Ban on the Import of Goods Produced with Forced Labor, Updates to Defense Export Controls, the Drone Legislative Memorandum, and the Encryption Reform at the Ministry of Economy and Industry
3 August 2026
Over the past week, several legislative and regulatory updates relevant to international trade, exports, and regulatory compliance were published. We invite you to review the updates below, assess their potential implications for your operations, and if the topics are relevant to you – we would be pleased to receive your comments and incorporate them as part of our professional input to the relevant government authorities.
Publication of a Draft Import and Export Order (Ban on the Import of Goods Produced with Forced Labor), 2026
On July 28, 2026, the Ministry of Economy and Industry published a draft Import and Export Order (Ban on the Import of Goods Produced with Forced Labor), 2026.
The proposed order seeks to create a mechanism that would enable restricting or prohibiting the import into Israel of goods produced, in whole or in part, through forced labor, in line with a developing regulatory trend in the U.S., the European Union, and other countries. At this stage, there remains significant uncertainty regarding the scope of the order’s application, as the annex to the order – intended to include entities, sectors, goods, or geographic areas – has not yet been published. In addition, the objection and appeal mechanisms, the criteria for exercising the authorities, and the manner in which the arrangement will be implemented in practice have not yet been clarified.
If the order is adopted as proposed, it may disrupt global supply chains due to a reduced range of import alternatives for raw materials, expand compliance requirements applicable to importers, and thereby increase operating and procurement costs – which may ultimately be passed on to consumers.
Deadline for submission of public comments: August 4, 2026, at 8:00 PM.
*Please note that this is an especially short timeframe for submitting comments*
Publication of Draft Defense Export Control Regulations (Exemption from a Defense Marketing License), 2026
On July 28, 2026, the Ministry of Defense published draft Defense Export Control Regulations (Exemption from a Defense Marketing License),2026.
The draft regulations constitute an additional step in the spirit of change and reform in the field of defense export controls, as presented at the 16th annual conference of the Defense Export Controls Agency within the Ministry of Defense (DECA) in November 2025, and following the conclusions of the Shani Committee which outlined suggestions to the MOD to reduce regulatory requirements and timeframes related to DECA’s defense controls. The initiative aims to streamline control processes and reduce the regulatory burden on industry.
The key innovation in the draft is an expansion of the pathways for exemption from a defense marketing license, such that in certain circumstances an exemption may also apply to products classified at a level higher than Unclassified – an adjustment that could significantly facilitate companies’ international marketing activities in this sector.
Deadline for submission of public comments: August 11, 2026, at 4:00 PM.
Publication of a Legislative Memorandum: Powers to Address the Drone Threat (Temporary Order), 2026
On July 27, 2026, the Ministry of Justice published the legislative memorandum: Powers to Address the Drone Threat (Temporary Order), 2026.
The legislative memorandum seeks to establish a dedicated framework of authorities for addressing the growing threat posed by drones and unmanned aircraft, including granting security and enforcement bodies broad powers to locate, identify, and neutralize drone activity that may endanger national security, public safety, critical infrastructure, or operational activity. In parallel, it proposes the establishment of a national system to consolidate and make information on drone activity accessible among the authorized bodies, with the aim of improving real-time identification and threat-response capabilities. This is a legislative initiative intended to address the technological and operational challenges that have come into sharper focus in recent years, by creating a dedicated and updated legal framework.
Deadline for submission of public comments: August 17, 2026, at 11:00 AM.
Regulatory Update – Draft Guidelines for Broad Licenses – the Encryption Reform at the Ministry of Economy and Industry
Further to our ongoing dialogue and joint work with the Ministry of Economy and Industry, on July 27, 2026, the Manufacturers Association of Israel hosted a roundtable meeting for the industry.
During the meeting, an initial draft of guidelines was presented for obtaining broad licenses for the export of encryption and information-security items subject to controls under Category 5, Part 2 of the Wassenaar Arrangement, as part of a broader initiative to formalize the regulatory control of encryption items at the Ministry of Economy and Industry.
Should this matter be relevant to your activities, we would be pleased to provide additional details and to assess together the potential implications for your company’s operations.
In light of the importance of these updates and the short timelines in some of the processes, we recommend reviewing their potential implications for your activities as soon as possible.
We are currently consolidating our comments and preparing to submit professional input to the relevant government authorities. If the above topics are relevant to your activities, we would appreciate receiving your comments or key points as soon as possible, and we will consider incorporating them into the submission being filed.
For further details, to schedule a call, or to submit comments – please contact us.
Raanan Sagi | Department of Defense, Regulation, and International Law | Herzog Fox & Neeman | [email protected]
- Regulatory Update – Draft Guidelines for Broad Licenses – the Encryption Reform at the Ministry of Economy and Industry
- Publication of a Legislative Memorandum: Powers to Address the Drone Threat (Temporary Order), 2026
Please contact: Ron Garame | Head of High-Tech and Business Development | Manufacturers Association of Israel | [email protected]
- Publication of Draft Defense Export Control Regulations (Exemption from a Defense Marketing License), 2026
Please contact: Eitan Mandel | Head of the Defense Industries Division | Manufacturers Association of Israel | [email protected]
