Detailed overview
Israel does not currently have a single horizontal AI Act equivalent to the EU AI Act. Its AI framework is based on a policy of responsible innovation, sector-specific regulation, soft regulatory tools, existing laws and alignment with international AI principles.
Sector-specific approach
Israel's AI policy was developed by the Ministry of Innovation, Science and Technology together with the Ministry of Justice. The policy recommends a sector-specific and incremental approach to AI regulation, rather than one central AI statute for all sectors.
The policy identifies major AI risks, including bias and discrimination, lack of transparency, lack of human oversight, privacy risks, vulnerability of AI systems, safety concerns, accountability issues and intellectual-property concerns. It supports flexible regulation, guidance, sandboxes and coordination between regulators.
Use-case-driven compliance
Under the Israeli model, AI compliance depends on the use case. AI used with personal data may be regulated under privacy law. AI used in healthcare, financial services, transportation, employment, education, consumer services or public administration may be reviewed under sector-specific law and regulator guidance.
Council of Europe AI Convention
Israel has also signed the Council of Europe AI Convention, which may influence future domestic AI governance through human-rights, democracy and rule-of-law safeguards.
Penalties
Israel does not currently have one AI-specific penalty table. Penalties depend on the underlying law breached, including privacy, consumer protection, financial regulation, healthcare regulation, employment law, product safety, cybersecurity or criminal law.
Practical requirements & details
Sourced from the AI Regulation and Ethics Policy (Ministry of Innovation, Science and Technology + Ministry of Justice, 2023), the Protection of Privacy Law 5741-1981 + 2024 amendments, and sectoral regulator guidance (BoI, ISA, MOH).
Israeli AI policy — sector-by-sector approach
- Recommends incremental, sector-specific regulation rather than one central AI statute.
- Encourages risk-based regulation, sandboxes and inter-regulator coordination.
Risk identification
- Bias and discrimination; lack of transparency; lack of human oversight; privacy risks; vulnerability of AI systems; safety; accountability; intellectual property.
Privacy law overlay
- Protection of Privacy Law + 2024 reforms (effective Aug 2025): mandatory DPIA, expanded individual rights, breach notification, stricter cross-border transfer rules.
- Privacy Protection Authority fines: up to ILS 3.2M + administrative measures.
Sector overlays
- Bank of Israel proper-conduct directive on technology risks applies to AI.
- ISA on AI in securities and asset management.
- MOH AI medical-device guidance.
- Equality in Employment Law, Equal Rights Law for AI-driven discrimination.
Council of Europe AI Convention
- Israel has signed; domestic implementation may add human-rights, democracy and rule-of-law safeguards.