News

January 2017

The financial newspaper "The Marker" published an article referring to the possible merger of the municipalities of Bat-Yam and Tel Aviv-Yaffo. The Minister of Interior Mr. Arie Dery, has been conducting final discussions before reaching a decision with respect to the possible merger of the Municipality of Bat-Yam with the Municipality of Tel Aviv-Yaffo and accordingly he has recently met with the mayors of both cities in order to receive their reference to this suggestion. This suggestion comes due to the recommendations of an investigation committee established in order to examine the merger, according to which the suggested merger between the two municipalities should be consumated within a relatively short schedule and by 2018 the residents of both cities should elect a common mayor and city council. The described meetings were held following the receipt of references by the municipalities of Rishon Lezion and Holon who together with Tel Aviv supported the idea of the suggested merger, in contrast to the Municipality of Bat Yam who was extremely opposed to such merger. The municipality of Tel Aviv noted in this regard that although it supports the idea of the suggested merger between the two cities, it is not prepared to provide Bat Yam with any funds prior to the consummation of the merger as there is no justification, so argued, that the Municipality of Tel Aviv or its residents will cover the deficit of Bat Yam. In this regard, it was noted that the three municipalities are currently conducting joint legal proceedings, through the representation of Adv. Ofer Bar-On a senior partner of our firm, demanding to appoint an accountant on behalf of the court to the Municipality of Bat Yam based on arguments of irresponsible financial conduct of Bat Yam which lead to their material deficit. The Municipality of Bat Yam attacked the recommendations of the committee and argued that "the committee was not granted the authority to nullify the city of Bat Yam, and its purpose was only to provide its recommendations to the Minister whether it is suggested to establish a new city comprising of Bat Yam and Tel Aviv. Any suggestion of merger must be accompanied by operative suggestions which will ensure equal, balanced and effective standing to both authorities".

December 2016

The financial newspaper "The Marker" recently published an article written by Adv. Ron Tzin, a senior partner of our firm, referring to the dramatic judgment issued by the Supreme Court according to which, the customary practice which has been common throughout recent decades and according to which local planning and zoning committees demand to receive letters of indemnification from private entrepreneurs with respect to claims filed according to section 197 to the planning and zoning laws as a condition for the promotion of a plan, is illegal as such demands are made without any authority to do so. According to Adv. Tzin, the abovementioned judgment, denying the authority of the local committees to demand letters of indemnification from private entrepreneurs, creates material problems for such committees due to the fact that without such indemnities, they are in fact paralyzed as they will not dare to authorize any plan which may expose them to financial burdens. Therefore and in light of the material interests involved in this matter, it can be expected, according to Adv. Tzin, that to the extent that the judgment will not be overruled in an additional hearing, the matter will be brought before the legislator who will be required to discuss and set clear rules and regulations in this regard.

November 2016

The administrative court of the central district recently ordered to return the general plan applicaple to Rishon Lezion to the District Committee for Planning and Zoning for objections, due to a petition filed by "Shupersal" represented by Adv. Ron Tzin and Sivan Rozenblat of our firm, arguing that the general plan does not include reference to affordable housing, as required. Shupersal argued within the petition that the suggested applicable general plan must include reference to the issue of affordable housing and that the committee's decision not to discuss such issue in such a wide scope general plan is extremely irreasonable. Although the Court finaly resolved that the decision taken by the District Committee not to allow Shupersal to initiate affordable housing plans with respect to its land was reasonable, Adv. Tzin stated that he is hopeful that due to the acceptance of most of the arguments raised within the petition, Shupersal's request will now be seriously considered.

