Data-center law in Israel

Planning and Building Regulations (Environmental Impact Assessments), 5763-2003, reg. 2

Applies to both

Issued under sections 1 and 265 of the Planning and Building Law, 5725-1965, regulation 2 requires the proponent of a local plan, a partial district outline plan, or a partial national outline plan to submit an environmental impact statement to the competent planning institution where the plan concerns a power station, airport, port, marina, refinery, a site for treating or disposing of hazardous waste, or land reclamation from the sea or a lake, and requires the same for any plan the planning institution considers likely to cause a significant environmental effect, including a plan for an industrial zone in which pollution-generating activity is permitted, a high or extra-high voltage power line, or a center for producing, storing, or transporting polluting or hazardous materials.

The planning institution may not decide to deposit such a plan before the environmental-impact-assessment process set out in regulation 5 (draft guidelines, guidelines, the statement itself, an environmental opinion, and a hearing) has run its course. These regulations repealed and replaced the 1982 regulations of the same name (reg. 17).

Source: Full text of law

Clean Air Law, 5768-2008, Arts. 1, 17(a), 24, 63(a), 93(a), Third Schedule item 1.1

Effective 2011-01-01 · Applies to both

Article 17(a) of the Clean Air Law, 5768-2008, provides that a person shall not install, hold, operate, or use, and shall not permit another to do so, an "emission source requiring a permit" (defined at Art. 1 by reference to the Third Schedule) unless the person holds a valid emission permit and acts in accordance with its conditions.

The Third Schedule's Energy Industries category, item 1.1, sets the threshold for a combustion installation at a thermal capacity exceeding 50 megawatts, a category that reaches a data center's own on-site generation or combustion-based cooling plant if it crosses that threshold. Article 24 separately conditions the issuance of a building permit or a business license under the Business Licensing Law on the applicant having applied for, or been granted, the required emission permit. The Law entered into force on 25 Tevet 5771 (1 January 2011).

Source: Full text of law

Encouragement of Capital Investments Law, 5719-1959, ss. 1-4, 42-43, 51

Applies to private

The Encouragement of Capital Investments Law, 5719-1959, aims to attract capital to Israel and encourage investment of foreign and local capital (s. 1) and establishes the Investment Center to grant benefits, either generally or project by project (ss. 2, 5).

Section 51's definition of a qualifying "industrial enterprise" (an enterprise in Israel whose main tax-year activity is "productive activity") expressly includes within "productive activity" the production of computer software products and development and industrial research and development for a foreign resident approved by the Director of the Industrial Research and Development Administration, so a data center or software operation can qualify on the same footing as a manufacturing plant.

An approved enterprise may claim accelerated depreciation on machines, equipment, and buildings used for its purposes (ss. 42-43), and the Law's Schedule sets an investment-grant rate of 20% in Development Area A and 10% in Development Area B for an approved enterprise that is an industrial enterprise, an equipment-leasing enterprise, or an industrial building.

A benefited industrial enterprise in Development Area A can instead claim a tax exemption if its minimum entitling investment is not less than NIS 900 million, or NIS 600 million in an entitling area.

Source: Full text of law