Party Financing Law, 5733-1973
חוק מימון מפלגות, תשל"ג-1973
Published: 1973-02-01Last amended 2026-07-19✓ Amendment status checked against the Knesset legislation record on 2026-09-29
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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.
This translation is provided for informational purposes only and does not constitute legal advice. For use in legal proceedings, request a certified Expert Legal Opinion.
Definitions§
1.
In this Law –
"party" – as defined in the Parties Law, 5752-1992;
"faction" – any of the following:
(1)a party that was represented by a faction in the outgoing Knesset, submitted a list of candidates in elections to the Knesset and is represented in the Knesset by at least one Member of the Knesset;
(2)a party whose representative or representatives in the Knesset have been recognised by the Knesset Committee as a faction;
(3)a combination of two or more parties that maintains a single faction in the Knesset;
"new faction" – a party that was not represented by a faction in the outgoing Knesset, submitted a list of candidates in elections to the Knesset and is represented in the Knesset by at least one Member of the Knesset;
"body associated with a faction" – an association of persons, whether incorporated or unincorporated, that participates in election propaganda or in ongoing party activity and which, in the opinion of the State Comptroller, is to be regarded as an arm of the faction having regard to all or some of the following characteristics: the objects of the association of persons, its activities, the identity of its owners, managers and members, the allocation of its profits and the sources covering its losses; but excluding a workers' organisation and a cooperative society for settlement in respect of activities which, in the opinion of the State Comptroller, were carried out otherwise than as an arm of a faction;
"expenditure" – expenditure of a faction for the organisation of its activities, for propaganda and public information and for maintaining organisational and ideological contact with the public, including obligations in respect of such expenditure;
"election expenditure" – the special expenditure of a faction or of a list of candidates incurred during the election period or for the purposes of the elections in the Knesset election campaign;
"current expenditure" – expenditure of a faction, other than election expenditure;
"monthly financing received by a faction in respect of current expenditure" – the financing to which a faction is entitled under sections 3(c) and 12, including under an agreement as referred to in section 12(d);
"linkage differentials and interest" – (deleted)
"faction employees" – employees of a party or of a faction who are regularly employed in the faction's offices in the Knesset and whose principal occupation is the parliamentary activity of the faction in the Knesset and who receive remuneration in accordance with the provisions of section 3a;
"the determining day" – any of the following, as the case may be –
(1)the 101st day before the day of elections to the Knesset pursuant to section 9 of Basic Law: The Knesset;
(2)in elections held pursuant to the Law for the Dissolution of the Knesset, as referred to in section 34 of Basic Law: The Knesset – the third day after the commencement of that law;
(3)in early elections held pursuant to the provisions of sections 11(b) or 29(f) of Basic Law: The Government, or pursuant to the provisions of section 36a of Basic Law: The Knesset – the third day after the day on which the grounds for holding the early elections arose;
(4)(deleted)
"election period" – the period from the determining day until the day of elections;
"financing unit" – an amount determined by the Public Committee as a financing unit for the purposes of this Law, notice of the determination of which has been published in Reshumot (Official Gazette).
"the Public Committee" – the committee established pursuant to section 1a;
"the Elections Law" – the Knesset Elections Law [Consolidated Version], 5729-1969;
"the Knesset Law" – the Knesset Law, 5754-1994;
"the Interest and Linkage Adjudication Law" – the Interest and Linkage Adjudication Law, 5721-1961;
"list of candidates" – a party that is not represented in the Knesset and that submitted a list of candidates in elections to the Knesset;
"joint list of candidates" – as defined in section 57 of the Elections Law;
"current financing agreement" – an agreement between parties that submitted a joint list of candidates with respect to monthly financing as referred to in section 12(d), submitted to the Chairman of the Central Elections Committee at the time of submission of the joint list of candidates;
"election expenditure agreement" – an agreement between parties that submitted a joint list of candidates with respect to election financing as referred to in section 13b(d);
"banking corporation" – as defined in the Banking (Licensing) Law, 5741-1981.
"entity active in elections" – a person or association of persons who registered as referred to in section 10c(a) for the purpose of carrying out election activity;
"database" – a database as referred to in paragraph (1) of the definition of "election activity";
"election activity" – one or more of the activities listed below carried out otherwise than by a party or a body associated with a faction:
(1)creating a database containing identifying particulars of voters in Knesset elections alongside information regarding their voting intentions in the elections, for the purpose of carrying out the activities referred to in paragraphs (2) to (4) below, and not for the purpose of selling it to a party;
(2)transporting voters on the day of Knesset elections, otherwise than pursuant to law and otherwise than for full consideration, for the purpose of ensuring their vote on account of their voting intentions in the elections;
(3)direct contact during the election period with voters holding particular political views with the aim of influencing them to vote for a particular list of candidates or to refrain from voting for a particular list of candidates;
(4)propaganda by means of advertisements, aimed at influencing voters to vote for a particular list of candidates or to refrain from voting for a particular list of candidates.
"shekel interest" – as defined in the Interest and Linkage Adjudication Law.
Public Committee§
1a.
(a)For the purposes of this Law, a Public Committee of three shall be established, headed by a judge appointed by the President of the Supreme Court; its other members shall be appointed by the Speaker of the Knesset; one of the members of the Committee shall, at the time of his appointment, be a member of the academic staff of an institution of higher education recognised pursuant to the Council for Higher Education Law, 5718-1958.
(b)The term of office of the Public Committee shall be four years from the date of its appointment; notice of the appointment of the Committee and of its composition shall be published in Reshumot (Official Gazette) on behalf of the Knesset.
(c)A member of the Public Committee who has served thereon for two full consecutive terms of office shall not be appointed for a further consecutive term of office.
(d)If a member of the Committee ceases to serve or is permanently prevented from fulfilling his duties, another shall be appointed in his place as referred to in subsection (a) for the remainder of the term of office of the Committee.
(e)The Speaker of the Knesset shall prescribe provisions regarding the payment of remuneration to members of the Public Committee, to be paid from the State Treasury.
Function of the Public Committee§
1b.
(a)The Public Committee shall determine the rate of the financing unit as referred to in section 3.
(b)The commencement of a determination of the financing unit shall be on one of the following dates, as the Public Committee shall decide: 1 January, 1 April, 1 July or 1 October.
(c)The Public Committee shall not reduce an amount or financing unit that it has determined except by a decision taken unanimously.
(d)No financing unit shall be determined with retroactive effect.
(e)(Repealed)
Linkage§
1c.
(a)In this section, "index" – the consumer price index published by the Central Bureau of Statistics.
(b)The financing unit shall be updated on 1 January of each year in accordance with the rate of increase of the index, and in this regard the following provisions shall apply:
(1)(deleted)
(2)the amounts that have changed shall be rounded to the nearest hundred new Israeli shekels;
(3)the Committee shall publish in Reshumot (Official Gazette) a notice of the amounts that have changed pursuant to its determination as referred to in section 1b; a notice of the amounts updated pursuant to this section shall be published in Reshumot (Official Gazette) on behalf of the Knesset.
(c)The amounts specified in sections 3a, 8, 8c, 9a and 10c shall be linked to the index and rounded as referred to in subsection (b); the updated amounts shall be published in Reshumot (Official Gazette) on behalf of the Knesset.
Entitlement to Financing§
2.
(a)Every faction is entitled, pursuant to the provisions of this Law –
(1)to financing of election expenditure during the election period;
(2)to financing of its current expenditure in each month commencing in the month after the publication of the results of the elections to the Knesset until the month in which the results of the elections to the next Knesset are published.
(3)(deleted)
(a1)A faction or list of candidates that received in the elections a number of valid votes exceeding 1% but does not participate in the distribution of mandates pursuant to section 81(a) of the Elections Law is entitled to receive election expenditure at the rate of one financing unit, provided that the conditions in section 6(a) are met, with the necessary modifications; 85% of the amount shall be paid immediately after the publication of the election results, and 15% of the amount – immediately after the State Comptroller has submitted to the Speaker of the Knesset a favourable report pursuant to section 10(b), and an advance paid to the list of candidates pursuant to section 4 shall be deducted from these payments in the manner referred to in section 4(c) or (c1), as the case may be; for this purpose, "valid votes" – as defined in the Elections Law.
(b)The financing monies shall be paid from the State Treasury through the Speaker of the Knesset, to a bank account of each faction, as referred to in section 6(a)(3).
2a.§
(Repealed — תשס״ב)
2b.§
(Repealed — תשס״א)
Calculation of Financing§
3.