September 17

The Regional Council of Emek Lod, together with the Local Committee for Planning and Zoning of Emek Lod and Moshav Nir Zvi filed a petition to the Supreme Court, in its capacity as the High Court of Justice, against the National Committee for Planning and Zoning and its respective committees as well as the Government of Israel and the Lod Municipality, demanding to dismiss a row of decisions reached by them for purposes of expanding the suburban composition of the cities Ramle-Lod, on the expense of the Regional Council and Moshav Nir Tzvi. It was argued within the petition, filed by Adv. Yuval Gal-On, Dan Or and Mordechai Gedanski of our firm, that the National Committee does not have the authority to examine all aspects pertaining to the expansion of Lod. This matter, so argued, should be examined within a procedure for determination of boundaries, as being conducted these days by professional teams which specialize in such field. It was further argued that the decisions reached with regard to the suburban composition of Ramle-Lod are extremely unreasonable as planning teams appointed by the very same National Committee which reached such decisions are currently engaged in the planning of a new overall plan which will apply to the city of Lod and in such plan it was determined that there is no justification to expand the jurisdiction of the city Lod beyond the boundaries which currently exist. As to the expropriation of lands owned by Moshav Nir Tzvi it was argued that diminution of additional land of the Moshav will harm the existence of agriculture in the Moshav and will in fact transform Nir Tzvi into a suburban residential neighborhood with no material justification.

September 17

The popular financial newspaper "The Marker" published an article written by Adv. Gal Snir, Head of Environmental Regulation in our firm, in which he indicates of the difficulties in collection of Landfill Levies from local authorities and factories which elect to bury waste rather than recycle. According to Adv. Gal, the difficulties arise due to the fact that currently, the monies of the Levies are not directed towards actions which were intended to be promoted by the Cleaning Fund (in which the monies are accumulated) and principally, assistance in the establishment of new recycling facilities.

May 2016

The municipalities of Tel Aviv, Holon and Rishon Lezion have recently submitted a petition, via advocates Ofer Bar-On, Motti Gadanski and Natali Ben David of our firm, to the Supreme Court, demanding that the Ministry of Interior appoints an escorting accountant on its behalf to the Municipality of Bat Yam. Within the petition, the municipalities, which the option of them being merged with the Municipality of Bat Yam is being assessed, argue that the Minister of Interior has many powers as to the rehabilitation and financial stabling of a municipality such as Bat Yam, which faces financial difficulties and ongoing accumulating debts, that without the municipality needing to request to receive income from neighboring municipalities (such as the petitioners). One of such powers vested with the Minister of Interior is the power to appoint an escorting accountant on its behalf. In the case of Bat Yam, so argued by the petitioners, all the required circumstances for the appointment of such accountant apply. To the extent that the Supreme Court will accept the petitioners' demand and decide to order that an accountant be appointed as requested, the Municipality of Bat Yam will be conducted under a strict plan for its financial rehabilitation. Furthermore, every expense which the municipality or its mayor will request to perform, will be carefully examined by the escorting accountant.

May 2016

The real estate column of the financial newspaper "The Marker", recently published a study performed by advocate Ron Tzin, a senior partner of our firm, who examined the degree of influence which objections submitted by private and public entities with regard to plans deliberated in district committees for planning and construction have. According to the study, which received wide publishing, amongst all the objections submitted by public entities, approximately 50% were accepted whereas amongst all the objections submitted by private entities, only 30% of the arguments were accepted. According to adv. Tzin, who examined 310 plans (out of approximately 4,500 which were submitted during 2015) "even though statistically, the numbers are relatively impressive, taking into account the entrepreneurs and environmental organizations, the figures receive different proportions. When one reads and examines the substance of the decisions issued, it reveals a grim picture according to which the objectors are no more than a control group of the plan. The contribution of the control group to the plan is a type of proofreading but it cannot lead to material changes in the plan. The cases in which a plan that the district committee decided to deposit according to the recommendation of a district planner, is declined or materially changed due to an objection submitted, are rare, if at all existent."

April 2016

Advocate Yuval Gal-On, a senior partner of our firm, participated in a convention of mayors organized by the rating agency D&B, hosted by Mr. Hagay Golan, editor of the financial newspaper "Globes", during which the participants deliberated various topics mayors find to be distressing these days, amongst others, the topic of urban renewal. Adv. Gal-On argued within the debate that the demand by the municipalities towards the government should be openings for employees and engineers as the main problem these days is that the municipalities do not handle the burden. Adv. Gal-On advised that the municipalities address the Supreme Court in order for the government to start acknowledging them.

