reference only. It may contain errors or omissions and cannot be relied on as a legal text. Only the Hebrew text published in Reshumot is legally binding.More

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Despite these checks, it may contain errors, omissions, or imprecise renderings of legal terminology and cross-references, and it may not yet reflect the latest amendments. It cannot be relied upon as a legal text.

The Hebrew text as published in Reshumot (ספר החוקים) and on the Knesset website is the sole authoritative and legally binding version. In any discrepancy, the Hebrew text prevails.

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Section J: Miscellaneous Provisions

Capital Maintenance and Distribution§
65bb.
(a)The provisions under Sections A through D of Chapter II in Part 7 of the Companies Law shall apply to the public limited partnership, with the necessary modifications and the following modifications: everywhere, instead of "company" read "public limited partnership", instead of "shares" read "participation units", and instead of "articles" read "partnership regulations".
(b)Nothing in the provisions applicable under subsection (a), with respect to the authority of the board of directors to distribute profits, shall derogate from the obligation of the public limited partnership to distribute its profits in accordance with what is prescribed in the partnership regulations, provided that the board of directors of the general partner company has been given an adequate opportunity to determine, before the distribution is carried out, that the distribution is not a prohibited distribution within its meaning in section 301 of the Companies Law.
(c)The Minister may prescribe provisions with respect to the obligation of the public limited partnership to distribute its profits and conditions upon the fulfilment of which, or matters by reason of which, the public limited partnership shall be entitled to refrain from distributing its profits, provided that the Minister shall not prescribe such provisions if the partnership regulations prescribe an unqualified obligation to distribute profits.
Status of a Holder of a Participation Unit§
65bc.

The exercise of rights by holders of participation units under this Chapter shall not be regarded as participation in the management of the business of the partnership, and the provisions of section 63(c) shall not apply in the case of the exercise of rights as aforesaid.

Compulsory Sale of Participation Units§
65bd.

The provisions of Section A of Chapter III in Part 8 of the Companies Law shall apply to a public limited partnership and to holders of participation units as if they were a company and shareholders, with the necessary modifications and the following modification: instead of "person" read "the general partner company or the controlling shareholder of the general partner company".

Disclosure of Personal Interest by a Holder of a Participation Unit§
65be.

A holder of a participation unit participating in a vote at a general meeting pursuant to sections 65r, 65as or 65ay(c)(3) shall notify the public limited partnership before the vote at the general meeting, or — if the vote is by means of a voting instrument — on the voting instrument, whether or not the holder has a personal interest in the approval of the transaction; if a holder of a participation unit has not given such notice, the holder shall not vote and the holder's vote shall not be counted.

Merger§
65bf.

The provisions of Chapter I in Part 8 of the Companies Law shall apply to the public limited partnership as if it were a public company, with the necessary modifications and the following modifications:

(1)everywhere, instead of "the general meeting" read "the general meeting of holders of participation units" and instead of "Registrar of Companies" read "Registrar of Partnerships";
(2)in section 320 —
(a)in subsection (a1), paragraph (2) — shall not apply;
(b)instead of subsection (c) read:

"At a vote at the general meeting of holders of participation units in a merging public limited partnership whose participation units are held by the other merging public limited partnership or by the controlling shareholder of the general partner in the other merging partnership, the merger shall not be approved if it is opposed by holders of participation units holding a majority of the voting rights among those participating in the vote, excluding abstentions, who are not counted among the other merging partnership, or the controlling shareholder of the general partner as aforesaid, or any person on their behalf, including their relatives or corporations under their control; however, a person shall not be regarded as holding in the other merging partnership if the holding derives solely from holding participation units in the public limited partnership.";

(c)in subsection (d), instead of "a person held twenty-five percent or more of any class of means of control in a number of merging companies" read "a person was the controlling shareholder in a number of the general partner companies of the merging public limited partnerships";
(d)in subsection (f), instead of "section 275(a), (c) and (d)" read "section 65ay of the Partnerships Ordinance [New Version], 5735-1975".

