War Damage Rehabilitation by means of Urban Renewal Law, 5786-2026
חוק שיקום נזקי מלחמה בדרך של התחדשות עירונית, תשפ"ו-2026
Published: 2026-04-05Consolidated Hebrew text as of 2026-08-13 · Last amended 2026-04-05✓ Amendment status checked against the Knesset legislation record on 2026-09-28
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Section E: Assistance of the Compensation Fund
State Assistance for the Acquisition of Rights§
45.
(a)A rehabilitation developer who has undertaken to acquire the rights of an apartment owner in accordance with the provisions of section 44 may request from the property tax administrator the amount that the developer is required to pay to that apartment owner under that section, in whole or in part, but not more than the acquisition amount referred to in section 44(a) and (d) (in this section – financing assistance); the property tax administrator shall provide financing assistance to the developer, within 90 days of the date on which the request was submitted, if all of the following conditions are met:
(1)at the time of the developer's approval as a rehabilitation developer, the property tax administrator confirmed that the developer meets the requirements set by the property tax administrator in guidelines concerning the assurance of the developer's ability to repay the financing assistance;
(2)the developer meets the requirements under sections 2 and 2a of the Public Bodies Transactions Law, 5736-1976;
(3)guarantees have been provided to the satisfaction of the property tax administrator regarding the assurance of repayment of the financing assistance.
(b)
(1)Where a rehabilitation developer has received the financing assistance and a new condominium has been built in accordance with the rehabilitation and renewal plan applicable to the land on which the apartment acquired under an exit agreement was built, the developer shall be obliged to repay the financing assistance no later than 30 days from the date of receipt of a completion certificate under the provisions of the Planning Law, with the addition of linkage differentials at the rate of index increase as defined in the Property Tax Law, from the date of the provision of the financing assistance until the date of repayment;
(2)notwithstanding the provisions of paragraph (1), the rehabilitation developer may request from the property tax administrator, within the period referred to in that paragraph, that the administrator approve that instead of repaying the amount referred to in that paragraph, the developer shall return the value of the consideration apartment, and if the value of the consideration apartment was lower than the amount referred to in subsection (a) – the value of the consideration apartment plus 20% of the difference between the value of the consideration apartment and the amount referred to therein; if the rehabilitation developer chooses to return the value of the consideration apartment, the developer may not retract that choice; for this purpose, "value of the consideration apartment" means the value at the time of delivery of the consideration apartment that the owner of the apartment whose apartment was acquired would have received, based on the average value of consideration apartments received by apartment owners with characteristics similar to those of the developer's apartment, as determined by the Chief Government Valuer;
(3)where a real property valuation has been determined under the provisions of paragraph (2), the developer may file an objection to the valuation with the objections committee, within 15 days of the date on which the valuation was delivered to the developer, and the provisions of section 9a of the Land Ordinance shall apply in this regard, with the necessary modifications; upon the submission of the objection, the developer shall return the undisputed value of the consideration apartment as stated in the objection.
(c)Notwithstanding the provisions of subsection (b) –
(1)if a permit application has not been received within 14 months of the date of approval of a rehabilitation and renewal plan, or if construction work has not commenced in accordance with a permit granted within 10 months of the date of issuance of the permit, linkage differentials and interest as defined in the Property Tax Law shall be added to the amount referred to in that subsection, from the expiry of the said periods until the date of receipt of the permit application or the commencement of construction work, as the case may be;
(2)if a permit application has not been received within 26 months of the date of approval of a rehabilitation and renewal plan, or if construction work has not commenced within 12 months of the date of issuance of the permit, linkage differentials and interest as defined in the Property Tax Law shall be added to the amount referred to in that subsection, however the interest addition shall be at the rate of 6% per annum;
(3)if the construction of all the condominiums in the rehabilitation and renewal area has not been completed within six years from the date on which the financing assistance amount was paid to the rehabilitation developer, the rehabilitation developer shall return the said amount to the compensation fund as defined in section 2a of the Property Tax Law (in this Chapter – the compensation fund); the property tax administrator may, by a reasoned decision, extend the said period.