(a)
(1)The financing of the election expenditure of a new faction shall be calculated at one financing unit for each mandate it received in the elections to the Knesset, plus an amount equal to 1.4 financing units;
(2)The financing of the election expenditure of a faction created in the outgoing Knesset as a result of a decision of the Knesset Committee on a change in the factional composition of the Knesset and not as a result of the election to the outgoing Knesset of the party which that faction represents, shall be one financing unit for each mandate received by the faction in the elections to the incoming Knesset, plus an amount equal to 1.4 financing units.
(b)The financing of the election expenditure of a faction shall be calculated according to the number of financing units obtained from the number of mandates received by the faction in the outgoing Knesset plus the number of mandates received by the faction in the incoming Knesset divided by two, plus an amount equal to 1.4 financing units.
(b1)The financing of the election expenditure of parties that submitted a joint list of candidates shall be calculated for each party separately pursuant to the provisions of subsections (a) and (b) whether the election account is maintained separately or jointly, pursuant to the provisions of section 13b(a) or (b); however, the addition of the amount equal to 1.4 financing units as referred to in subsections (a) and (b) shall be paid once for all the said parties and shall be divided among them according to their actual proportionate share of the total financing of election expenditure granted to them pursuant to subsections (a), (b) or (b2).
(b2)Notwithstanding the provisions of subsections (a) to (b1), where a current financing agreement has been concluded, the number of mandates received by each of the parties that is a party to the agreement shall be deemed, for the purpose of financing election expenditure, to be the number corresponding to the rate of monthly financing in accordance with the agreement at the time of the first payment of financing of current expenditure pursuant to section 2(a)(2), and the number shall not be rounded, all unless the said agreement provides that the provisions of this subsection shall not apply.
(c)The monthly financing of the current expenditure of a faction shall be an amount of 6% of one financing unit for each mandate received by the faction in the elections to the Knesset, plus an amount of 6% of one financing unit.
Remuneration and Payments to Faction Employees§
3a.
(a)A faction comprising at least two Members of the Knesset is entitled to financing from the Knesset budget of remuneration and other payments for faction employees as detailed in the Schedule, according to the number of Members of the Knesset belonging to the faction as set out below, and they shall be employed on a full-time basis:
(b)If there is a change in the number of members of the faction during the term of office of the Knesset, the annual entitlement pursuant to subsection (a) shall change accordingly and shall apply in that year on a proportionate basis.
(c)In addition to the financing of remuneration and other payments to faction employees as referred to in subsection (a), the following shall be financed from the Knesset budget for a faction comprising at least two Members of the Knesset –
(1)a contribution towards the accommodation expenses of a faction employee whose permanent place of residence is not in Jerusalem and who is required to stay overnight in Jerusalem for the purposes of his work, as detailed in the Schedule;
(2)essential equipment for the work of a faction employee, including a mobile telephone, a computer and office equipment from the Knesset stores only, as detailed in the Schedule.
(d)The remuneration and other payments as referred to in subsection (a) shall be paid directly to faction employees or on their behalf, as the case may be, in accordance with the notification of the faction to the Knesset Accountant-General.
(e)A faction receiving financing of its current expenditure pursuant to section 2(a)(2) may notify the Knesset Accountant-General that it requests to deduct from such financing amounts to be added to the payments made from the Knesset budget pursuant to subsections (a) and (c).
(f)No employment relations shall exist between faction employees and the Knesset, and for the purpose of making payments pursuant to this section the Knesset shall serve as a service bureau only.
(g)The Knesset Committee may amend the Schedule, provided that it has received a recommendation thereon from the Public Committee appointed pursuant to the provisions of section 52 of the Knesset Law (in this section – the Public Committee).
(h)Where the Public Committee has submitted a recommendation pursuant to subsection (g), the Chairman of the Knesset Committee shall lay it on the table of the Knesset; a recommendation laid on the table of the Knesset shall be brought for deliberation before the Knesset Committee, which shall be entitled to approve it or to reject it.
(i)A person who is any of the following shall not receive remuneration, other payments or other financing pursuant to this section:
(1)a parliamentary adviser;
(2)a family member of a Member of the Knesset belonging to the faction that employs the faction employee or of another faction employee in the same faction; for this purpose, "family member" – a spouse, descendant, sibling or parent, and also the spouse, descendant, sibling or parent of each of the foregoing, including a relative as aforesaid by virtue of marriage or adoption.
(j)A faction employee who wishes to engage in additional paid employment shall not do so unless a representative of the faction has approved this in writing and the Legal Adviser to the Knesset has approved in writing that the employment does not raise concern of a conflict of interests in his work and does not prevent the employee from being regularly employed on a full-time basis in the faction's offices in the Knesset; a faction employee who wishes to engage in additional paid employment shall transmit the said two approvals to the Knesset Accountant-General, and their transmission shall constitute a condition for making payments to the employee.
(k)The remuneration of a faction employee from additional employment in a year shall not exceed one half of the remuneration paid to him in that year for his work as a faction employee, and if he was employed for part of the year – one half of his remuneration during the period of his employment as a faction employee; notwithstanding the foregoing, the Public Committee may decide that the employee is entitled to receive higher remuneration from the additional employment, as it shall determine.
(l)The provisions of this section shall also apply to a faction created as a result of a split of a faction pursuant to section 59 of the Knesset Law, even if it does not represent a party.
| Column A – Number of Faction Members | Column B – Maximum Number of Employees | |
|---|---|---|
| (1) | 2 to 5 | 1 |
| (2) | 6 to 10 | 2 |
| (3) | 11 to 20 | 3 |
| (4) | More than 20 Members of the Knesset | 4 |
| (5) | For every 10 Members of the Knesset above 20 Members of the Knesset | 1 additional |
Payment of Election Expenditure§
4.
(a)
(1)A faction that has delivered to the Speaker of the Knesset a confirmation from the Chairman of the Central Elections Committee that it has submitted a list of candidates for the incoming Knesset shall immediately be paid an advance on account of the financing of its election expenditure; the advance shall be 80% of one financing unit for each Member of the Knesset counted among the faction on the determining day; for this purpose the provisions of section 62 of the Knesset Law shall apply, however a Member of the Knesset whom the Knesset Committee has determined to have left the faction after the determining day shall not be counted;
(2)for the purposes of this section, parties that submitted a joint list of candidates shall be regarded as a single faction, whether the election account is managed separately or jointly, in accordance with the provisions of section 13b(a) or (b);
(3)where parties that submitted a joint list of candidates manage the election account separately as referred to in section 13b(a), the advance shall be divided among them in proportion to the number of Members of the Knesset counted among each of them on the determining day as referred to in paragraph (1);
(4)notwithstanding the provisions of paragraphs (1) and (3), where a current financing agreement has been made, the number of Members of the Knesset counted among each of the parties that is a party to the agreement on the determining day shall be deemed to be the number corresponding to the monthly financing rate under the agreement on the determining day, and the number shall not be rounded, all unless the said agreement provides that the provisions of this paragraph shall not apply.
(a1)Notwithstanding the provisions of subsection (a), a faction comprising fewer than ten Members of the Knesset may request an advance on account of the financing of its election expenditure at the rate of 80% of ten financing units, provided that it has deposited with the Speaker of the Knesset, to his satisfaction, an independent bank guarantee for the difference between the advance amount under this subsection and the advance amount to which it is entitled under subsection (a); the bank guarantee shall be valid for at least six months after the day of elections; the bank guarantee shall include an undertaking by the bank to pay to the State Treasury the amount of the guarantee, in whole or in part, upon demand by the Speaker of the Knesset.
(a2)A list of candidates may request an advance on account of the financing of its election expenditure at the rate of ten financing units, provided that it has delivered to the Speaker of the Knesset a confirmation from the Chairman of the Central Elections Committee that a list of candidates for the incoming Knesset has been submitted, has deposited a bank guarantee as referred to in subsection (a1), and has also fulfilled the conditions set out in section 6(a).
(a3)
(1)A party that is not represented in the Twenty-Fifth Knesset and that has notified the Accountant of the Knesset, from the determining day onwards, of its intention to submit a list of candidates for the Twenty-Sixth Knesset may request an advance on account of the financing of its election expenditure in the amount of two financing units, provided that it has deposited a guarantee as referred to in subsection (a1) and has fulfilled the conditions set out in section 6(a), with the necessary modifications;
(2)an advance as referred to in paragraph (1) shall be taken into account with respect to the advance amount to which the list of candidates submitted by that party is entitled under subsection (a2); if the party did not submit a list of candidates for the Twenty-Sixth Knesset, the guarantee shall be realised without delay;
(3)notifications and requests of a party under this subsection shall come from the party's representative or his alternate appointed pursuant to section 19b of the Parties Law, 5752-1992.
