preface

BDO Israel
DOING BUSINESS IN ISRAEL
♦ Magneton - This program is similar to the Magnet; however, it
encourages cooperation between a single academic institution and an
industrial plant. The available grant is up to NIS 3.4 million.
♦ Nofar - This program is designed to support applied academic
research in biotechnology, and to promote the transfer of technology
to industry. Grants are available up to 90% of the approved research
budget, but not exceeding NIS 420,000.
♦ Long term R&D programs for companies with intensive R&D
investments2 in the know-how industry - R&D of generic
technologies used to develop, plan, or produce innovative products,
and in the pharmaceutics industry - ethical R&D in preliminary
stages.
The grant is offered, inter alia, to a company that has neither standing
repayments to the Chief Scientist’s Office nor a royalties agreement,
and provided the total grant requested does not exceed 20% of its
annual R&D budget.
Grants of up to 50% of total approved R&D costs are available, and
the total sum of long-term R&D grants, coupled with Magnet grants,
must not exceed NIS65 million. Royalty payments are not required.
Expenses are approved on an itemized basis, while salaries and wages
are limited, particularly those of interested parties. A set of rules
determines the nature and amount of each approved expense.
Unapproved expenses are not entitled to grants.
If the R&D program is successful, royalties are payable to the Chief
Scientist’s Office. These usually range between 3% and 5% of the sale
of products developed using government aid, and are paid till full
repayment of the grant, linked to the United States dollar.
If production is relocated overseas, the Chief Scientist’s prior consent is
required, while 120%-300% of the grant must be repaid respectively,
according to the production percentage being relocated. Additionally,
the amount of royalties will increase.
(2) Companies employing more than 200 persons in R&D in Israel, or companies with
R&D budgets exceeding US$ 20 million together with sales from production in Israel
exceeding US$ 100 million in the preceding year.
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