(d)The property tax administrator, in consultation with the director of the Urban Renewal Authority, may reduce the rate of interest and linkage differentials and interest under paragraphs (1) and (2) of subsection (c), or waive them entirely, if it has been proved to the administrator's satisfaction that the delay in the receipt of the permit application or in the commencement of construction work was caused by reasons beyond the control of the rehabilitation developer.
(e)The provisions of the Tax Ordinance (Collection) shall apply to the repayment amount referred to in subsections (b) or (c), except for section 11a(1) of that Ordinance, as if it were a tax, and the provisions of the Tax Set-Off Law, 5740-1980, as if it were a tax debt.
Source of State Participation§
46.
The compensation fund shall finance all of the following:
(1)the financing assistance amount as defined in section 45, and the amounts returned by the rehabilitation developer under that section shall be added to the compensation fund and shall form part thereof;
(2)participation in the financing of the project, to the extent required under the opinion of the director of the Urban Renewal Authority, after the director has carried out an economic examination of the project and found that it is not economically viable; the participation amount shall not exceed the cost of rehabilitating the damage.
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Contact Us →Chapter V: Consent to the Performance of Work and Remedies in the Absence of Consent
Provisions regarding the Performance of Work in a Rehabilitation Area§
47.
(a)Where a rehabilitation developer has been approved and the consent or decision of an apartment owner or plot owner in a rehabilitation and renewal area is required by law for the performance of work whose purpose is the construction of a new building in a rehabilitation and renewal area or other work for the purpose of implementing a rehabilitation and renewal plan (in this Chapter – performance of work), the provisions of this Chapter shall apply in respect of obtaining the consent or decision for the performance of work as aforesaid.
Remedies for the Performance of Work§
48.
(a)In this section –
"person with a disability" and "adaptations" – as defined in section 2(c) of the Evacuation-Construction Law;
"court" – the District Court;
"rehabilitation developer" – any of the following:
(1)a rehabilitation developer approved under section 40(a)(1) or (2);
(2)a rehabilitation developer approved under section 40(a)(3), in respect of whom the director has determined that the conditions referred to in section 43(b)(1) are met;
"evacuation-construction valuer" – as defined in the Evacuation-Construction Law;
"plan" – a plan applicable in a rehabilitation and renewal area, being one of the following: an approved plan or a plan that has been deposited or in respect of which a decision to deposit has been made, or a plan that has been submitted, all in accordance with this Law.
(b)A rehabilitation developer in a rehabilitation and renewal area to which an applicable plan applies, where an apartment owner or plot owner in that area has not agreed to enter into a rehabilitation transaction or an exit agreement with the developer even though the developer offered to do so, may file a claim with the court against that apartment owner or plot owner (in this section – the defendant).
(c)If the court finds that the need for rapid, efficient and optimal rehabilitation of the rehabilitation and renewal area by means of urban renewal justifies doing so, it may act in one or more of the following ways:
(1)order the defendant to enter into a rehabilitation transaction or to enter into an exit agreement;
(2)order the defendant to cancel a rehabilitation transaction concluded with a developer who is not the rehabilitation developer, provided that such cancellation is effected for the purpose of entering into a rehabilitation transaction or an exit agreement, including by way of granting a remedy under paragraph (1);
(3)appoint an advocate or an accountant, who is not an apartment owner or a plot owner in the rehabilitation and renewal area, who shall be authorised in accordance with the court's instructions to carry out on behalf of the defendant who has not entered into an agreement with the rehabilitation developer the acts referred to in paragraphs (1) and (2).