(b)Where a faction or a new faction has won at least one seat in the elections to the incoming Knesset, the amount due to it under section 3 shall be paid to it immediately after the publication of the election results.
(c)An advance received by a faction or a new faction under subsection (a) shall be deducted from the payments under subsection (b); if the advance exceeds the amount due to the faction for the financing of its election expenditure, the balance shall be deducted from the first or first few amounts due to it for the financing of its current expenditure.
(c1)Where the advance paid under subsections (a1) and (a2) exceeds the amount due to the faction or to the list of candidates under subsection (b), the Speaker of the Knesset shall order the realisation of the bank guarantee, in whole or in part, up to the difference between the advance amount paid and the amount due as aforesaid.
(c2)Where an advance on account of the financing of election expenditure has been paid to a party in an amount exceeding the amount due to it for the financing of election expenditure, and it cannot be deducted or a bank guarantee cannot be realised in respect thereof under subsection (c) or (c1), the party shall return it without delay, and if it has not done so, the debt shall be deducted from any amount due to it from the State Treasury under this Law or under any other law; the Speaker of the Knesset shall notify the Minister of Finance, the Minister of Justice and the Minister of the Interior of a debt as aforesaid that has not been returned.
(c3)With respect to a party that submitted a joint list of candidates and to which an advance was paid as referred to in subsection (c2), and where the debt cannot be deducted in the manner referred to in that subsection, the debt shall be deducted from the current expenditure payments of the other parties that submitted the joint list of candidates with it, in proportion to each party's actual share of the total financing of current expenditure.
(d)A new faction shall be entitled to reimbursement of financing expenditure it has borne in connection with its election expenditure.
(e)For the purposes of this section, "financing expenditure" – financing expenditure paid to a financial institution in connection with credit extended to the faction for the purposes of election expenditure borne by the faction from 15 days after the determining day, provided that financing expenditure shall not be reimbursed in respect of credit exceeding the amount of election expenditure financing to which the faction is entitled under section 3 and which has not yet been paid to it under subsections (a) or (b).
Restriction on Financing§
4a.
No special financing shall be provided for the purposes of expenditure on repeat elections held in a particular polling area, as referred to in section 86(d)(1) of the Elections Law.
Payment of Current Expenditure§
5.
Payments for the financing of the current expenditure of factions shall be made to them at times to be determined by the Public Committee.
Appointment of Auditor§
5a.
(a)A faction or a list of candidates shall appoint an auditor to audit its accounts and to provide an opinion pursuant to section 10(d1).
(b)The auditor, notice of whose appointment has been delivered pursuant to section 6(a)(4) and who has given his consent to serve in that capacity (hereinafter – the auditor), shall continue to serve so long as another person has not been appointed in his place.
(c)Where the auditor has resigned or is prevented from carrying out his duties, the faction or list of candidates shall, within thirty days from the day it became aware thereof, appoint another auditor in his place.
(d)The State Comptroller may lay down guidelines for auditors appointed for the purposes of this Law with respect to methods and procedures for the examination of the accounts of factions and of lists of candidates.
Conditions for Payment§
6.
(a)A prior condition for the payment of amounts for the financing of election expenditure and for the financing of current expenditure is that, from the determining day, and in the case of a new faction – from the day on which it was recognised as a faction –
(1)the faction has notified the Speaker of the Knesset of the names of not fewer than two and not more than eight representatives who shall be authorised to act on behalf of the faction for the purposes of this Law (hereinafter – the representatives); the consent of the representatives shall be attached to the notification; at least one of the representatives shall be a Member of the Knesset and at least one of them shall be declared by the faction and by that person himself to be knowledgeable in the financial affairs of the faction;
(2)the faction has submitted to the Speaker of the Knesset a declaration signed by its representatives that the faction has done everything necessary to ensure proper management of its revenue and expenditure account in accordance with the directives of the State Comptroller in this regard;
(3)the faction has notified the Speaker of the Knesset of the number of its account or accounts at a bank or banks.
(4)the faction or list of candidates has notified the Speaker of the Knesset of the name and address of its auditor and such additional particulars concerning the auditor as the Speaker of the Knesset has determined, and has attached a letter of consent by the auditor to serve in that capacity.
(b)A faction may at any time replace its representatives or add to them, provided that it has notified the Speaker of the Knesset accordingly and that the representatives meet the requirements referred to in subsection (a)(1); it may also notify the Speaker of the Knesset of the replacement of its bank accounts or the addition of such accounts, provided that it has presented to him a document from the bank indicating that the account it seeks to replace has no debit balance.
Authorised Signatory§
6a.
(a)A financial obligation of a faction or of a list of candidates shall have effect only if given by persons designated by the faction and whose names have been published in accordance with the directives of the State Comptroller.
(b)Nothing in subsection (a) shall derogate from the authority of the State Comptroller to treat a financial obligation given in contravention of subsection (a) as expenditure or as the receipt of donations under this Law.
Limitation of Expenditure§
7.
(a)(Repealed)
(b)Subject to the provisions of subsection (c), a faction or a new faction shall not incur election expenditure in an amount exceeding seventy financing units.
(c)
(1)A faction that on the determining day comprised not more than five Members of the Knesset shall not incur election expenditure in an amount exceeding ten financing units;
(2)a faction that on the determining day comprised more than five Members of the Knesset but fewer than eleven shall not incur election expenditure in an amount exceeding twice one financing unit for each Member of the Knesset in that faction;
(3)a faction that on the determining day comprised eleven or more Members of the Knesset shall not incur election expenditure in an amount exceeding twice one financing unit for each of the first ten Members of the Knesset, and one and a half times one financing unit for each of the remaining Members of the Knesset.
(4)A list of candidates shall not incur election expenditure in an amount exceeding ten financing units or the amount under paragraphs (2) or (3), according to the number of seats it has won, whichever is the higher.
(d)A faction shall not in the course of a year incur current expenditure in an amount exceeding by more than three-fifths the amount due to it for the financing of its current expenditure, including under a current financing agreement, or in an amount exceeding by more than three-fifths the amount due as aforesaid to a faction with five Members of the Knesset, whichever is the greater.
(e)(Repealed)
(f)(Repealed)
Restriction on Loans to a Party§
7a.
A party that is not represented in the Knesset, including a list of candidates, shall not receive a loan except from a banking corporation.
Bank Account of a Faction and Restriction on Loans§
7b.
(a)A banking corporation shall not unreasonably refuse to open a current account in Israeli currency for a party or a faction or to manage such an account for so long as the party or faction complies with the terms of the agreement between it and the banking corporation in connection with the management of the account; however, there is no obligation to provide a service that constitutes the extension of credit to them.
(b)A faction shall not receive a loan from any source, other than –
(1)a loan from the State Treasury under section 7c;
(2)a loan from a banking corporation on customary terms for the purpose of acquiring a right in real property only.
(c)For the purposes of subsection (b), a debit balance in a current account into which the financing of current expenditure is received shall not be regarded as a loan, provided that the debit balance in that account does not exceed half the amount the faction is due to receive for the financing of its current expenditure in a month.
(d)A party or faction may receive a bank or other guarantee in accordance with guidelines determined by the State Comptroller, including with respect to the amount of the guarantee.
Loan to a Faction§
7c.
(a)A faction is entitled to receive loans from the State Treasury, through the Speaker of the Knesset, on the terms referred to in this section, as the case may be.
(b)
(1)After the publication of election results and until the end of three years from the day of the convening of the Knesset or until the determining day, whichever is earlier, a faction may receive a loan in an amount not exceeding half the financing of current expenditure it receives in a month for each month from the date of the loan until the end of three years from the day of the convening of the Knesset;
(2)the principal of a loan under paragraph (1) shall be repaid in equal instalments by way of deduction from the financing of current expenditure that the faction receives in a month, from the month following the receipt of the loan until the end of three years from the day of the convening of the Knesset; nothing therein shall prevent early repayment of the loan;
(3)where a loan as referred to in paragraph (1) is requested shortly before the day of elections to the Knesset, including after the approval of a bill for the dissolution of the Knesset at its first reading, the loan shall not be granted unless the Speaker of the Knesset is satisfied that it is justified in the circumstances of the matter, on the recommendation of the Public Committee; where the Speaker of the Knesset has so decided, his decision shall apply to all factions.