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Section K: Imposition of a Financial Sanction by the Securities Authority

Imposition of a Financial Sanction by the Securities Authority§
65bg.
(a)In this Section, "the base amount" means an amount as set out below, as the case may be:
(1)with respect to a general partner company — the amount prescribed for the public limited partnership in item 1 of the Sixth Schedule of the Securities Law;
(2)with respect to an individual — the amount prescribed in item 5 of the Sixth Schedule of the Securities Law.
(b)If a person has contravened a provision of the provisions under this Ordinance, as set out below, the Securities Authority may impose on that person a financial sanction under the provisions of this Section, in the base amount:
(1)the general partner company has not prescribed the minimum required number of directors on the board of directors who must have accounting and financial expertise, contrary to the provisions of section 92(a)(12) of the Companies Law as applied by section 65c of this Ordinance;
(2)the general partner company has had no chairperson of the board of directors serving, contrary to the provisions of section 94(a) of the Companies Law as applied by section 65d of this Ordinance, for more than 60 days;
(3)the chief executive officer, or a relative thereof, or a person subordinate to the chief executive officer, directly or indirectly, is serving as chairperson of the board of directors in the general partner company, contrary to the provisions of section 95(a) of the Companies Law as applied by section 65d of this Ordinance;
(4)the chairperson of the board of directors in the general partner company is serving as the holder of another position in the company or in the public limited partnership, contrary to the provisions of section 95(b) of the Companies Law as applied by section 65d of this Ordinance;
(5)the general partner company has had no audit committee serving, contrary to the provisions of sections 114 and 115 of the Companies Law as applied by section 65e of this Ordinance, for more than 90 days;
(6)the general partner company has had no chief executive officer serving, contrary to the provisions of section 119(a) of the Companies Law as applied by section 65g of this Ordinance, for more than 90 days;
(7)a director or office holder who has been convicted of an offence is serving in the general partner company, contrary to the provisions of section 226 or section 251a of the Companies Law as applied by section 65h of this Ordinance; however, a financial sanction shall not be imposed on the appointing party or on the company if the director or office holder did not notify the appointing party or the company, as the case may be, of the conviction;
(8)a director or office holder whose appointment has been prohibited by an administrative enforcement committee is serving in the general partner company, contrary to the provisions of section 226a or section 251a of the Companies Law as applied by section 65h of this Ordinance; however, a financial sanction shall not be imposed on the appointing party or on the company if the director or office holder did not notify the appointing party or the company, as the case may be, of the prohibition;
(9)at least two external directors are not serving in the general partner company, contrary to the provisions of section 239(a) of the Companies Law as applied by section 65i of this Ordinance, for more than 90 days, and with respect to the first external directors as referred to in section 242 of the Companies Law as applied by section 65i of this Ordinance — for more than 90 days from the last date for convening a general meeting under that section;
(10)in a general partner company in which, at the time of appointment of an external director, all members of its board of directors are of one sex, an external director of the other sex has not been appointed, contrary to the provisions of section 239(d) of the Companies Law as applied by section 65i of this Ordinance;
(11)an external director with accounting and financial expertise is not serving in the general partner company, contrary to the provisions of section 240(a1)(1) of the Companies Law as applied by section 65i of this Ordinance, for more than 90 days;
(12)at least one external director is not serving on a committee that is authorised to exercise any of the powers of the board of directors of the general partner company, contrary to the provisions of section 243 of the Companies Law as applied by section 65i of this Ordinance;
(13)an internal auditor is not serving in the general partner company, contrary to the provisions of section 146 of the Companies Law as applied by section 65n of this Ordinance, for more than 90 days;
(14)a supervisor is not serving in a public limited partnership, contrary to the provisions of sections 65q and 65r, for more than 90 days, and with respect to the first supervisor as referred to in section 65r(a) — for more than 90 days from the date of the first offering of participation units to the public;
(15)a supervisor who has been convicted of an offence is serving in a public limited partnership, contrary to the provisions under section 226 of the Companies Law as applied by section 65t of this Ordinance; however, a financial sanction shall not be imposed on the general partner company if the supervisor did not notify it of the conviction;
(16)a supervisor whose appointment has been prohibited by an administrative enforcement committee is serving in a public limited partnership, contrary to the provisions under section 226a of the Companies Law as applied by section 65t of this Ordinance; however, a financial sanction shall not be imposed on the general partner company if the supervisor did not notify it of the prohibition.
(c)Notwithstanding the provisions of subsection (b), a financial sanction shall not be imposed for a contravention of paragraphs (5), (9), (11) and (14) of that subsection if the contravention arises from the failure to appoint an external director or supervisor due to the absence of the majority required for appointment at the general meeting.
(d)In the counting of days under this section, there shall not be included the days required for the approval of the appointments by whoever supervises the public limited partnership under any law.
Continuing Contravention and Repeated Contravention§
65bh.
(a)In a continuing contravention, two percent shall be added to the amount of the financial sanction for each day on which the contravention continues.
(b)In a repeated contravention, an amount equal to half the financial sanction that could have been imposed for it had it been a first contravention shall be added to that financial sanction; for this purpose, "repeated contravention" means a contravention of a provision of the provisions as set out in section 65bg(b), within two years of a previous contravention of the same provision in respect of which the Securities Authority imposed a financial sanction on the contravener under this Section.
Application of Provisions from the Securities Law§
65bi.

