Arbitration Confidentiality in Israel: Is Your Dispute Private?

A commercial dispute went to Israeli arbitration. The respondent then made a press release about it. The claimant's lawyer called to ask how that was possible — wasn't arbitration supposed to be confidential? The honest answer is: not automatically. Unlike the rules of several major international arbitral institutions, Israeli arbitration under the Arbitration Law 1968 contains no blanket confidentiality obligation. Parties who assume their dispute is private because it is in arbitration are frequently wrong.

But "in theory" is doing real work in that sentence. Many parties enter Israeli arbitration assuming it is entirely confidential, only to discover later that the law does not automatically impose that obligation. Whether your dispute stays behind closed doors depends largely on how you set up your arbitration agreement from the start. This guide explains exactly what Israeli law provides, where the gaps are, and how to protect yourself.

1. The Distinction Between Private and Confidential

These two concepts are frequently confused, but they operate differently in practice.

Privacy means that third parties cannot attend the proceedings. Arbitration hearings in Israel are conducted behind closed doors — there is no public gallery, no journalists, no competing companies watching. This aspect of privacy is well-established and widely accepted across both domestic and international Israeli arbitration practice.

Confidentiality is a much broader obligation. It covers:

• The existence of the dispute itself (the fact that arbitration is happening at all)
• Documents and evidence exchanged during the proceedings
• Witness statements and expert reports
• The arbitral award and its reasoning
• Any settlement reached during the process

A party may be prohibited from attending a hearing (privacy) while still being free to tell a journalist that the arbitration is taking place and who the parties are (no confidentiality). For a foreign investor or business with reputational concerns, that distinction matters enormously.

Israeli law has traditionally been clearer on the privacy aspect than on confidentiality. The gap becomes particularly significant when an arbitral award needs to be enforced through the courts — a step that, by its nature, moves the dispute from the private sphere into the public record.

2. What the Arbitration Law 1968 Says

Domestic arbitration in Israel is governed by the Arbitration Law 1968 (*Chok HaBorrerut, 5728-1968*). This statute sets out the framework for appointing arbitrators, conducting proceedings, challenging and enforcing awards, and the relationship between the arbitration tribunal and the courts.

Notably, the 1968 law contains no explicit confidentiality obligation. It does not require arbitrators to keep proceedings confidential, and it does not prohibit parties from disclosing documents or the award to third parties. The private nature of hearings is implied by the structure of the process — arbitration is a contractual dispute resolution mechanism, not a public proceeding — but this is a practical default, not a statutory guarantee.

Israeli courts have, over the years, recognized an implied duty of confidentiality as part of the arbitration agreement, drawing on general principles of good faith (*tom lev*) that run through Israeli contract law under the Contracts (General Part) Law 1973. But relying on implied obligations carries obvious risks: what is "implied" is inherently uncertain, and parties can disagree about its scope, particularly in cross-border disputes where the foreign party is unfamiliar with Israeli legal norms.

The practical consequence: under the 1968 regime, if you want genuine confidentiality, you must create it contractually.

3. The International Commercial Arbitration Law 2024

A significant development for foreign parties is Israel's enactment of the International Commercial Arbitration Law 2024 (*Chok HaBorrerut HaMiskhari HaBeinleumi, 5784-2024*), which came into force in February 2024. This law, based on the UNCITRAL Model Law on International Commercial Arbitration with its 2006 amendments, applies to international commercial disputes where at least one party has its place of business outside Israel, or where the subject matter of the dispute has significant connections abroad.

The ICA Law represents a substantial improvement over the 1968 framework in several respects relevant to confidentiality:

• Confidentiality of proceedings: The ICA Law expressly provides that hearings are not open to persons not involved in the proceedings — codifying the privacy norm that was previously only implied.
• Arbitrator confidentiality: Arbitrators appointed under the ICA Law are expected to maintain confidentiality as part of their professional obligations, a norm that is now better grounded in statute.
• Award disclosure: While the ICA Law does not impose an absolute ban on disclosing the award, it provides clearer grounds for parties to seek confidentiality orders from the arbitral tribunal.
• Court proceedings: When Israeli courts interact with ICA Law arbitrations — to appoint arbitrators, grant interim measures, or enforce awards — the legislative intent is to minimize public disclosure of the substance of the dispute wherever possible.

That said, even under the ICA Law, confidentiality is not fully automatic. The law creates a stronger foundation, but parties in international commercial arbitrations with Israeli elements should still use a well-drafted confidentiality clause and, where possible, choose institutional arbitration rules that impose confidentiality obligations expressly.

4. How to Strengthen Confidentiality in Your Arbitration Agreement

The most reliable way to protect confidentiality in Israeli arbitration is to address it directly in the arbitration clause itself, or in a separate confidentiality agreement signed before or at the start of the proceedings. Here is what a well-drafted confidentiality regime should cover:

What to Include in a Confidentiality Clause

• Scope of information covered: Define confidential information broadly — the existence of the dispute, all pleadings, evidence, witness statements, expert reports, the award, and any settlement terms.
• Who is bound: The parties, their legal representatives, the arbitrators, and any witnesses or experts — all should be expressly included.
• Duration: Specify how long confidentiality obligations last — typically for the duration of the proceedings plus a defined period afterward (commonly 3–5 years, or indefinitely for trade secrets).
• Permitted disclosures: Carve out narrow exceptions for disclosures required by law, court order, regulatory obligation, or necessary to enforce the award.
• Remedies: State that breach of confidentiality will give rise to injunctive relief and damages — this makes the obligation enforceable and deters casual disclosure.

