Is an arbitration clause that only one party can invoke enforceable in Israel?

Asymmetry is not, by itself, a defect under the Arbitration Law. What the Law requires is a written agreement to submit a dispute to arbitration, and a clause giving one party the choice is still such an agreement once that party makes the election. The practical consequence is one-directional: the party holding the option can ask the court to stay a claim filed against it, while the other party cannot compel arbitration at all and must sue in court unless the option-holder elects otherwise. A court asked to stay proceedings looks at whether a valid agreement exists, whether the applicant is ready to arbitrate, and whether the applicant moved promptly. Where the contract is a standard form, the analysis shifts to whether the clause is unduly disadvantageous and can be struck out or varied.

Foreign parties negotiating with an Israeli counterpart should treat a one-sided option as a drafting weakness rather than a win, because a clause that is later struck out leaves you litigating in a forum you never chose. Make the option mutual, name the institution, fix the seat and the language, and set out how the arbitrator is appointed. If you are on the receiving end of such a clause and want to challenge it, timing decides the case: an application to stay court proceedings has to be made before you plead to the substance of the claim, and a party that files a defense first is usually treated as having waived arbitration. Anchor the drafting in a clause that survives challenge instead of relying on leverage.

From the full guide: Drafting an Arbitration Clause for Israeli Contracts

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