Contributor: S. Horowitz & Co.
Author: Eyal Doron, Hugh Kowarsky, Tammy Riesenberg
1. Is there specific legislation in Israel ruling the using of documents (such as Leases, Security Agreements, Mortgages, Lease Assignments, Novation and IDERAs) executed with the use of digital platforms or any electronic signatures by the local Aviation Authority?
The Israeli Aviation Law, 2011 (the “Aviation Law”) and its regulations do not refer to the use by the Civil Aviation Authority of Israel (the “CAAI”) of documents executed with the use of digital platforms or electronic signatures. In practice, an application for registering a pledge on an aircraft must be delivered in hard copy to the Aircraft Registrar at the CAAI (original documents or certified copies must be delivered). However, there are applications that can be delivered to the Aircraft Registrar by filing a digital form, such as an application for the allocation of aircraft nationality and registration marks, and there are also applications that can be submitted to the CAAI by e-mail, such as an application to receive a certificate of airworthiness.
2. If your answer to (1) is yes, is there any specific requirement for the validity of such signatures, such as completion with a specific cryptographic platform developed by any local institute of technology?
3. Does the Aviation Authority in Israel use an electronic register for Aircraft Documents or Aircraft Lease Documents (including Leases, Security Agreements, Mortgages, Lease Assignments, Novation and IDERAs)?
The CAAI does not use an electronic register for Aircraft Documents or Aircraft Lease Documents. Pursuant to Section 59(b) of the Aviation Law and Regulation 4(a) of the Aviation Regulations (Registration and Marking of Aircraft), 1973, the aircraft register at the CAAI (the “Aircraft Register”) includes details regarding the aircraft, such as details of its owner, pledges and foreclosures imposed on the aircraft, nationality and registration marks and manufacturer.
4. If your reply to question 3 is yes, is it possible to upload electronic files for registration, such as Leases, Security Agreements, Mortgages, Lease Assignments, Novation and IDERAs with the Aviation Authority in Israel?
5. Do the courts of Israel consider valid and enforceable documents executed by the use of some type of digital signature or certification even if not registered (or registrable) with the local Aviation Authority?
If the pledgor is a company pursuant to the Israeli Companies Law 5759-1999, an agreement providing for the creation of a pledge over an aircraft may be valid and enforceable by virtue of its registration at the Israeli Registrar of Companies. Registration at the Israeli Registrar of Companies may be performed online if the documents filed bear electronic signatures. Such electronic signatures may be effected only by the use of a specific system known as the national identification system or of a card containing an electronic chip for the electronic identification of the cardholder used for the purpose of electronic signature on documents. However, please note that such a pledge will usually also be filed with the Aircraft Registrar. Also, please note that certain lenders in favour of which such a pledge may be registered, such as banks, do not accept electronic signatures and documents must be signed and delivered in hard copies.
6. Is it possible to upload lawsuits, pleadings, and procedural documents electronically in Israel?
Yes. In accordance with the Instructions relating to Filing a Digital Document to the Courts and the Labour Tribunals regarding the Civil Procedure Regulations, 5769-2018 (hereinafter “the Instructions” and “the Civil Procedure Regulations”) and according to Section 165 (b) of the Civil Procedure Regulations, it is permissible to file electronic documents to the courts through the judiciary website (“Net Hamishpat” – Law Site). However, according to Section 162 of the Civil Procedure Regulations, there are four exceptions to this permit:
(1) the first document to be filed in the case or a statement of claim will be served on the addressee (not being a court) by mail or by messenger unless the recipient had agreed otherwise in writing;
(2) if the sender is not the court and the addressee is a party not represented by a lawyer, unless the addressee has agreed to it in writing;
(3) the document, by its nature, is not one which can be served by electronic means;
(4) the document is the first document to be filed in a case being conducted before the Supreme Court.
7. Do the courts of Israel accept procedural documents executed digitally? Is there any specific certification required? Does Israel make any distinction between official digital signatures and private digital signatures?
The courts do accept documents executed digitally. Until September 5, 2022, the filing to the courts of documents executed digitally was possible on condition that the document and its attachments were signed by the filing party using “an approved digital signature” as defined in the Electronic Signature Law, 5761-2001 (“the Electronic Signature Law” or “the Law”). In accordance with the Notice to the Media issued by the Court Management on September 6, 2022, as of that day, advocates and parties not represented by advocates are able to file with “Net Hamishpat” (the court website) claims and other documents in proceedings conducted in the courts and the Labour Tribunals without digital signature of the document.
According to the Electronic Signature Law, when a law requires a signature of a person on a document, this requirement may be met with respect to a document that is an “electronic message” by “a certified electronic signature.”
The Electronic Signature Law does not use the terms “official electronic signature” or “private electronic signature” appearing in the above question but defines three types of signatures:“electronic signature” – “a signature which is electronic information or an electronic signal applied or connected to an electronic message”; “secured electronic signature” – an electronic signature which is unique to the owner of the means of signature; enables the identification, prima facie, of the owner of the means; is created by means of a signature subject to the exclusive control of the owner of means of signature; and enables the identification of a change made in the electronic message after the date of the signature. “certified electronic signature” – a “secured electronic signature that a certifying authority has issued a certified electronic certificate, regarding the means of verifying the signature, that identifies it.
An electronic message signed by a secured electronic signature is admissible in any legal proceeding and will constitute evidence prima facie: (1) that the electronic message was not altered after the time of its signature; (2) that the electronic message was signed by means of signature recognized by means of verifying the signature found in the electronic certificate attached to the electronic message, as far as it was attached; (3) with respect to an electronic message signed by a certified electronic signature – also as to that the electronic message was signed by the owner of the means of signature.
