We are proud to announce that Epstein Rosenblum Maoz (ERM) has been awarded the Israel Firm of the Year at the Women in Business Law Awards EMEA.

Thank you, Women in Business Law Awards, for the recognition: “The firm impressed the judges by having a very strong representation of women at all levels in the firm, strong initiatives supporting and developing women talent from Diversity & Inclusion, to Career Development and mentoring, and an impressive pro bono practice. The firm also showcased strong attorneys across various practice specialisms.”

Receiving the award on behalf of ERM, for all our colleagues at the firm, were our partners, Chen Weiss and Lihi Elimelech-Bechor.

This recognition is for everyone at ERM who contributes to our vibrant and inclusive work environment.

We congratulate our client, Israir Airlines, on completing the acquisition of 75% of the shares in the Cypriot logistics company Bird Aviation.

The deal was overseen by Attorney Nimrod Rosenblum – Managing Partner and Head of the Mergers and Acquisitions Department, and Adv. Michal Gazit and Adv. Noam Zimmerman – Attornies in our Mergers and Acquisitions Department and High-Tech Department. Well done to everyone involved!

Link to the article: https://bit.ly/Israir-ERM

Proud of our Associate, Tal Ishay, Adv., for participating in the panel for the IX Energy and Economy Conference! Tal presented the topic of competition in the energy market.

ERM is proud to sponsor this convention once again, under the leadership of Amnon Epstein and Asaf Rimon.

Tal is an associate in ERM’s Energy & Infrastrucutre department and her talent was recognised by The Legal 500 and was named a Recommended Lawyer in the Infrastructure practice area.

We are very proud of our team!

Ron Abelski, Partner in our Corporate, M&A, and High-Tech departments and head of our German desk, in an interview for Relevant podcast regarding the launch of the IIA matching fund to encourage investments by institutional investors in the high-tech industry through Israeli venture capital funds.

Watch the full podcast interview here, in Hebrew: Tech Talk with Ron Abelski, ERM

 

Could the potential outcome of the recent ICC hearings in The Hague be a blow to the Israeli economy? Nimrod Rosenblum, Managing Partner and Head of the Corporate and M&A department at ERM in an interview for Globes magazine: “People believe in the Israeli economy. Today, one of my roles is to convince the investment committees that we have got a geopolitical problem, but we must make a separation.”

For the full article in Hebrew, click here: https://bit.ly/4bqlOgP

Transparency and standardisation in urban renewal agreements!

A new legislation in the sector of urban renewal has brought forth a request to embed frameworks as part of the guidelines for urban renewal agreements with municipalities.

A high level of caution and care must be taken when trying to balance freedom of contracts and stakeholders’ rights. Hence, the embedment of strict frameworks should not be without the careful consideration of the daily implications on those involved.

 

Partner, Yoav Zahavi, points out the necessary precisions by the legislator and the failures encountered in a new article for Globes magazine.

 

 

For the full article in Hebrew, click here: https://bit.ly/44zxI5b

 

 

The past year, which included wars at home and abroad, did not shine for the Israeli high-tech industry. At a time when foreign investments dropped by 60% and the first quarter of 2024 looks even more gloomy, it was precisely the Iranian attack that proved to everyone the importance of Israeli technology. When necessary, the State of Israel knows how to deploy Iron Dome batteries in order to protect its strategic assets and citizens, but what about the most important asset for the economy?

Ron Abeslki, Partner and Head of the German Desk, in an op-ed for the Calcalist Magazine’s TechTalk column.

 

For the full article, click here: https://bit.ly/oped-ron-abelski

On March 13, 2024, the EU AI Act (“the Act”), which regulates the use of artificial intelligence in the European Union, was passed in the European Parliament, after many discussions. The law is also expected to set the tone iView Postn relation to similar laws around the world, similar to the change brought about by the GDPR regulation upon its entry into force. It is very possible that legislators in other countries will take the EU’s regulatory approach and try to set similar standards. The joy is great, but what does it mean for an Israeli company? We will try to explain briefly. We emphasize that this publication does not exhaust the comprehensive legislation, but illuminates a number of important points in it.
1. Applicability of the law

Subject to exceptions and specific definitions, as a general rule the law will apply when:

• This is an Israeli company that operates an AI system in the European Union; or
• This is an Israeli company that provides an AI system to customers in the European Union; or
• The product of an Israeli company’s AI system will be used in the European Union; This is a definition that expands the application of the law for Israeli companies, and is intended to prevent a situation in which a foreign company escapes the application of the law; or
• The people affected by the AI systems are in the European Union.
The law also refers to providers, manufacturers, distributors, deployers and representatives and imposes various obligations on them.

The law refers to three categories:
• AI systems are prohibited from being used – for example, the use of which is intended for fraud, manipulation or deception, biometric cataloging based on sensitive information, social ranking or real-time remote biometric identification for the purpose of enforcement in public places.

