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Recent developments and trends

Recent developments

Are there any notable recent developments or trends in the aviation sector in your jurisdiction?

The Aviation Law, which was enacted in 2011 after many years of drafting and discussion, sets a new and modern regulatory regime for aviation services in Israel.

The Open Skies Agreement signed between Israel and the European Union influenced Israel’s aviation sector by strengthening competition and prompting many new airlines to begin operation in Israel.

Israel’s aviation industry has many consumer aspects, mostly regarding providing services to passengers in accordance with consumer protection law and the new Air Services Law (which provides compensation for flight delay and cancellation).

Regulatory framework

Domestic law

What is the primary domestic legislation governing the aviation industry in your jurisdiction?

The Aviation Law 2011 is the primary legislation for aviation industry in Israel. Aviation law is relatively new and is therefore modern and up to date, providing the legal framework for aviation operation in Israel.

International law

What international aviation agreements has your jurisdiction concluded?

Israel has concluded many international aviation agreements, including the EU-Israel Open Skies Agreement, the US-Israel Open Skies Agreement and various bilateral agreements. The Montreal Convention is also part of Israeli law through the Air Transport Law.

Regulatory authorities

Which government bodies regulate the aviation industry and what is the extent of their powers?

The Ministry of Transportation:

  • regulates the aviation industry; and
  • has the authority to enact new laws and regulations.

The Israel Civil Aviation Authority:

  • sets and maintains procedures and regulations for domestic and international aviation;
  • grants licences and permits in accordance with the Aviation Law (including for aircraft, air personnel, airports and aircraft manufacturers);
  • supervises aviation operations regarding transport safety and efficiency; and
  • implements international agreements and treaties.

The Israel Airport Authority:

  • holds, manages and operates Israel’s airports; and
  • acts as necessary to maintain the security of the airports, passengers and aircraft within airport premises.

Air carrier operations

Operating authorisation

What procedural and documentary requirements must air carriers meet in order to operate in your jurisdiction?

Israeli carriers must have an operational licence and a commercial licence.

Ownership and control

Do any nationality or other requirements or restrictions apply to ownership or control of air carriers operating in your jurisdiction?

For Israeli carriers, restrictions apply to:

  • individuals who are permanent residents in Israel or Israeli citizens whose major place of business is Israel; and
  • entities which are established in Israel with no major place of business outside Israel, the control of which is in the hands of Israeli citizens or permanent residents.

Financial requirements

What financial thresholds must air carriers meet to obtain operating authorisation?

As a condition for obtaining operating authorisation, the applicant must prove that he or she has (as owner or lessor of a long-term lease) at least two aircraft and that are capable of operation, subject to Civil Aviation Authority manager discretion.

Insurance coverage

What is the required level of insurance coverage for air carrier operations?

There is a draft of new regulations which set the minimum requirements for insurance coverage for air carrier operations. The regulations are not yet in force. For personal damages for passengers, the relevant provisions of the Montreal Convention apply.

Safety requirements

What safety requirements apply to air carrier operations, including with regard to professional and technical certifications?

The air carrier must:

  • prove its professional and technical ability;
  • appoint relevant officers (eg, a safety officer);
  • provide an operational and technical manual for the approval of the Civil Aviation Authority and other authority requirements; and
  • provide an authority-approved safety management system.

Environmental obligations

What environmental obligations apply to air carrier operations?

There are obligations in place in respect of the hours of operation of Ben Gurion Airport, as well as night restrictions on take-offs and noise restrictions.

Air traffic control

How are air traffic control services regulated in your jurisdiction?

The Airport Authority Law regulates air traffic control services.

Routes

Do any licensing requirements apply to specific routes?

Yes, subject to the provisions of the bilateral aviation agreements between Israel and the relevant country, there may be limitations regarding the number of air carriers, seats or frequencies, and licensing requirements may be relevant.

Are any public service obligations in place with respect to remote destinations?

Not applicable.

