Israeli Parliament Advances Law Requiring Businesses to Provide Call Recordings to Consumers

The Israeli Knesset's Economic Committee has approved a significant amendment to the Consumer Protection Law that mandates businesses to record certain sales calls, retain these recordings, and provide them to consumers upon request. This legislative move aims to protect consumers from misleading marketing calls and reduce fraud in telephone transactions, which have increasingly been a source of complaints and scams.

The new law applies to transactions valued at 750 shekels or more in sectors with frequent consumer disputes or fraud cases, including loan brokerage, credit rating services, telecommunications, gas services, ongoing medical services, maintenance and repairs, tax refund eligibility checks, and medical rights assessments. It also covers transactions initiated by proactive marketing calls from businesses.

Under the amendment, businesses must inform consumers at the start of each call that the conversation is being recorded and that the consumer can request a copy. Recordings must be kept for two years if a transaction is completed, or six months if not. Consumers can demand the recording within 10 business days, with the first request free of charge. Failure to provide the recording will result in the consumer's version of the call being accepted as accurate in any dispute.

Economic Committee Chairman MK David Bitan successfully pushed to extend the law's coverage to banks, insurance companies, insurance agents, and pension advisors when they initiate marketing calls. Penalties for non-compliance include fines of approximately 22,500 shekels for corporations, 7,000 shekels for sole proprietors, and up to 50,000 shekels per violation for banks. Insurance entities will be subject to their existing enforcement mechanisms.

The amendment is expected to take effect eight months after its publication in the official gazette, with a possible four-month extension to allow businesses to prepare. The Consumer Protection Authority emphasized that the law aims to provide consumers, especially vulnerable groups like the elderly, with a powerful tool against fraud, potentially transforming how telephone sales are conducted in Israel.