• GPAI – General Purpose AI Models

a type of “general artificial intelligence”; General models used as part of AI systems that are able to: “completely perform a wider variety of different tasks regardless of the way the model is placed in the market, and which can be integrated into a variety of downstream systems or applications”. It is understood by the European legislator that these general models are the building blocks of the AI systems and their importance is great. There are specific guidelines for their development and use so that users can understand the functionality and algorithms that underlie the general models.

• High-Risk AI Systems, which will be discussed in detail below.

We emphasize that the legislation applies to both GPAI models and High-Risk AI Systems (no action should be taken in AI systems defined as prohibited from use).

2. Classification of AI systems and its actual effect on Israeli society

• The classification affects the amount and scope of the limitations and obligations associated with AI systems.
• The European legislator imposes many obligations on both types; Obligations such as increased transparency, clear explanation to users and shared responsibility for both GPAI and High-Risk AI Systems.
For example, the user who is “conversing” with the AI system must be informed of this, in such a way that the user understands that he is not conversing with a person. There are exceptions to this in cases where the matter is self-evident or in cases where the system is used for criminal prosecution.
Also, products of AI systems must be marked as such, including when it comes to GPAI products (for example, videos, images or text). In cases of deep fake, it must be marked that the content is artificially created or manipulated.
In addition, if the AI system is used for emotion recognition or biometric recognition – users must be informed of this.
• The law imposes additional duties on High-Risk AI Systems. These systems are subject to very extensive control, supervision, responsibility and transparency duties. As a rule, and with some exceptions, these are systems in these areas:
• Products subject to EU safety regulation;
• AI systems in critical areas, including:
Justice and Democracy Administration; law enforcement; immigration; biometric identification; education; essential services – including credit rating, emergency, certain insurances); employment; essential infrastructure.
It should be noted that there are exceptions and the definitions are complex.
The additional regulatory requirements for High-Risk AI Systems include:
• Data governance – strict adherence to instructions and compliance in training the system;
• compliance checks;
• Accuracy, system robustness and cyber security – Data Accuracy;
• Implementation and use of a risk management system – Risk Assessment;
• informing users about the nature and purpose of the system;
• Human supervision to reduce risks;
• Registration of systems in public prescriptions;
• reliable data use;
• Keeping records throughout the “life cycle” of the system;
• Transparency and clear instructions (which also refer to human supervision);
• Accurate technical documentation before using AI systems. After starting to use High-Risk AI Systems, regular monitoring is necessary, including:
• Implementing and documenting control measures on the systems, in accordance with a control plan prepared ahead of time as part of the necessary documentation. Relevant information on the use of AI systems must be collected, recorded and analyzed throughout;
• Rapid reporting of serious incidents to the relevant control authority when it comes to an AI system located in the European Union and cooperation with the authority, including through an internal investigation. Here too, the law imposes duties in relation to High-Risk AI Systems that also relate to the provider, distributor and deployer of the systems, with each having separate duties.
3. Fines
The fines that will be imposed for violating the law are expected to be high; Thus, prohibited use of AI systems may result in a fine of up to 35 million euros or another 7% of the global annual turnover (depending on the severity of the violation). for
High-Risk AI Systems, violating the law could result in a fine of 15 million euros or up to 3% of the global annual turnover (here, too, depending on the severity of the violation).

4. Entry into force of the law
The law will enter into force 20 days after its official publication, which is expected in May or June 2024. Most of the sections of the law will enter into force two years after the official publication; However, the Prohibited AI Systems rules will come into effect after 6 months, the GPAI rules will come into effect after 12 months and the High-Risk AI Systems rules will come into effect after 36 months.

5. If so, what should an Israeli company do at this stage?
• First, it is recommended that its Israeli company in connection with the subject assess its potential exposure to the law; For example, it is recommended to map the practice of AI, examine whether there is a potential impact on the European Union and whether there will be any use of the AI systems in use in the European Union, whether there are end customers there or any effect of the company’s AI systems or their products, etc.
• Second, it is recommended for an Israeli company to assess what the classification of the AI system associated with it is expected to be.
• Thirdly, it is recommended to seek professional advice in order to prepare for the entry into force of the law.

We will be happy to assist you in any matter related to artificial intelligence legislation, both in the European Union and in other jurisdictions.

The authors are lawyers Rotem Perelman-Parhi, partner and head of the technology, intellectual property and privacy protection department, and Einat Goldstein from her department.
For the avoidance of doubt, the foregoing serves as general information only and does not constitute legal advice or a substitute for legal advice.

Ron Abelski, Partner at ERM’s Corporate, M&A, High-tech, and Venture Capital practices, and Head of the German desk in a piece on the Israel-Germany bonds when it matters the most.

“In the initial weeks following October 7th, German investors, like their foreign counterparts, exercised caution regarding ongoing transactions in Israel.”

 

For the full article by The Global Legal Media in their April 2024 Edition, click here: https://bit.ly/442IHDX