April 2016

The District Court in Tel Aviv, ordered the Israeli Railway Company to cancel a decision reached by its tender committee concerning the obtaining of measurement services for projects throughout Israel. The company, "M.T.B. Measurements and photgrametria", who won the tender published by the Railway Company in 2013, along with several other companies, addressed the court, via advocates Amir Witkon and Yaron Silver of our firm, after the Railway Company decided not to extend the contract with the company, in contrast to the other companies who were all granted with respective extensions to their contracts, all even though the Railway Company admitted that the services received by the company as well as the prices it offered were the best. As mentioned above, the court ordered the Railway Company to cancel its tender committee's decision and ordered it to pay the company's legal expenses.

February 2016

The financial newspaper "Globes" published an article regarding a building in the city of Kiryat Uno, built on land which is intended for public use and which is supposed to serve for the building of student dorms on it and which the municipality feared may be used by the entrepreneur, de facto, for the building of private residential units. The Municipality decided to prevent this unwanted situation and with the assistance of advocates Yuval Gal-On and Nitzan Zimran of our firm who represented the municipality in this matter, the entrepreneurs of the building signed a letter of commitment according to which they will manage the project and undertake that all the residents who will reside in the units to be built on the land will be students. In order to ensure so, the agreement also includes penalties and a financial guarantee deposited by the entrepreneurs. Adv. Gal-On noted in this regard that considering the fact that there is currently no sufficient budget for hundreds of inspectors, all the municipalities have left in order to ensure that private hands who posses buildings intended for public use will make use of these buildings for such purposes, is to create contractual mechanisms which intend to create contractual obligations by means of financial sanctions between the managing company and the municipality, between the managing company and the residents and between the owners of the units and their renters.

February 2016

Adv. Michal Halperin was recently appointed as the new Commissioner of the Israeli Antitrust Authority. In light of this occasion, the financial newspaper "The Marker" published an article specifying the anticipated challenges the new commissioner will be facing. Adv. Tzahi Yagur, head of the Antitrust department of our firm, was interviewed for this article. Adv. Yagur mentioned that the commissioner will be required to complete legislation regarding the easement of parallel importing and the equalization of the status of exclusive importers to that of monopolies as well as the reform of inspection over monopolies. According to Adv. Yagur, the reform of mergers is an opportunity to dilute unnecessary regulation procedures and to facilitate mergers which do not harm the competition while maintaining the Authority's authority to intervene in retrospect in problematic mergers. Above all, Adv. Yagur estimates that the new Commissioner will be required to restore the standing of the Israeli Antitrust Authority before the public which was recently damaged due to the natural gas affair and the criticism asserted by the State Comptroller

February 2016

The financial daily newspaper "Calcalist" published an article regarding a judgment recently issued by the Supreme Court of Israel regarding changes in the calculation methods of municipality taxes. According to the Union of Local Authorities, the majority of local municipalities will be required to perform a new measurement of all the assets in their domain up to the beginning of 2018. Adv. Ravit Baram-Mazor, head of the Municipal Taxation Department of our firm was interviewed for this article and noted that in her opinion the public sees the measurements as a nuisance and maltreatment and therefore the Mayors do not follow the instructions with regard to residential areas and when they do, they do so in a slow process. According to adv. Baram-Mazor, the cancellation of the "rounding" method which was customary eve of the judgment, will definitely benefit some of the public and harm others who will have to pay additional fees in order to balance their account, while the local municipality will gain mainly from the building additions in its territory, as there are many of such. Accordingly, so noted by adv Baram-Mazor, the sector which will pay the price for this change in measurement method will be the residential sector who will have to

February 2016

The daily financial newspaper "Globes" published an article regarding a judgment recently issued in a petition submitted by Moshav Tzofit against the local municipality of south Hasharon, represented by advocates Ron Tzin and Nitzan Zimran of our firm. The Moshav submitted the petition against the results of a tender according to which an anthroposophy school is intended to be built on the property of the Moshav, instead of a regional school which has been operating there for many years. The Moshav argued that the plans which apply on the land determine that the land should be used only for the benefit of the Moshav members. The court dismissed the arguments raised by the Moshav and accepted the arguments presented by the Municipality, according to which the right interpretation of the relevant plans lead to the conclusion that the land is not limited to the use of the members of the Moshav alone, but to the general public. According to Adv, Tzin, this is an important judgment regarding the relationship between the local municipalities and the committees of settlements, as it determines that the public use of land should be managed by the municipalities for the benefit of a wide range of beneficiaries rather than for a small amount of members of the specific settlement in which the public asset is located.