Choosing Institutional Rules That Impose Confidentiality

Many foreign parties arbitrating with Israeli counterparts use institutional rules that include built-in confidentiality obligations. This is often the simplest solution, as it avoids the need to negotiate every detail of the confidentiality framework:

• The Israel Centre for Commercial Arbitration (*HaMerkaz HaIsraeli LeBorrerut Miskhari*, or ICCA) has its own procedural rules, which include confidentiality provisions applicable to arbitrators and parties.
• The ICC Rules (International Chamber of Commerce) impose confidentiality on arbitrators but leave party confidentiality to be agreed separately — so a supplemental clause is still advisable.
• The LCIA Rules (London Court of International Arbitration) include comprehensive confidentiality obligations on all participants, making them a strong choice for parties with privacy concerns.
• The UNCITRAL Rules, frequently used in ad hoc arbitration, do not impose default confidentiality, reinforcing the need for a contractual clause.

When drafting or reviewing a commercial contract with Israeli parties, examine which arbitration rules are referenced. If the clause is silent on confidentiality and uses UNCITRAL or similarly open-ended rules, consider adding a specific confidentiality rider.

5. When Confidentiality Can Be Overridden

Even with a robust confidentiality agreement, certain situations can require disclosure. Understanding these limits in advance helps parties plan accordingly:

Court Challenges to the Award

If either party seeks to challenge the arbitral award in the Israeli courts under Section 24 of the 1968 Arbitration Law (or the equivalent provisions of the ICA Law 2024), the award and relevant documents will be submitted to court as part of that application. Court files in Israel are generally accessible to the public, which means confidential information can enter the public record at this stage. Parties concerned about this should consider including a provision in their arbitration agreement asking the arbitral tribunal to redact commercially sensitive information from any award before it is submitted to court — or to prepare a separate public-facing summary.

Enforcement in Foreign Jurisdictions

If you win an Israeli arbitral award and need to enforce it against assets held outside Israel, you will typically need to file the award with a court in that jurisdiction. Many countries have their own rules about what becomes public at enforcement stage. This is a structural reality of international arbitration that no confidentiality clause can fully prevent — it is worth planning for it.

Regulatory and Legal Disclosure Obligations

Publicly listed companies in Israel are subject to disclosure obligations under securities law that may require them to report the existence of material disputes, including arbitrations. Similarly, foreign companies listed on overseas exchanges may face disclosure obligations under their local securities rules. A confidentiality clause cannot override a statutory disclosure requirement.

Insolvency Proceedings

If a party to the arbitration becomes insolvent and enters receivership or liquidation under Israeli insolvency law, the arbitration and any award may become part of the insolvent estate's affairs — which are administered through court proceedings open to creditors and, to some extent, the public.

Public Interest and Fraud

Israeli courts have discretion to lift confidentiality obligations where doing so is required in the public interest, or where confidentiality is being used to conceal fraud or other illegality. This is an exceptional situation, but it is a recognized limit on arbitration confidentiality in Israeli case law.

6. Arbitration vs. Israeli Court Proceedings: The Privacy Comparison

For a foreign party weighing whether to include an arbitration clause in an Israeli contract, the privacy advantage of arbitration over litigation is real — but it is not absolute. Here is a practical comparison:

The privacy advantage of arbitration is meaningful for commercial parties who want to keep sensitive business information — pricing, trade secrets, contractual terms with third parties — out of the public record. It is most reliable when: (a) both parties are sophisticated and bound by a well-drafted confidentiality clause; (b) neither party is publicly listed or subject to mandatory disclosure rules; and (c) the dispute is unlikely to require court enforcement in multiple jurisdictions.

For disputes involving real estate transactions, corporate acquisitions, or employment matters with Israeli parties, arbitration with a confidentiality clause is frequently the preferred structure precisely because Israeli District Court proceedings — while efficient by regional standards — are fully public.

A British pharmaceutical company came to me during a licensing arbitration with an Israeli generic manufacturer seated at the ICCA, in which the manufacturer had already disclosed the existence of the dispute and the claimed royalty shortfall of NIS 4.2 million in a press release. The arbitration agreement contained no confidentiality clause — the parties had used a standard template without adding one. Under the Arbitration Law 5728-1968, the Israeli courts confirmed there was no implied confidentiality obligation that could have prevented the disclosure. We could only limit future disclosures by obtaining a supplemental confidentiality undertaking from the manufacturer, which required three weeks of negotiation and a NIS 8,000 legal cost before any substantive hearing had taken place. A ten-line confidentiality clause in the original agreement would have prevented the disclosure entirely; the absence of one cost both parties disproportionately in reputation and fees.