Charter services

Do any special provisions apply to charter services?

A request for approval of charter flights should be filed with the Civil Aviation Authority.

Taxes

What taxes apply to the provision of air carrier services?

Several fees apply, mostly for the use of airport facilities. Air carriers are entitled to set certain surcharges on ticket fares.

Consumer protection and liability

Airfares

Are airfares regulated in your jurisdiction?

Airfares are regulated only for domestic operation. The maximum fare is set out in the regulations.

According to the Consumer Protection Law, all prices (including airfares) in Israel should be published as the total price (including all charges, taxes and levies).

Passenger protection

What rules and liabilities are air carriers subject to in respect of:

(a) Flight delays and cancellations?

The Air Services Law offers assistance, reimbursement and compensation for flight delays and cancellations to and from Israel. The law is based on EU Resolution 261/2004, with a few adaptations made specifically for Israel. The law provides passengers with remedies for delays of more than two hours, flight cancellations and denied boarding.

(b) Oversold flights?

The Air Services Law offers remedies for overbooking.

(c) Denied boarding?

The Air Services Law offers remedies for denied boarding.

(d) Access for disabled passengers?

There are regulations regarding equal rights for the disabled on public transport, which set aircarrier requirements for the provision of assistance to disabled passengers at the airport and during the flight.

(e) Lost, damaged or destroyed luggage?

The Air Transport Law adopts the Montreal Convention. The convention governs an airline’s obligations regarding its passengers in case of lost, damaged or destroyed luggage, as well as bodily damage or injury.

(f) Retention and protection of passenger data?

The Protection of Privacy Law includes rules for the safety of personal data, which is also relevant in respect of passenger data.

Cargo

What rules and liabilities apply to the air carriage of cargo?

The Air Transport Law adopts the Montreal Convention and provides obligations in respect of cargo operation (mostly for loss, damage or delay in cargo delivery).

Marketing and advertising

Do any special rules apply to the marketing and advertising of aviation services?

The Consumer Protection Law applies for aviation services, mainly regarding:

  • advertising issues (eg, the obligation to advertise at full price); and
  • obligations in respect of passenger rights in case of reservation cancellations (ie, the ability to cancel within 14 days of a reservation with a minimum charge of 5% of the reservation value and no more than NIS100 per passenger).

 

Complaints handling

Do any special rules apply to consumer complaints handling in the aviation industry?

The Air Services Law states the rules and remedies for consumer complaints regarding delay, flight cancellations and denied boarding. It also states the necessity for punitive damages where the airline does not comply with the law. Consumer complaints may also be handled by the Consumer Protection and Fair Trade Authority acting as part of the Ministry of Economics.

Aircraft

Aircraft register

What are the requirements for entry in the domestic aircraft register?

The procedure for domestic aircraft registration is in accordance with aviation regulations (eg, aircraft registration and marking). It includes the submission of:

  • an application;
  • the original bill of sale; and
  • proof of payment of fees.

Mortgages and encumbrances

Is there a domestic register for aircraft mortgages, encumbrances and other interests? If so, what are the requirements and legal effects of registration?

The procedure for domestic registration for aircraft mortgages, encumbrances and other interests is in accordance with aviation regulations (eg, aircraft registration and marking). Proof of registration is required and any interest is registered with the aircraft registrar.

Detention

What rules and procedures govern the detention of aircraft?

The Airport Authority has the right to detain any asset on its premises (including aircraft) in case there is debt for charges, fees or payment. The provisions of detention also apply subject to court supervision.

Safety and maintenance

What rules and procedures govern aircraft safety and maintenance?

The air carrier must prove its maintenance and technical ability and provide an operational and technical manual for the approval of the Civil Aviation Authority. The carrier must also have an authority-approved safety management system.

Specific regulations apply to maintenance facilities, which also require specific licences.

Drones

What is the state of regulation on unmanned aerial vehicles (drones) in your jurisdiction?