(c)Where the term of the Knesset ends before a loan as referred to in subsection (b) has been repaid and the faction has submitted a list of candidates for the incoming Knesset, the outstanding balance of the loan shall be deducted from the advance to which it is entitled under section 4; if the faction has not submitted a list of candidates for the incoming Knesset, the outstanding balance of the loan shall be deducted from the financing of current expenditure that the faction receives in a month.
(d)
(1)From the beginning of the fourth year of the Knesset's term until the determining day, a faction may receive a loan in an amount not exceeding three times the financing of current expenditure it receives in a month, provided that at that time there is no outstanding loan it has received;
(2)the principal of a loan under paragraph (1) shall be repaid in equal instalments by way of deduction from the financing of current expenditure that the faction receives in a month, from the month following the receipt of the loan until the last month in which such expenditure is paid in respect of the Knesset in which the loan was received; nothing therein shall prevent early repayment of the loan;
(3)where the term of the Knesset ends before the end of its full term pursuant to section 9 of Basic Law: The Knesset, the repayment period of the loan shall be recalculated accordingly.
(e)A request for a loan shall be submitted by the faction to the Speaker of the Knesset and shall specify the amount of the loan requested and the repayment period.
(f)The Speaker of the Knesset shall not approve the grant of a loan under this section to a new faction that has not yet repaid a loan it took from a banking corporation under section 7a, unless it has presented to him, to his satisfaction, a plan for the repayment of the loan.
(g)Interest in shekels shall be added to the repayment of the loan under this section, and the provisions of the Interest and Linkage Adjudication Law shall apply with respect to such interest, with the necessary modifications.
(h)A debt remaining to a faction or a party in respect of a loan under this section that cannot be deducted pursuant to the provisions of this section shall be returned by the faction without delay, and if it has not done so, the debt shall be deducted from any amount due to the faction or the party from the State Treasury under this Law or under any other law; nothing in the provisions of this subsection shall derogate from the right to bring a claim for the recovery of the debt under any law; the Speaker of the Knesset shall notify the Minister of Finance, the Minister of Justice and the Minister of the Interior of a debt as aforesaid that has not been returned.
(i)The Knesset Committee shall not approve changes in the factional composition of the Knesset or the representation of a new party in the Knesset unless it has satisfied itself that its decision will not prevent the repayment of a loan under this section.
Limitation of Revenue§
8.
(a)A faction, party or list of candidates shall not receive, directly or indirectly, any donation from a corporation whether in Israel or abroad; for the purposes of this provision, "corporation" – including a registered partnership.
(b)A faction, party or list of candidates shall not receive, directly or indirectly, any donation in an amount or amounts exceeding NIS 1,100 per year from a person and the members of his household who are dependent on him.
(c)For a year in which elections to the Knesset or elections to all local authorities are held, the amount of NIS 2,800 shall replace the amount referred to in subsection (b).
(c1)A party that is not represented in the Knesset shall not receive a donation as referred to in subsections (b) or (c) in an amount exceeding five times the amounts specified in those subsections.
(c2)Notwithstanding the provisions of subsections (c) and (c1), a party or faction that submitted a list of candidates and did not win any seats may receive a donation as referred to in subsection (a), in the 12 months following the day of elections, in an amount not exceeding ten times the amount specified in subsection (c), all for the purpose of covering its debts arising from the elections.
(d)(Repealed)
(d1)A faction or party shall not receive, directly or indirectly, donations other than from a voter as defined in the Elections Law.
(d2)A faction or party shall not receive, directly or indirectly, donations given anonymously; for this purpose, a donation given by a person whose identity and address have not been examined and verified by the faction or party or on their behalf shall be treated as a donation given anonymously.
(d3)A faction or party shall not receive, directly or indirectly, a donation in banknotes or coins.
(e)
(1)Where the State Comptroller has found that a faction or party has received a donation in contravention of the provisions of this section, the faction or party shall transfer to the State Treasury, at a time to be determined by the State Comptroller, an amount equal to twice the amount of the donation; however, the State Comptroller may determine that the faction shall transfer to the State Treasury a lesser amount, if it appears to him that it is appropriate to do so having regard to the circumstances of the case;
(2)where there was no credit balance in the bank accounts of the faction for the purpose of transferring the amount to the State Treasury, the State Comptroller shall notify the Speaker of the Knesset thereof and the Speaker of the Knesset shall withhold from the faction the amount due from it as aforesaid and shall return it to the State Treasury.
(f)A faction or party shall publish the names of donors and the amounts of donations, as the State Comptroller shall direct.
(g)Where a faction or party has received a donation in contravention of the provisions of this section or in an amount exceeding the maximum permissible amount thereunder, it shall return to the donor, immediately upon becoming aware thereof, the donation or the portion thereof that exceeds the permissible amount, and if it is not possible to do so, it shall transfer the amount it is required to return to the State Treasury through the Accountant of the Knesset; where a faction or party has acted in accordance with the provisions of this subsection, the donation shall not be regarded as a donation received in contravention of the provisions of this Law.
Donation from a Kibbutz or Agricultural Association§
8a.
Donations to a faction or party from a kibbutz or an agricultural association that are made in lieu of personal donations from their members, and which in the opinion of the State Comptroller are in a reasonable amount in the circumstances of the matter, shall not be regarded as donations from a corporation for the purposes of section 8; for this purpose –
"kibbutz" – including a cooperative moshav and any cooperative society for settlement whose revenues are not distributed in the main to its members;
"agricultural association" – any other agricultural cooperative society whose members have personally authorised it to donate to a faction.
Cultural and Educational Enterprises – Donations and Expenditure§
8b.
(a)A donation to a cultural or educational enterprise of a faction or of a party or of a body associated with a faction (hereinafter – cultural enterprise), which serves an educational or cultural purpose in the circumstances of the matter, shall not be regarded as a donation for the purposes of section 8, subject to the provisions of subsection (c).
(b)Where the State Comptroller has determined that an expenditure of a cultural enterprise served to finance election propaganda or party activity, the expenditure shall be regarded as expenditure of the faction or of the party.
(c)Where the State Comptroller has so determined as referred to in subsection (b), and has subsequently again determined that the cultural enterprise has again incurred such expenditure, the expenditure shall be treated as if it were received from a donation, and the State Comptroller may determine that the donation is a prohibited donation under section 8 and the provisions of subsection (a) shall not apply to the cultural enterprise.
(d)Where the State Comptroller has so determined as referred to in subsection (c), the recipient of the donation under this section shall not be charged with an offence unless the State Comptroller has notified the cultural enterprise that subsection (a) does not apply to it.
Donation in Case of Waiver of Financing§
8c.
Where a list of candidates or a faction has delivered, not later than the day of presentation of the lists of candidates pursuant to the Elections Law or the determining day, whichever is later, a written notice to the Speaker of the Knesset that it does not wish to receive financing of election expenditure under this Law, they shall be treated as if section 8(c) stated NIS 150,400, and they shall not be entitled to financing of election expenditure in that Knesset election campaign.
New Party Submitting a List of Candidates§
8d.
(a)A party that is not represented by a faction in the outgoing Knesset and that has submitted a list of candidates shall be entitled, within 14 days from the day of submission of the list, to receive a donation from an association of persons, whether incorporated or unincorporated, that existed prior to the registration of the party and the majority of whose members are among the founders of the party, provided that –
(1)the source of the donation is funds received by that association of persons, within the limits prescribed in section 8 in respect of a faction;
(2)that association of persons maintained a system of accounts from the day of its establishment or for a period of one year prior to the submission of the list of candidates, whichever is the later date.
(b)The system of accounts referred to in subsection (a) shall be delivered to the State Comptroller together with the accounts of the faction or list of candidates pursuant to section 10(a).
(c)The State Comptroller shall have, in relation to an association of persons as aforesaid, the same powers as are conferred upon him in relation to a faction pursuant to sections 9(b) and (c).
Application of Restrictions on Donations, Expenditure and Loans§
8e.
Without prejudice to the generality of the provisions of sections 7 to 8d, it is immaterial whether the donations or loans were given to a faction, a party, a list of candidates, a candidate for the Knesset, or any other person acting on their behalf and in connection with them, or whether the expenditure was incurred by a faction, party, list of candidates, candidate or a person as aforesaid.
8f.§
(Repealed — תשס״ג)
Maintenance of Accounts§
9.
(a)From the fifteenth day after the determining day and for as long as a faction is entitled to financing for its expenditure –
(1)the faction shall maintain a system of accounts in accordance with the directives of the State Comptroller and shall record therein its income and expenditure in accordance with those directives;
(2)the faction shall hold the funds designated for its expenditure in the bank accounts referred to in section 6(a)(3).
