preface

98
INVESTMENT INCENTIVES AND TRADE ADVANTAGES
In case of exporting technology know-how for projects sponsored by the
Chief Scientist, or any other right derived from such technology for
enterprises outside Israel, payment will amount to a portion of the
remuneration for such know-how, set at a ratio of the total grant out of
the overall investments in the project, but no less than the amount of
grants provided to the company.
7.9.2. Heznek Program - The Government Seed Fund
The Ministry of Industry and Commerce established this program in
2002, to encourage investments in new start-up companies. The
program is based on the government matching an investment in a startup
company, proportional to the capital invested by other investors.
The definition of a start-up, for purposes of the program, is a company
that complies with the following criteria:
The company’s main activity is R&D.
♦ A company that received no funding beyond shareholders equity
(except funding obtained for feasibility studies).
♦ The company has obtained parallel investment from qualified
investors (see below), as defined by the program.
♦ The company was established no more than 6 months prior to the
application, or its total expenditure, by that time, has not exceeded
NIS1 million.
A qualified investor is an entity that meets all of the following criteria:
♦ A venture capital fund, or a corporation active in venture capital, or a
technological company investing in similar industries.
♦ An investor who possesses the ability and human resources to
oversee the management of a start-up company.
♦ An investor with sufficient available funds.
The program entitles the company to obtain a government investment of
up to 50% of the capital required under the approved work program,
where a qualified investor provides the other funding. The maximum
investment is NIS 5 million.
BDO Israel