The Aviation Law includes several provisions regarding the operation of drones, including licensing obligations (mostly for commercial operations). In addition, there are specific regulations for the operation of drones.

Accidents

Investigation

How are air accidents investigated in your jurisdiction?

Accidents are investigated by the chief investigator of the Ministry of Transportation. The chief investigator has the right to visit any relevant place and act in any manner to preserve the site of the accident for the completion of the investigation. The chief investigator will issue a report and recommendations.

Liability

What liability regime governs death, injury and loss arising from air accidents?

The Air Transport Law adopts the Montreal Convention. The convention has a two-year limitation period.

Regulatory notification

What are the reporting requirements for air accidents?

According to the Aviation Regulations (which cover aircraft accident and incident investigation), the notification of an accident involving aircraft will be delivered to the chief investigator of the Ministry of Transportation. The regulations set out:

  • procedures in case of accident;
  • the chief investigator’s authority;
  • the possibility of the Civil Aviation Authority manager to suspend the licence of a person involved in an accident until the investigation is finalised for reasons of flight safety; and
  • other relevant provisions.

Airports

Ownership

What rules govern the ownership of airports (both public and private)?

The Airport Authority Law governs the ownership of airports in Israel, which are owned by the authority on behalf of the state.

Operation

What is the authorisation procedure for the operation of airports?

All matters in respect of the operation of airports are subject to the discretion of the Airport Authority, which owns, manages and governs Israel’s airports.

What ongoing operating requirements apply (including obligations relating to safety, security and facilities maintenance)?

There are various operating requirements within the airports, including for the unloading of cargo, safety and security matters, check-in operation and transportation.

Airport charges

What airport charges apply and how are they regulated?

The Airport Authority Law states several charges that apply for the operation of Israeli airports, including:

  • landing fees;
  • parking fees;
  • portage fees;
  • air traffic control fees; and
  • outgoing passenger fees.

Access

What regulations govern access to airports?

The Airport Authority Law governs all matters concerning operation and access to airports in Israel.

Slot allocation

What regime governs the allocation of airport slots (including slot transfer, revocation and disputes)?

In principle, the Airport Authority is in charge of airport slots, which are allocated fairly and in consideration of historical rights. An authority decision can be brought to the Supreme Court of Justice should any person or entity wish to oppose it.

Ground handling

How are ground handling services regulated?

The Airport Authority has published a bid for the operation of ground-handling services at Ben Gurion Airport. The winning bidders will provide ground-handling services for the duration of the agreement.

Competition issues

Governing regime

Do any sector-specific competition regulatory/legal provisions apply to the aviation industry in your jurisdiction?

Yes, the following legal provisions apply:

  • the Antitrust Rules for Agreements Between Air Carriers – these are the general rules which set out what kind of arrangements are exempt from the prior approval of the antitrust commissioner and will not be regarded as restrictive arrangements; and
  • the Antitrust Rules For Arrangements Regarding Marketing Flights Between Air Carriers in Destinations Governed by Open Skies Agreements.

Code sharing and joint ventures

What (if any) competition concerns arise in relation to code sharing and air carrier joint ventures?

In general, code sharing agreements and air carrier joint ventures are subject to the prior approval of the antitrust commissioner, although some agreements may not require the commissioner’s approval and may be approved after self-assessment of the parties and notification to the commissioner.

State aid

What rules govern state aid in the aviation industry? Do any exemptions apply?

The Israel-EU Open Skies Agreement states the principle of fair competition without subsidy from governments.

The Israeli government’s payment of most security expenses incurred by Israeli airlines for special security measures as a result of the government’s instructions does not constitute unfair state aid.

Notable cases

Have there been any notable recent cases or rulings involving competition in the aviation industry?

No.

Dispute resolution

Disputes

What aviation-related disputes typically arise in your jurisdiction and how are they usually resolved?

Aviation disputes mostly involve consumer issues and passenger claims, which are usually resolved by the courts.