(b)The system of accounts and the bank accounts referred to therein shall be subject to audit by the State Comptroller, and for this purpose the State Comptroller shall have all the powers conferred upon him in relation to an audited body by a Basic Law or by or pursuant to any law.
(b1)The provisions of section 28w(d) of the Parties Law, 5752-1992, shall apply, with the necessary modifications, to a donation by means of payment instrument as defined in the Payment Services Law, 5779-2019, given pursuant to this Law.
(c)The State Comptroller may at any time require representatives of a faction to submit a declaration, signed by them, as to the completeness or accuracy of the entries in the system of accounts or as to the nature or character of a particular item of income or expenditure; such a declaration may be given to the best of the knowledge of the declarants or to the best of their knowledge and belief, and the Comptroller may, in his discretion, accept such a declaration as evidence.
(d)Upon the demand of at least one-sixth of the members of a faction, the faction shall make the system of accounts referred to in subsection (a) available for their inspection.
(e)(Repealed)
(f)(Repealed)
(g)From the determining day, the provisions of this section shall apply also to a party, with the necessary modifications.
Penal Provisions§
9a.
(a)A person who does any of the following is liable to one year's imprisonment:
(1)knowingly gives a financial commitment otherwise than in accordance with an authorisation given and published pursuant to section 6a;
(2)knowingly fails to comply with a demand pursuant to section 10b;
(3)knowingly gives a donation in contravention of the provisions of this Law;
(4)knowingly receives on behalf of a faction or on behalf of a list of candidates a donation in contravention of the provisions of this Law.
(5)carries out election activity with a total value of NIS 601,700 without having registered as an active elections body, in contravention of the provisions of section 10c(a), or without having incorporated, in contravention of the provisions of section 10c(c)(1), or failed to deliver to the State Comptroller a report on the system of accounts it maintained, in contravention of the provisions of section 10c(j), with intent to defraud.
(b)A person who knowingly submits a declaration pursuant to section 9(c) that is false in a material particular is liable to three years' imprisonment.
(c)A person who gave an instruction to incur expenditure or who approved the incurring of expenditure and is authorised to do so on behalf of the faction or list of candidates, knowing that the expenditure would result in an excess of the provisions of section 7 and the instruction was carried out, is liable to one year's imprisonment or to the fine referred to in section 61(a)(3) of the Penal Law, 5737-1977, provided that the faction or list of candidates exceeded the permitted expenditure pursuant to section 7.
State Comptroller's Reports§
10.
(a)Within 24 weeks from the day on which the election results were published, the representatives of a faction or list of candidates shall deliver to the State Comptroller its accounts for the election period; if they have not done so, and the State Comptroller has notified the Speaker of the Knesset that in his opinion there was no reasonable justification for their failure to act, the Speaker of the Knesset shall direct that no payment be made to that faction or list of candidates pursuant to this Law until the State Comptroller notifies him that accounts have been submitted to him and that the faction or list of candidates has apparently maintained a system of accounts in accordance with his directives; if the State Comptroller notifies him that accounts have been submitted after the Speaker of the Knesset has so directed, the payment that was not made to the faction or list of candidates pursuant to this subsection shall be paid to it, less an amount as the State Comptroller shall recommend, not exceeding 15% of the payment due to it.
(b)Within 24 weeks after receiving the accounts referred to in subsection (a), the State Comptroller shall deliver to the Speaker of the Knesset a report on the results of the audit of the accounts and shall state therein –
(1)whether the faction or list of candidates maintained a system of accounts in accordance with his directives;
(2)whether the expenditure of the faction or list of candidates and its income during the election period were within the limits referred to in section 7 and in section 8.
(c)No later than 1 May following the end of each financial year, the representatives of a faction or list of candidates shall deliver to the State Comptroller its accounts for that year; if they have not done so, and the State Comptroller has notified the Speaker of the Knesset that in his opinion there was no reasonable justification for their failure to act, the Speaker of the Knesset shall direct that no payment be made to that faction or list of candidates pursuant to this Law until the State Comptroller notifies him that accounts have been submitted to him and that the faction or list of candidates has apparently maintained a system of accounts in accordance with his directives; if the State Comptroller notifies him that accounts have been submitted after the Speaker of the Knesset has so directed, the payment that was not made to the faction or list of candidates pursuant to this subsection shall be paid to it, less an amount as the State Comptroller shall recommend, not exceeding 15% of the payment due to it.
(c1)For the purposes of this section –
(1)a year in which elections to the Knesset are held shall be deemed to end at the close of the month in which the election results were published, and the accounts pursuant to subsection (c) shall be delivered together with the accounts pursuant to subsection (a);
(2)the year following the elections shall be deemed to commence at the beginning of the month after the publication of the election results and to end at the close of the following financial year.
(d)No later than 1 October in each year the State Comptroller shall deliver to the Speaker of the Knesset a report on the results of the audit of the accounts referred to in subsection (c); however, if the accounts referred to in subsection (c1)(1) were submitted at the time referred to therein, the State Comptroller shall deliver the report at the time referred to in subsection (b); a report pursuant to this subsection shall state –
(1)whether the faction or list of candidates maintained a system of accounts in accordance with his directives;
(2)whether the expenditure of the faction or list of candidates and its income in that year were within the limits referred to in section 7 and in section 8.
(d1)The accounts delivered pursuant to this section shall be accompanied by an opinion of the auditor of the faction or of the list of candidates as to their regularity and completeness and as to the maintenance of a system of accounts in accordance with the directives of the State Comptroller.
(e)
(1)If the report pursuant to subsection (b) is not positive – the Speaker of the Knesset shall withhold from the faction, in equal instalments over six months, from the monthly financing received by the faction in respect of current expenditure, an amount equal to 15% of the amount of election financing paid to it pursuant to section 3; if the report pursuant to subsection (d) is not positive – the Speaker of the Knesset shall withhold from the faction or list of candidates for six months one-half of the monthly financing received by the faction in respect of current expenditure;
(2)Notwithstanding the provisions of paragraph (1), if the report pursuant to subsection (b) or (d) was not positive by reason of an excess of the amounts determined pursuant to section 7(a) or (b), the Speaker of the Knesset shall withhold one-third of the amount of the excess, provided that the amount withheld shall not exceed 20% of the amount to which the faction or list of candidates is entitled pursuant to section 2(a)(1) or the annual amount to which the faction or list of candidates is entitled pursuant to section 2(a)(2), as the case may be; the withholding shall be made from the payments next due for financing the current expenditure of the faction or list of candidates, as the case may be, but shall not exceed one-half of the monthly financing received by the faction in respect of current expenditure per month;
(3)Notwithstanding the provisions of paragraph (1), if a faction or list of candidates maintained a system of accounts in accordance with the directives of the State Comptroller but without full compliance therewith, the Speaker of the Knesset shall withhold from the payments next due for financing the current expenditure of the faction or list of candidates, as the case may be, amounts smaller than those specified in paragraph (1), as the State Comptroller shall recommend having regard to the nature and extent of the deviation, and the same shall apply to a faction or list of candidates that exceeded the amounts determined in section 7 or that received a donation in contravention of the provisions of section 8 and the State Comptroller found circumstances by reason of which it is appropriate to treat it as provided in this paragraph; the withholding shall not exceed one-half of the monthly financing received by the faction in respect of current expenditure per month;
(4)(deleted)
(5)The withholding of amounts pursuant to this subsection shall take precedence over any deduction pursuant to this Law or pursuant to the Local Authorities (Elections Financing) Law, 5753-1993;
(6)The State Comptroller may decide, upon the application of a faction or list of candidates, that the recovery of amounts withheld from it pursuant to this subsection shall be spread over a period to be determined by him that is longer than that prescribed in this section, but not beyond the end of the term of that Knesset;
(7)If the term of the Knesset ends before the amount withheld pursuant to this subsection has been fully deducted, the balance of the amount shall be deducted from the advance to which the faction is entitled pursuant to section 4;
(8)The Speaker of the Knesset shall transfer to the State Treasury amounts withheld by him pursuant to this section.
(9)Remuneration and other payments made to faction employees from the Knesset budget pursuant to section 3a shall not be withheld pursuant to section 8 or pursuant to this section.
(f)The Finance Committee of the Knesset may, with the consent of the State Comptroller, extend any of the time limits referred to in this section and in section 10c(j) and (l); the decision of the Committee shall be published in Reshumot (Official Gazette).
Body Associated with a Faction§
10a.
(a)For the purposes of section 7, the expenditure of a body associated with a faction shall be regarded as the expenditure of the faction.