(d)In granting a remedy under subsection (c), the court shall have regard, inter alia, to the following:
(1)the size of the area that has suffered war damage and the impact on the surroundings;
(2)the number of apartment owners whose apartments have suffered war damage as a result of which it is not possible to reside in the apartment, and the number of apartment owners who have entered into a rehabilitation transaction or an exit agreement;
(3)the harm expected to be caused to the defendant by the granting of a remedy as referred to in subsection (c), and the possibility of reducing it;
(4)the rehabilitation developer's conduct in good faith in the course of the negotiations for entering into a rehabilitation transaction or an exit agreement, including the offer of a rehabilitation transaction to all apartment owners based on uniform consideration principles;
(5)the economic viability of the rehabilitation transaction or exit agreement; if an evacuation-construction valuer has determined that the transaction is economically viable, that determination shall constitute a presumption that it is viable as aforesaid, unless the contrary has been proved; if an evacuation-construction valuer has determined that the transaction will be economically viable subject to conditions set by the valuer, it shall be presumed to be viable as aforesaid upon the fulfilment of the conditions set by the valuer, unless the contrary has been proved;
(6)whether alternative housing was offered to the defendant apartment owner for the period of construction of the new building, and if the defendant apartment owner or a family member residing with the defendant is a person with a disability – whether the alternative housing offered includes adaptations, to the extent that such adaptations existed in the apartment in which the rights are being transferred or to the extent that they are required by the characteristics of the alternative housing;
(7)whether adequate securities were offered to the defendant for the performance of the rehabilitation transaction or the exit agreement, and if an evacuation-construction valuer has set conditions regarding economic viability – whether adequate guarantees were not provided for the fulfilment of the conditions;
(8)whether the apartment owner who resided in the apartment at the time of the occurrence of the war damage, or a family member who resided with the owner at that time, is a person with a disability to whom a consideration apartment including adaptations or a payment for the adaptations was not offered;
(9)whether the apartment owner who resided in the apartment at the time of the occurrence of the war damage is a person who at that time had reached, according to the registration in the population registry, the age of 70 (in this paragraph – an elderly person), and was not offered at least one of the alternatives set out below, at the developer's choice, in addition to the options set out in section 37:
(a)granting the elderly person the option to choose one of the following:
(1)moving to a retirement home as defined in the Evacuation-Construction Law, including with the addition of equalisation payments, of a value similar to the capitalised value of a consideration apartment, provided that such a move is made possible no later than the date of vacation of the apartment in which the rights are being transferred, as set in the rehabilitation transaction;
(2)purchase of an alternative apartment whose value is similar to the capitalised value of a consideration apartment to be delivered to the elderly person no later than the date of vacation of the apartment in which the rights are being transferred, as set in the rehabilitation transaction; the location of such an apartment shall be, as far as possible, in proximity to the elderly person's apartment – if the elderly person so requests;
(3)receipt of a sum of money of a capitalised value similar to that of a consideration apartment, for the purpose of purchasing an alternative apartment by the elderly person using all or most of that amount, no later than the date of vacation of the apartment in which the rights are being transferred, as set in the rehabilitation transaction;
(b)two apartments whose aggregate value is similar to the value of a consideration apartment;
(c)a consideration apartment whose area is smaller than the area of the consideration apartment that the elderly person was to receive as part of the rehabilitation transaction, plus equalisation payments, all of a value similar to the value of a consideration apartment;
(10)whether the apartment owner who resided in the apartment at the time of the occurrence of the war damage is one of those listed below and was not offered an alternative as referred to in paragraph (9)(a), in addition to the option of receiving a consideration apartment:
(a)an elderly person who at the time of the occurrence of the war damage had reached, according to the registration in the population registry, the age of 75;
(b)a terminally ill patient as defined in the Terminally Ill Patient Law, 5766-2005;
(c)a person who at the time of the occurrence of the war damage resided in the apartment and was entitled to a nursing care benefit under section 224(a)(5) or (6) of the National Insurance Law [Consolidated Version], 5755-1995;
(11)whether a rehabilitation transaction and an exit agreement, as the case may be, were offered to the defendant within the periods prescribed in this Law and in accordance with the provisions of this Law.
(e)Notwithstanding the provisions of subsection (d), if the court finds that the matters referred to in paragraphs (4) to (10) of that subsection are satisfied, it may set conditions subject only to the fulfilment of which it shall grant the remedy referred to in subsection (c).
(f)In respect of procedural rules in a claim under this section, the provisions of Chapter XII of the Civil Procedure Regulations, 5779-2018, shall apply, with the necessary modifications.
Claim for the Vacation of an Apartment in respect of which a Court has Approved the Performance of a Rehabilitation Transaction or an Exit Agreement§
49.
Notwithstanding any law, a claim for the vacation of an apartment in respect of which the court has approved the performance of a rehabilitation transaction or an exit agreement as referred to in section 48 shall be submitted to the same court that approved the transaction or agreement as aforesaid.
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