The provisions under sections 52p to 52r, 52t to 52aa and 56h of the Securities Law shall apply to a financial sanction under this Section, with the necessary modifications.

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Section L: Limitation of Application and Authorisation to Make Regulations under the Companies Law

Limitation of Application§
65bj.

The Minister may, after consulting with the Securities Authority, prescribe that the provisions of this Chapter, in whole or in part, shall not apply to a class of public limited partnership as the Minister shall prescribe.

Authorisation to Make Regulations under the Companies Law Applied for the Purposes of this Chapter§
65bk.
(a)In any matter in this Chapter in respect of which a provision of the Companies Law that includes an authorisation to make Regulations by the Minister has been applied, the Regulations made under the Companies Law as aforesaid shall apply, with the necessary modifications; however, the Minister may make special Regulations for this Chapter with respect to a matter in respect of which the Minister has been so authorised.
(b)Regulations under this Chapter require the approval of the Constitution, Law and Justice Committee of the Knesset.

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Chapter VII: Legal Proceedings

A Registered Partnership is a Corporation§

66.
(a)A partnership registered under this Ordinance is a corporation and may sue and be sued in its registered name.
(b)This section shall apply to proceedings between the partnership and its members or between partnerships that have a common member and are carrying on business in Israel; however, in such proceedings, no execution order shall be issued without leave of the court hearing the proceedings, and if an application for such leave has been filed, the court may direct the taking of accounts and inquiries and make any other order that it considers just.

Judgment and Execution§

67.
(a)No execution order shall be issued against a partnership except pursuant to a judgment against it.
(b)A court that has given a judgment against a partner may, on the application of the judgment creditor, issue an order charging the partner's interest in the assets of the partnership with payment of the debt under the judgment and the interest thereon; and the court may, in the same order or in another order, appoint a receiver over the partner's share in the profits of the partnership, whether accrued or declared, and over any other monies due to the partner in respect of the partnership, and may direct the taking of accounts and inquiries and make any order and give any direction that could have been given had the charge been made by the partner in favour of the judgment creditor, or that are required by the circumstances of the matter.
(c)The other partners may at any time redeem the charged interest, and if an order has been given for its sale, they may purchase it.

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Chapter VIII: Registration

Registrar and Seals§

68.
(a)The Minister of Justice may by Order appoint a Registrar of Partnerships and such other employees as appear to the Minister to be necessary; and if no such person has been appointed, the Registrar of the District Court shall serve as the Registrar of Partnerships for partnerships established within its jurisdiction; however, as Registrar of limited partnerships registered under this Ordinance, the Registrar of Companies shall serve.
(b)The Minister of Justice may direct the making of seals for the authentication of certificates required for the registration of partnerships and for all matters connected therewith.