(b)For the purposes of section 8 –
(1)a donation received by a body associated with a faction shall be deemed to have been received by the faction;
(2)a donation received by a faction from a body associated with a faction shall not be regarded as a donation from a corporation.
(c)The provisions of section 9 in relation to a faction shall also apply in relation to a body associated with a faction; at the time of delivery of the accounts of a faction pursuant to section 10, the accounts of every such body shall also be delivered.
Ancillary Powers of the Auditor§
10b.
The auditor of the faction or of the list of candidates may at any time require its representatives to furnish him with information, documents, explanations and any other material required by him for the purposes of auditing the accounts.
Active Elections Body§
10c.
(a)No person or association of persons, whether incorporated or unincorporated, shall carry out election activity with a total value, in money or money's worth, exceeding NIS 120,400, nor shall such person or association raise donations for that purpose of a total value as aforesaid, unless it has registered with the State Comptroller, as the Comptroller shall determine, as an active elections body whose purpose is the carrying out of election activity.
(b)The State Comptroller shall not register a body pursuant to subsection (a) unless all of the following conditions are met:
(1)if it is a corporation – it is an association or a public benefit company;
(2)it has provided the State Comptroller with the details of a website for the publication of information that it is required to publish pursuant to this section;
(3)it has authorised one or two persons to act on its behalf as an active elections body in all matters relating to its dealings with State authorities and has published their names on its website, together with their written consent to serve in that capacity (in this section – the authorised party).
(c)No person or association of persons shall carry out election activity with a total value, in money or money's worth, exceeding four times the amount referred to in subsection (a), nor shall such person or association raise donations for that purpose of a total value as aforesaid, unless it has registered with the State Comptroller as referred to in subsection (a) and all of the following conditions are met:
(1)it has registered as an association or a public benefit company whose purpose is the carrying out of election activity, or has submitted an application to register as aforesaid and has completed all that is required of it for registration;
(2)it has appointed an auditor for the purpose of auditing the accounts and preparing a report on its income and expenditure as an active elections body, and has published the name of the auditor on its website, together with the auditor's written consent to serve in that capacity.
(d)For the purpose of calculating the amounts referred to in subsections (a) and (c), election activity or the raising of donations shall be deemed to have been carried out by a single body even if carried out by several bodies, if in the opinion of the State Comptroller, or of the Chairman of the Central Elections Committee in connection with a petition pursuant to subsection (q), as the case may be, those bodies are to be regarded as arms of a single body, having regard to all or some of the following characteristics: the objects of the bodies, their activities, the identity of their owners, managers and members, the allocation of their profits and the sources covering their losses.
(e)
(1)A candidate for the Knesset or a holder of a position in party institutions shall not hold a senior position in an active elections body nor serve as the authorised party on its behalf, and if a person becomes a candidate for the Knesset or a holder of a position in party institutions as aforesaid – that person shall cease to serve in their position in the active elections body or on its behalf;
(2)The authorised party shall continue to serve until another is appointed in their place; if the authorised party resigned by notice to the active elections body and to the State Comptroller, ceased to serve in their capacity pursuant to paragraph (1) or is prevented from fulfilling their duties, and was the only person serving as authorised party, the active elections body shall, within three days from the day it became aware thereof, appoint another authorised party in their place and shall publish that person's name on its website, together with their written consent to serve in that capacity.
(f)
(1)An active elections body that carried out election activity with a total value exceeding the amount referred to in subsection (a), or raised donations for that purpose of a total value as aforesaid, shall not receive, directly or indirectly, during the period between one Knesset election and the next, any donation in an amount or amounts exceeding twice the amount referred to in paragraph (2) from a person and their household dependants;
(2)Notwithstanding the provisions of paragraph (1), if an active elections body carried out election activity of the value referred to in subsection (c) or raised donations for that purpose of the value referred to therein, it shall not from that time receive a donation as referred to in paragraph (1) in an amount or amounts exceeding NIS 18,100;
(3)An active elections body shall not receive, directly or indirectly, a donation in contravention of the provisions of section 8(a), (d1), (d2) and (d3);
(4)Notwithstanding the provisions of paragraph (3), an active elections body may receive a donation from a donor abroad in contravention of the provisions of section 8(d1), provided that the donor is an adult; however, if an active elections body received such a donation, the total donations it receives, in Israel or abroad, during the period between one Knesset election and the next, shall not exceed NIS 722,100, and the total donations it receives from donors abroad pursuant to this paragraph shall not exceed one-third of the total amount of donations received by it during that period;
(5)If an active elections body received a donation in contravention of the provisions of this subsection or in an amount exceeding the maximum amount permitted thereunder, the body shall return to the donor, immediately upon becoming aware thereof, the donation or the portion thereof that exceeds the permitted amount, and if this cannot be done, shall transfer the amount to be returned to the State Treasury through the Knesset Accountant; if the body acted in accordance with the provisions of this paragraph, the donation shall not be regarded as a donation received in contravention of the provisions of this Law.
(g)An active elections body shall publish on its website or on a website determined by the State Comptroller, and in accordance with the directives of the State Comptroller, every donation it received from a donor and every donation it returned to a donor or transferred to the State Treasury, within 14 days from the day it received the donation or from the day it returned or transferred it; however, during the election period an active elections body shall publish such information within seven days.
(h)An active elections body shall maintain a system of accounts in accordance with the directives of the State Comptroller and shall record its income and expenditure in accordance with those directives.
(i)
(1)The auditor of an active elections body appointed pursuant to subsection (c)(2) may at any time require it to furnish him with information, documents, explanations and any other material required by him for the purpose of fulfilling his duties pursuant to this section, and the active elections body shall furnish what is required without delay;
(2)The auditor referred to in paragraph (1) shall continue to serve until another is appointed in their place; if the auditor resigned or is prevented from fulfilling their duties, the active elections body shall, within ten days from the day it became aware thereof, appoint another auditor in their place and shall publish the name of the auditor on its website, together with their written consent to serve in that capacity.
(j)An active elections body shall deliver to the State Comptroller, within the period referred to in section 10(a) or (f), a report on the system of accounts it maintained during the period in which it acted as such a body and up to the date of delivery of the report; an active elections body that carried out election activity of the value referred to in subsection (c) shall attach to the report delivered pursuant to this subsection an opinion of the auditor it appointed pursuant to subsection (c)(2) as to the regularity and completeness of the accounts and as to the maintenance of a system of accounts in accordance with the directives of the State Comptroller.
(k)An active elections body shall notify the State Comptroller, within the period referred to in subsection (j), of any database it created.
(l)Within the period referred to in section 10(b) or (f), the State Comptroller shall deliver to the Speaker of the Knesset a report on the results of the audit of the system of accounts of an active elections body, and shall state therein whether the body maintained a system of accounts in accordance with his directives, whether the donations it received were within the limits prescribed in subsection (f) and whether it submitted the notifications and reports required under this section.
(m)The State Comptroller may require from an active elections body and from any person information and documents required by him for the preparation of a report and for the clarification of the connection between an active elections body and another body or person, and every such body or person shall furnish such information and documents without delay.
(n)Notifications to be delivered to the State Comptroller pursuant to this section shall be given in the manner determined by the Comptroller, and he may at any time determine that a notification shall be accompanied by an affidavit in accordance with section 15 of the Evidence Ordinance [New Version], 5731-1971, attesting to the accuracy and completeness of the matters stated therein.
(o)If the State Comptroller finds that an active elections body has done any of the following, the body shall transfer to the State Treasury, within thirty days of the day on which the State Comptroller notified it of this, an amount as set out below, as the case may be, and the State Comptroller may reduce the amount if he considers that there are reasons justifying such reduction:
(1)carried out election activity without being registered as an active elections body, contrary to the provisions of subsections (a) and (b), or without having been incorporated, contrary to the provisions of subsection (c)(1) – an amount equal to five times the maximum permitted donation amount under subsection (f)(2);
(2)received a donation contrary to the provisions of subsection (f) or did not publish a donation at the time prescribed in subsection (g) – an amount equal to twice the amount of the donation;
(3)did not submit to the State Comptroller a report on the accounting system it maintained as referred to in subsection (j) – an amount equal to five times the maximum permitted donation amount under subsection (f)(2);
(4)was late in submitting a report to the State Comptroller on the accounting system it maintained as referred to in subsection (j), did not submit to the Comptroller information and documents that the Comptroller required as referred to in subsection (m), or did not comply with the provisions relating to the maintenance of the accounting system as prescribed in this section or in the guidelines of the State Comptroller – an amount equal to three times the maximum permitted donation amount under subsection (f)(2);
(5)did not notify the State Comptroller of a database it created as referred to in subsection (k) – an amount equal to five times the maximum permitted donation amount under subsection (f)(2);
(6)was late in notifying the State Comptroller of a database it created as referred to in subsection (k) – an amount equal to twice the maximum permitted donation amount under subsection (f)(2);
(7)did not appoint an authorised person or an auditor in place of those who have ceased to serve as referred to in subsections (e)(2) and (i)(2) – an amount equal to three times the maximum permitted donation amount under subsection (f)(2).
