Israel: Internet companies would be bound by Israeli jurisdiction

According to Attorney General opinion, foreign companies will be compelled to litigate in Israel courts

In what could be a very leading case, Israel’s AG stated that foreign companies should respond to Israeli courts, despite what’s their terms & conditions state. This legal opinion came in relation with a class action against Internet giant Facebook. The petitioner stated that Facebook monitored, read and misused user’s messages, providing no adequate notices. Also, they didn’t register their database as requested by law.

The District Court challenged Facebook’s foreign law and jurisdiction stipulation. They stated that the true aim is to impede Israeli consumers from exercising their legal rights. Also, District Court noted that Facebook provides their services to millions of Israelis with a Hebrew interface. Therefore, they declared that provision invalid.

As Facebook appealed ruling with the Israeli Supreme Court, the latter asked for the AG opinion on this matter. He concluded that Facebook’s provision do not bind Israeli users. Among others, he based his decision on:

  • Facebook’s intention to deter Israelis to exercise their rights via obligate them to litigate overseas.
  • The disadvantage that a FB user has against Facebook in relation with Ts&Cs’ acceptation.
  • The fact that foreign companies that aim to do business with Israelis can assess and forecast the legal risks and costs to litigate in Israel.
  • It’s easier for Facebook to access to Israel’s legal system than an Israeli to access US courts.

In conclusion, if Israel’s Supreme Court ratifies AG opinion, then most businesses that sells products & services for the Israel market, should review their business options. That’s because no matter what their Ts&Cs say, Israel’s law and justice system will prevail, even if the company does their businesses via Internet.

Sources

http://www.barlaw.co.il/client-updates/internet-companies-beware-of-mandatory-israeli-court-jurisdiction/

http://www.mondaq.com/x/585398/Data+Protection+Privacy/Israeli+Court+Privacy+Class+Action+Against+Facebook+may+Proceed

 

 

 

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