The court interprets the term "surplus" in order to test the profit in the distribution of dividend

August 2019

Want to distribute a dividend? This next legal update is exactly for you! In a precedential decision delivered in July, the Tel-Aviv District Court (Economics dept.) has interpreted key terms of the Companies Act which relate to distribution of dividends and ordered that a dividend can be distributed only from the “net profit” of the company, and not from other capital reserves. For further reading about this decision, read the full legal update here.

More Articles in Legal Update