(p)Notwithstanding the provisions of section 3(a) of the Fines, Fees and Costs Collection Authority Law, 5755-1995, an amount to be transferred to the State Treasury under subsection (o) shall be paid by an active elections body to the Fines, Fees and Costs Collection Authority by the end of the period prescribed in that subsection, even if the date of its payment has not yet arrived; however, the Fines, Fees and Costs Collection Authority shall not take collection proceedings under that Law until after the deadline for payment of the debt has passed.
(q)The Chairman of the Central Elections Committee for the Knesset may, at the request of a party represented in the Knesset or a party that has submitted a list of candidates in elections to the incoming Knesset, and after giving the person concerned an opportunity to present his arguments before him, issue an Order preventing the violation of any provision of this section or of guidelines issued by the State Comptroller thereunder; the provisions of sections 17b and 17e(b) of the Elections (Methods of Propaganda) Law, 5719-1959, and the rules of procedure prescribed under section 17e(a) of that Law, shall apply to proceedings on a petition for an Order and to an Order under this subsection, with the necessary modifications.
(r)
(1)Nothing in the provisions of this section shall derogate from any duty imposed on a faction or a party or from any prohibition under any law;
(2)Nothing in the provisions of this section shall prejudice the authority of the State Comptroller under any law, including the authority to determine that a body is a body associated with a faction even if it is an active elections body, and the authority to determine that the activity of an active elections body constitutes a prohibited donation to a faction or to a party.
Opinion§
11.
(a)A faction may at any time request from the Chairman of the Central Elections Committee an opinion as to whether a particular expenditure or a particular category of expenditure constitutes election expenditure; the Chairman of the Central Elections Committee shall give the opinion after consulting with his deputies, unless he considers the matter to be urgent.
(b)An opinion shall be given within seven days and shall be transmitted to the Speaker of the Knesset, to the State Comptroller, to the faction that requested the opinion and to all other factions.
(c)A faction may at any time request from the State Comptroller an opinion as to whether a particular expenditure or a particular category of expenditure constitutes current expenditure; the opinion shall be given within twenty-one days and shall be transmitted to the Chairman of the Central Elections Committee, to the Speaker of the Knesset, to the faction that requested the opinion, and if the State Comptroller considers it desirable – also to the other factions.
Status of Parties Maintaining a Single Faction§
12.
(a)If a faction is a combination of two or more parties that submitted a joint list of candidates and that maintain a single faction in the Knesset, those parties shall be regarded as if they were separate factions in all matters relating to the financing of current expenditure, to a loan under section 7c and to a donation under section 8, except for a donation in a year in which elections to the Knesset are held.
(b)The payments for the financing of current expenditure shall be paid to the separate factions maintaining a faction that is a combination as referred to in subsection (a) in accordance with the party affiliation of their members as submitted upon the submission of the joint list of candidates as referred to in section 57(b) of the Elections Law; if the number of members of a separate faction as aforesaid changes due to the termination of a faction member's tenure in the Knesset, the financing of current expenditure shall change accordingly in accordance with the party affiliation of the faction members on the day of payment of the financing of current expenditure, unless all the separate factions concerned have notified, before that date, that the financing of current expenditure shall not change.
(c)Where factions have merged pursuant to section 60 of the Knesset Law, the provisions of subsections (a) and (b) shall apply to them, with the necessary modifications.
(d)
(1)Notwithstanding the provisions of subsection (b), a portion of the monthly financing under section 3(c) to which a separate faction is entitled may be paid to another separate faction in the same combination of parties, provided that the payment is pursuant to a current financing agreement; the portion of the financing as aforesaid shall be denominated in percentages of the financing unit and shall not exceed the rate of financing for one mandate as referred to in section 3(c), or a higher rate if a change has occurred in the number of members of the separate factions during the term of the Knesset, and the parties have stipulated in such an agreement that the financing of current expenditure shall continue to be paid in accordance with the party affiliation as submitted upon the submission of the joint list of candidates as referred to in section 57(b) of the Elections Law;
(2)A current financing agreement that has been submitted to the Chairman of the Central Elections Committee may not be amended or cancelled during the term of that Knesset; the agreement shall remain in force also in the event of the splitting of the faction pursuant to section 59(2) of the Knesset Law, unless the factions have expressly stipulated in the agreement as referred to in paragraph (1) that in the event of a split, each faction shall be paid the financing of current expenditure to which it is entitled under section 3(c).
Changes in the Composition of Factions§
13.
(a)If a faction in the Knesset has split pursuant to the provisions of sections 59 and 60 of the Knesset Law, the financing of current expenditure of the parts that have split shall be calculated in accordance with the new number of members, commencing in the month following the month in which the Knesset Committee approved the change.
(b)In any other case, Members of the Knesset who have broken away from a faction shall not be entitled to financing of current expenditure, and the financing of expenditure of the faction from which they broke away shall not change.
(c)The provisions of subsection (a) shall not apply to the splitting of a faction in the Knesset pursuant to the provisions of section 59(1) of the Knesset Law that took place in the first two years following the commencement of the Knesset's term or from the determining day onwards, and the provisions of subsection (b) shall apply in this regard, unless the notice of the split was submitted to the Knesset Committee, pursuant to the provisions of section 60 of the Knesset Law, by a majority of the faction's members or with their consent.
(c1)From the financing of current expenditure under section 3(c) of the part that has split as referred to in subsection (a), an amount shall be deducted equal to the proportion of the total amount of debts and payments as set out below, at the time of payment, proportionate to its relative share in the faction before the split, and the faction from which the part split shall be responsible for the payment of those debts or payments:
(1)a debt arising from an advance received by the faction under section 4(c) in excess;
(2)the balance of a loan granted to the faction under section 7c before the split;
(3)payments withheld from the faction under section 10;
(4)a debt of a parent faction under the Local Authorities (Elections Financing) Law, 5753-1993.
(c2)Where a faction in the Knesset has split pursuant to section 59(1) or (3) of the Knesset Law, an amount shall be deducted from the advance under section 4 of the part that has split equal to the proportion of the total amount of debts and payments as set out in subsection (c1), at the time of payment, proportionate to its relative share in the faction before the split, and the faction from which the part split shall be responsible for the payment of those debts or payments.
(d)
(1)A part that has split from a faction shall participate in the repayment of the debts of the party that that faction represented in the Knesset, proportionate to the amount of financing of current expenditure that was reduced from the faction from which it split as a result of the split; the repayment of the debt shall be from the current expenditure to which the part that split is entitled until the end of the term of that Knesset, excluding the amount of financing for one mandate as referred to in section 3(c); this paragraph shall also apply if the part that split has merged with another faction in the Knesset;
(2)The obligation of participation of a part, as referred to in paragraph (1), shall commence in the period beginning on the day on which it is entitled to financing of current expenditure and shall end on the day of the termination of the term of that Knesset;
(3)The auditor of the faction from which a part split, appointed pursuant to section 5a, shall determine, as soon as possible, the debts of the party for the purposes of this subsection, and shall notify the Speaker of the Knesset and the representative of the part that split accordingly;
(4)The auditor of the faction from which a part split shall allow the representative of the part that split or a person on its behalf to inspect the documents relating to the debts of the party; if there is a dispute regarding the amount of the debts of the party, the dispute shall be brought for the determination of the Speaker of the Knesset, who shall determine the matter within 30 days;
(5)For the purposes of this subsection, "debts of the party" – the difference between its expenditure and its income, during the period in which the part that split, or a portion thereof, was part of the faction, and also for the purposes of the elections to the Knesset to which such part was elected; however, expenditure incurred by a party for the purpose of acquiring rights in assets that remain in its possession after the split shall not be taken into account, and debts or payments as referred to in subsections (c1) and (c2) shall likewise not be taken into account.
(e)(Repealed)
13a.§
(Repealed — תשנ״א)
Joint List of Candidates§
13b.
(a)Parties that have submitted a joint list of candidates shall maintain their accounts for the election period separately, and shall be regarded as if they were separate factions in all matters relating to the financing of election expenditure.