8. Are there any formal requirements for the validity of documents executed by digital signatures? Ex.: Does the consent of the parties to digital signatures have to be expressly referred to in the agreement?
As indicated above, according to Section 3 of the Electronic Signature Law, an electronic message signed by a “secured electronic signature” will be admissible in any legal proceeding and will constitute, inter alia, prima facie evidence that – (1) the electronic message was not changed after the date of its signature; (2) the electronic message was signed by means of signature recognized by means of signature verification; and (3) with respect to an electronic message signed by a certified electronic signature (as defined in the Electronic Signature Law) – also that the electronic message was signed by a person who was issued the means of signature.
A “secured electronic signature” is an electronic signature that meets all the conditions laid down in Section 1 of the Electronic Signature Law, i.e., it is exclusive to the owner of the means of signature; it enables the prima facie identification of the owner of the means of signature; it was produced by means of signature under the sole control of the owner of the means of control; and enables identification of a change made in the electronic message after the date of signature.
“means of signature” means “exclusive software, object or information needed for the production of a secured electronic signature’,
“electronic message” – information that is created, sent, received or saved by electronic or optical means when it is seen, read, heard or retrieved by said means.
We are not aware of a requirement (by law or case law) that the consent of the parties to the use of digital signatures be expressly referred to in the agreement.
9. Can foreign entities not located in Israel execute Lease Agreements or any Finance Documents with digital signatures to be filed for registration with the Aviation Authority in Israel? Are there any other formalities required?
Lease Agreements and Financial Documents are not submitted for registration (for example, in order to register a pledge on an aircraft in the Aircraft Register, it is not required to submit a pledge agreement). As aforesaid, in order to register a pledge on an aircraft, original documents or certified copies must be delivered physically to the Aircraft Registrar. The documents can be submitted by the parties thereto and/or someone on their behalf so that the presence of the parties is not required. As far as the signature of the documents is concerned, we are not aware of formal instructions or guidelines in this regard, but the expectation of the authorities (Based on an inquiry) is that the documents would be signed physically (rather than electronically).
In order to operate a leased aircraft, the lessee must provide the CAAI director with a copy of the Lease Agreement, which includes the details specified in Regulation 48 of the Air Navigation Regulations (Operation of Aircraft and Flight Rules) 1981, within 72 hours of its execution, and a copy of such Lease Agreement must be kept on the aircraft. Further, the lessee or the registered owner of the aircraft, if the lessee is not an Israeli citizen or permanent resident of Israel, must notify the CAAI director or someone on his behalf at least 48 hours before the first departure of the aircraft under the lease agreement, such notice to include the name of the airport from which the aircraft is to depart, the date of the departure and the registration mark of the aircraft.
10. Does the Aviation Industry in Israel usually use digital tools such as blockchain technology for the purpose of control of Aircraft Documents in substitution of printed paper Aircraft Documents?
Based on our research, the Aviation Industry in Israel uses printed paper documents for control of Aircraft Documents. For example, an aircraft registration certificate and a certificate of airworthiness are printed paper documents. In some cases, the legislation allows documents to be managed electronically by those who are required to do so pursuant under law. For example, according to Regulation 45(a) of the Air Navigation Regulations (Maintenance Approved Organizations), 2013 (the “MAO Regulations”), the holder of a license to operate an approved maintenance organization may maintain a file, list or documentation that must be maintained according to the MAO Regulations using a computerized system, provided that the system is secured against changes by unauthorized persons, and is backed up by a computerized file that will be updated no later than twenty-four (24) hours after any change made. On the other hand, according to Regulation 45(b) of the MAO Regulations, if the director of the CAAI or someone on his behalf asks to review the aforementioned file, list or documentation, the license holder is required to provide him with a printout of the file, list, or documentation requested.
11. Are there any Notary or Apostille requirements in Israel? If so, do they apply to electronically executed documents, and how does this affect the possibility of electronic execution and delivery of aviation documents?
a. Has Israel implemented the e-Apostille program?
Yes. Notarization of a wide range of documents is required in Israel, including documents produced in Israel for use in Israel, as well as documents produced outside Israel for use in Israel. Examples of documents of the latter type are an affidavit intended for submission in proceedings before an Israeli court, a deed of sale for registration in the relevant local Land Registry of a transaction in real property located in Israel and in some cases, a power of attorney. Such a document also requires verification by apostille attached to it or legalization by the Israeli consul in the country in which the document is signed.
Further to Israel’s Electronic Signature Law (see response to question 7 above) and Israel’s participation in actions taken presumably with respect to the modernization of the Hague Apostille Convention, to which Israel is a party, the Israeli Ministry of Justice has established a system enabling notarization by electronic signature and electronic application of the apostille in Israel, including electronic delivery of the documents. The ESL empowers the Registrar appointed under that Law to recognize an entity approving electronic signatures in a foreign country abroad as an approving entity under the Law, thus enabling reciprocal recognition of electronic signatures between Israel and the foreign country in question. The ESL also provides that the admissibility of a signature shall not be refused merely because it is an electronic signature.
As indicated in the response to question 1 above, the Israeli aviation authorities are willing, in some cases, to accept electronic delivery of documents (instead of hard copies thereof) and hence it is possible, in the light of the provisions of the Electronic Signature Law, that in cases where a document submitted to the authorities requires notarization and the apostille (in general, that is not required), electronic signatures and delivery of the documents will be (and perhaps may have to be) accepted by the authorities.