חוק סליקת שיקים ושיקים ללא כיסוי (תיקוני חקיקה), התשפ"א-2021Law on the Settlement of Checks and Uncovered Checks (legislative amendments), 2021 · automatic translation · suggest a correction

Official summary of the law (Knesset)

The Check Clearing and Dishonored Checks Law (Legislative Amendments), 2021 (hereinafter - the Law), was approved in second and third reading on 8 February 2021. In 2016, the Knesset enacted the Electronic Clearing of Checks Law, 2016, which establishes that checks may be deposited and cleared through electronic clearing. Until the enactment of that law, checks were cleared through manual inter-bank clearing. Additionally, in 2018, as part of the Economic Plan Law (Legislative Amendments for Implementing the Economic Policy for the 2019 Budget Year), 2018, the Banking Law (Customer Service) was amended to legislate the bank mobility reform ("mobility at the click of a button"), aimed at enabling the transfer of a private customer's financial activity from a transferring bank to a receiving bank at the click of a button, while imposing obligations on banks to carry out the transfer online, conveniently, reliably, securely and without charging the customer for the account transfer process. The reform was set to take effect on 22 March 2020, but was postponed, by order, until 22 September 2021. The Law contains supplementary provisions in several laws for implementing the mobility reform with respect to transferring a check account between banks and the manner of clearing them, addressing several scenarios: first, a bank transfer of a customer who drew the check; second, a bank transfer of a customer who is paying the check; third, the application of provisions concerning restricted accounts. One amendment is to the Electronic Clearing of Checks Law, 2016. As part of the amendment, a mechanism is established allowing a customer to switch banks even if checks were drawn from their account at the original bank, so that they will be paid from their account at the receiving bank. Similarly, the receiving bank will be able to present a check for payment even if it was deposited or transferred for collection at the original bank. Additionally, the name of this law was changed to the Check Clearing Law, 2016, since, with the enactment of the amendment, the law will address check clearing in general and not only electronic clearing. Furthermore, the Supervisor of Banks was authorized to impose a financial sanction on a bank that violates the provisions of this law. A second amendment is to the Dishonored Checks Law, 1981 (hereinafter - the Dishonored Checks Law), which establishes arrangements for restricting an account after checks have been dishonored in it according to the number specified in the law. As part of the amendment to the law, provisions were established clarifying how the law will apply to a transferred account, including how previously dishonored checks in the account at the original bank will be taken into account for the purpose of restricting the account. Additionally, in accordance with the arrangement currently established in the Dishonored Checks Law, the Bank of Israel publishes the numbers of restricted accounts, noting the name of the bank where the account is held and the date the restriction ends. In order to enable the Bank of Israel to present updated and reliable information also regarding a transferred account, it is established that the receiving bank is obligated to provide information about the account to the Bank of Israel. In cases where a transferred account was restricted at the original bank and will not be restricted at the receiving bank - the Bank of Israel will not publish the transferred account as a restricted account. Conversely, if the account at the original bank was not restricted, but is expected to be restricted at the receiving bank - the Bank of Israel will publish the details of the restricted account noting the date the restriction ends. It is clarified that if the account was restricted at the original bank and is also restricted at the receiving bank - the Bank of Israel will publish the account details. A third amendment is to the Banking Law (Customer Service), 1981. The Law establishes that, due to the need to address the routing of financial activity that continues to arrive at the original bank even after the account has been transferred from it (payments or credits), the authority of the Governor of the Bank of Israel will be expanded to establish, by rules, types of financial activity for which the receiving bank and the transferring bank will carry out the actions required to transfer the customer's financial activity between them, even after the date of the account transfer, such that the Governor may establish different periods for different types of financial activity. The commencement date of the Law is the date on which the normative framework of the reform comes into effect, on 22 September 2021. The provision authorizing the Supervisor of Banks to impose a financial sanction under the Electronic Clearing of Checks Law, 2016, will come into effect on 1 May 2021, and the amendment to the name of this law will come into effect upon publication of the Law.

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