(b)Notwithstanding the provisions of subsection (a), parties that have submitted a joint list of candidates may notify, in a joint notice to the Speaker of the Knesset together with the submission of the notice under section 6(a), that they will maintain their accounts for the election period jointly, and they shall be regarded as if they were a single faction in all matters relating to the financing of election expenditure; where parties have so notified, the accounts that they maintained with respect to the elections before the submission of the notice shall be included in the accounts that they submit to the State Comptroller under section 10(a).
(c)Each of the parties that submitted a joint list of candidates and that are entitled to financing of election expenditure shall participate in the election expenditure.
(d)Parties that have submitted a joint list of candidates shall draw up, before the submission of the list, an election expenditure agreement, which shall relate, inter alia, to the election expenditure, the election budget and the surplus and deficit in the election budget; the parties shall submit the agreement to the Chairman of the Central Elections Committee at the time of submission of the joint list of candidates.
(e)Those submitting a joint list of candidates shall indicate therein, in addition to the representative of the list and his alternate as referred to in section 59 of the Elections Law, also the representative of each of the parties that submitted the list and his alternate for the purposes of this Law.
(f)In a year in which elections to the Knesset are held, parties that submitted a joint list of candidates for those elections shall be regarded as a single faction for the purposes of section 8(c), and if none of the parties is represented in the Knesset – for the purposes of section 8(c1); if parties as aforesaid received a donation in an amount exceeding the maximum donation amount under this subsection before the joint list of candidates was submitted, the provisions of section 8(g) shall apply; the refund of the donation shall be divided among the parties in equal shares or in another manner as agreed in the election expenditure agreement.
(g)
(1)For the purposes of the limitation of election expenditure under section 7, parties that submitted a joint list of candidates shall be regarded as if they were a single faction, whether the election account is maintained separately or jointly, pursuant to the provisions of section 13b(a) or (b); if the parties maintained the election account separately, the limitation of expenditure shall be calculated between them in accordance with the ratio of the number of Members of the Knesset affiliated with each of them on the determining day as referred to in section 4(a)(1);
(2)Notwithstanding the provisions of paragraph (1), where a current financing agreement has been entered into, the number of Members of the Knesset affiliated with each of the factions on the determining day shall be regarded as if it were the number according to the rate of monthly financing in accordance with the agreement on the determining day, and the number shall not be rounded; if the agreement stipulates that the provisions of section 3(b2) shall not apply, the provisions of this paragraph shall likewise not apply.
(h)If parties that submitted a joint list of candidates maintained their accounts for the election period separately, and the State Comptroller considers that an expenditure or income relating to the joint list of candidates cannot be attributed to any of them, that expenditure or income shall be attributed in the report under section 10 to each of the parties according to its proportion of the total actual election expenditure.
(i)If parties that submitted a joint list of candidates maintained their accounts for the election period jointly and the report under section 10(b) was not positive, the State Comptroller may determine that the withholding of payments under section 10(e) shall be attributed to one or more of the parties, as he shall determine.
Report on a Faction that Received an Advance and Did Not Win a Mandate§
13c.
(a)A faction that received an advance for the financing of election expenditure under section 4(a) and did not win a mandate in the elections shall continue to be subject to the provisions of this Law for the purpose of the audit of its accounts for the election period under section 10.
(b)If the report of the State Comptroller under section 10(b) on a faction as referred to in subsection (a) is not positive, those who were the representatives of the faction shall be jointly and severally liable to repay to the State Treasury 15% of the advance that the faction received.
(c)(Repealed)
Report on a Faction that Received Current Financing and Has Ceased to Exist§
13d.
(a)A faction that has ceased to exist before the deadline for the submission of its accounts to the State Comptroller under section 10(c), as a result of a split or merger as referred to in section 13(a) or the resignation of its members from membership in the Knesset, those who were the representatives of the faction shall submit to the State Comptroller, within ten weeks of the date on which the faction ceased to exist, the accounts of the faction in respect of its income and current expenditure in that part of the year in which it existed as a faction; however, if it ceased to exist because it did not again win mandates in elections, its accounts shall be submitted as referred to at the time referred to in section 10(c1)(1).
(b)Within twelve weeks after receiving accounts as referred to in subsection (a), or if received at the time referred to in section 10(c1)(1) – by the time referred to in section 10(d), the State Comptroller shall submit to the Speaker of the Knesset a report on the results of the audit of the accounts, as referred to in section 10(d); for this purpose, the limitation of expenditure under section 7(b) shall be calculated according to the ratio between the length of the period to which the accounts relate and a full year.
(c)If the report under subsection (b) is not positive, those who were the representatives of the faction shall be jointly and severally liable to repay to the State Treasury 15% of the monthly financing that the faction received under this Law in the period to which the report relates.
Repayment by a Faction that Has Ceased to Exist§
13e.
A faction that has ceased to exist after having received financing under this Law, those who were its representatives shall return the balance of the amounts in their possession, after having paid its debts, to the State Treasury.
Notifications by a Faction§
14.
(a)Notifications and declarations of a faction under this Law shall be made by the representative of the faction or his alternate designated pursuant to section 25 of the Elections Law or, in relation to separate factions, designated pursuant to subsections (b) or (c).
(b)The representatives of the parties that submitted a joint list of candidates and their alternates, as referred to in section 13b(e), shall be the representatives of the separate factions in the Knesset that maintain a single faction and their alternates.
(c)Where factions have merged pursuant to section 60 of the Knesset Law, the factions shall notify the Knesset Committee in writing, at the time of the merger, in addition to the notice under section 25(a1) of the Elections Law, who are the representatives of the separate factions and their alternates for the purposes of this Law.
(d)Each separate faction may, at any time, by written notice to the Speaker of the Knesset, replace its representatives and their alternates; the notice shall be submitted by the representative of the separate faction or his alternate, unless a majority of the members of the separate faction have notified otherwise.
(e)Notice of the representatives of separate factions and their alternates under this section and of any change in them shall be published in Reshumot (Official Gazette) on behalf of the Knesset.
(f)The provisions of section 63 of the Knesset Law shall apply, with the necessary modifications, to a faction or a separate faction whose members are in dispute as to who represents it.
Prevention of Charge and Attachment§
15.
The amounts due to a faction under this Law are not capable of being subjected to a charge (security interest) or attachment.
16.§
(Repealed — תשע״ה)
Amounts Received from the Histadrut and Loan to a Faction in the Histadrut§
17.
(a)
(1)Amounts received by a faction as a result of a decision of the General Federation of Labour in the Land of Israel for the financing of its election campaign and that of the professional unions organised within it and for the purposes of the parties appearing in it in accordance with their representative size (hereinafter – the amounts), shall not be regarded as a donation under section 8, provided that the faction did not exceed what is stated in section 7(d);
(2)Expenditure incurred by a faction in connection with an election campaign or in connection with its ongoing activity in the General Federation of Labour in the Land of Israel and the professional unions organised within it (hereinafter – the activity), shall not be regarded as current expenditure under section 7(d), provided that the faction attributed the expenditure to the activity in the manner it practised on the eve of the commencement of this Law; no change in the attribution as aforesaid shall be made except with the approval of the State Comptroller.
(b)Notwithstanding the provisions of subsection (a), the provision of section 7(d) shall not apply to the amounts if the faction expended them for the purposes of the activity only, held them separately and reflected them in its accounts in a manner that enables the State Comptroller, by accepted auditing methods, to identify them clearly, to verify them and to total them, and also recorded in that manner the transactions constituting the expenditure of the amounts; use of the amounts or any part of them otherwise than for the purposes of the activity shall be regarded as receipt of a donation under the provisions of section 8.
(c)A faction or a party may grant a loan to a faction in the Histadrut as referred to in subsection (a) or to a list of candidates competing in elections to that Histadrut, for the purpose of financing its election campaign in that Histadrut, provided that the faction in the Histadrut or the list of candidates is associated with it and identified with it; on the repayment of the loan, shekel interest shall be added, and the provisions of the Interest and Linkage Adjudication Law shall apply in relation to that interest, with the necessary modifications.
17a.§
(Repealed — תשנ״ד־4)
18.§
(Repealed — תשע״ז)
19.§
(Repealed — תשנ״ד־4)
Implementation§
20.
The Speaker of the Knesset is responsible for the implementation of this Law.
Commencement§
21.
This Law shall come into force on the 27th of Tevet 5733 (1 January 1973).
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LawConstitutional & Basic Laws
חוק מימון מפלגות, תשל"ג-1973
Party Financing Law
Party Finance Law
Mimun Miflaga
Political Party Financing
Campaign Finance Law
Election Finance Law
Political Funding Law
Party Donations Law
Political Party Funding