Registration of Notices and Presentation of Certificates§

69.
(a)Upon receipt by the Registrar from a partnership of a notice drawn up in accordance with this Ordinance, the Registrar shall direct that it be kept on file and shall send by post, or deliver, to the partnership a certificate of registration of the notice.
(b)The certificate, or a certified copy thereof, shall at all times be prominently displayed at the principal place of business of the partnership; a partnership that has not complied with this provision, and each of its partners, shall be liable to a fine of 5 liras for each day on which the offence continued.

Register and Index Open for Inspection§

70.
(a)The Registrar shall maintain a register and index of all partnerships registered under this Ordinance and of all notices registered in relation to partnerships.
(b)Any person may inspect the register and index upon payment of the prescribed fee.
(c)Any person may, upon payment of the prescribed fee, obtain a certificate of registration of a partnership, and also a copy or extract of any registered notice, certified by the Registrar.
(d)A certificate of registration, and also a copy or extract duly certified by the signature of the Registrar, shall be admitted in any legal proceeding as evidence of equal weight to the original document.

Regulations§

71.

The Minister of Justice may make Regulations with respect to any of the following matters:

(1)the fees payable to the Registrar;
(2)the functions that the Registrar is to perform;
(3)the performance of the Registrar's functions by other employees;
(4)the forms to be used;
(5)the management of the registration and its procedures in general and any other matter connected therewith.

Order for Delivery of Notice or Registration of Document§

72.

A partner, a creditor of a partnership, or the Registrar, who has required the partnership to deliver a notice or register a document as required under this Ordinance, and the requirement has not been fulfilled within ten days of the date of its delivery, may apply to the Magistrate's Court, and the Magistrate's Court may, on the application of the person making the requirement, order that the requirement be fulfilled and direct the partnership or any partner responsible for the default to pay the costs of the application.

Striking Off a Partnership§

73.
(a)If the Registrar has reasonable cause to believe that a particular partnership is not continuing its business, or is inactive, the Registrar may, by a letter sent by post to the registered address of the partnership, enquire in that regard.
(b)If within one month after the sending of the letter the Registrar has not received a reply to it, the Registrar shall, within fourteen days after the expiry of that month, send a registered letter to the registered address of the partnership, referring to the first letter and stating that no reply to it has been received, and that if within one month after the sending of the second letter no reply is received, a notice will be published in Reshumot (Official Gazette) that the name of the partnership is to be struck off the register.
(c)If the Registrar has received a reply that the partnership is not continuing its business or is inactive, and also if no reply has been received within one month after the second letter was sent, the Registrar may publish a notice in Reshumot (Official Gazette) and inform the partnership by a letter sent by post to its registered address that, after three months from the date of the notice, the name of the partnership specified therein will be struck off, unless cause is shown to the contrary.
(d)Where a partnership is in the course of winding up and the Registrar has reasonable cause to believe that the business of the partnership has been fully wound up, the Registrar shall publish in Reshumot (Official Gazette) and send to the partnership a notice as referred to in subsection (c).
(e)Upon the expiry of the period mentioned in the notice, the Registrar may strike the name of the partnership off the register, unless the partnership has shown cause to the contrary; upon striking off its name, the Registrar shall publish a notice to that effect in Reshumot (Official Gazette), and upon the publication of the notice the partnership shall be dissolved, save that the liability of every partner therein shall continue and may be enforced as if the partnership had not been dissolved.
(f)A partnership or any of its partners or creditors who considers themselves aggrieved by the striking off of the name of the partnership, and the court, on the application of any of these, being satisfied that the partnership was continuing its business or was active at the time its name was struck off, or seeing other cause why it is just to restore its name to the register, may by order direct that its name be restored to the register, and upon such direction the partnership shall be deemed to have continued its business and its name shall be deemed not to have been struck off; and the court may in the order give any direction and make any order that it considers just, so as to place the partnership and all other persons as nearly as possible in the same position as if the partnership had not been struck off.
(g)The applicant shall send a copy of the order to the Registrar within seven days of the date on which it was given, and the Registrar shall register it forthwith.
(h)Any person who contravenes subsection (g) shall be liable to a fine of 15 liras for each day on which the offence continued.
(i)The court may order the winding up of the partnership even after its name has been struck off the register by virtue of the provisions of this section.

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