The Ministry of Industry and Trade has operated the Fund for Exposure
to Competing Imports since September 1, 1991. The Fund offers industrial
enterprises the means of preparing for competitive imports from Third
World countries (this includes all countries except the US, the EEC and
EFTA).

Assistance is given to companies that demonstrate the ability to improve
efficiency, thus enabling them to compete against imports without government
protection and in the context of diminishing tariff protection. Assistance is
also given for adapting production lines to export.

In order to receive assistance a company must convince the Fund that it will
incur significant damage from exposure to imports and that by implementing
their plan will provide them with a competitive advantage in the local or
export market and generate profitability under free trade conditions.

1.

Innovative technology -- including acquisition of knowledge.

2.

Changes in products and methods of production -- including investments
in equipment and net capital.

3.

Transition to production of new products -- including investment in
equipment and net capital.

4.

Improvements to packaging and marketing of products -- including use of
professional consultants.

5.

Changes in management and management methods by hiring experts from
outside of the company.

6.

Other measures for increasing the ability to compete with imports.

Assistance will only be given to industrial concerns that have not received
funding from other government sources including benefits granted by the
Law for the Encouragement of Capital Investments and assistance from the
Office of the Chief Scientist for the above-mentioned activities. Companies
are eligible for grants equal to 20% of their investments.

Grants are awarded for investments in new fixed assets including equipment,
adjustments and changes made to the production line and improvements in
methods of production, moving expenses, changes in existing products and
transition to new products as well as improvements in product design.

Grants will be awarded at the same rate for all regions and will not exceed
the Shekel equivalent of $500,000.

The amount of net worth required to receive assistance is conditional on
increasing issued share equity by at least 20% of the approved investment
plan.

Investments begun up to six months before the application will be recognized
for assistance.

The Ministry of Industry and Trade,

Agron St. 30, Jerusalem 94190

Tel: 02-6220711

Fax: 02-6220499