January 2016

The Daily newspaper "Yediot Ahronot" published an article regarding a petition filed by a city planner, represented by Advocates Yuval Gal-on and Tomer Gur of our firm, against the decision reached by the planning institutions and against the Western Wall Legacy Foundation and the Israel Antiquities Authority, who gave their approval to plans which call for a massive scope of building in the western area of the Western Wall Plaza. As so argued within the petition by Adv. Gal-on and Gur, these building plans intend to materially reduce the territory of the Western Wall Plaza and therefore should not be approved.

January 2016

The financial newspaper "Globes" published a widespread article regarding a survey recently published, according to which the majority of the population is not familiar with the activities of the Israeli Antitrust Authority. Adv. Tzahi Yagur, head of the Antitrust Department of our firm, who was interviewed for this article stated that the survey shows that the Antitrust Authority's activities have not reached the Israeli citizens. According to Adv. Yagur, it is not enough to take actions, it is important that the citizens know that you have taken such actions. According to the results of the survey, the Antitrust Authority have not yet realized this important statement. Adv. Yagur notes that the Israeli Antitrust Authority should learn from its equivalent in the US, The Fair Trade Authority, which on a regular basis accompanies its activities with public relations activities in order for the American consumer to be aware and acknowledge its activities. The idea, according to Adv, Yagur, is not only to improve its public relations, but mainly to help to increase the awareness of competition matters amongst the population.

January 2016

On December 15th 2015, the Hungarian government discussed a proposed bill regarding the reduction of VAT from prices of new residential apartments from 27% (the current rate) to 5% onky. The deduction of VAT rates is meant, according to the bill, to apply only with regard to new residential apartments located in buildings and which size does not exceed 150 sqm and with regard to the sale of new houses which size does not exceed 300sqm. However, the deducted VAT rate shall not apply to vacant lands. If adopted by the Hungarian Parliament, the law shall come into effect as of January 1st 2016 and remain as a temporary provision for a period of four years, until the end of 2019. The provisions of the law shall apply only with regard to sale agreements to be signed after the law enters into effect. The Hungarian Minister of Economy expects that despite the reduction of VAT rate, the Hungarian treasure will not suffer any damage resulting from the deduction of income from taxes due to this step. It may be presumed that the dramatic change in VAT rates will encourage developers, local and foreign as one, to consider the development of residential projects. It is further expected in Hungary that the deduction in VAT rates on its own will provide for the renewal of growth in residential construction, to the increase of sales of between 3,000-5,000 extra units per year and to the deduction in housing prices and increase in employment in the field of construction. It should be noted that the bill was brought before the Hungarian government after a vast declining in the volume of construction, after in 2015 the number of units which were sold dropped to only 8,300 units. In comparison, in the previous decade (in 2004 for example) the volume of new apartments stood on approximately 43,000 units per year.

January 2016

The state of Israel grants land owners a significant benefit in the form of deduction in appreciation taxes paid by them in order to encourage them to sell assets owned by them and in that regard, to increase the volume of land sales intended for construction as part of city building plans. As part of the general attempts to reduce housing prices, within an amendment to the Israeli Taxation Law which came into effect during the beginning of 2016, a relief in the rates of appreciation tax will be given to a private persons, a family company or a partnership who will decide to sell their land on which there is an approved plan allowing for the construction of 8 and above residential units. The amendment shall apply also with regard to combination agreements. According to the amendment, a reduction of the maximum possible appreciation tax of approximately 40% (calculated according to the day of purchase or the day of receiving the sold land) will be given to those who purchased their land between 1961-2001. Note that this benefit is currently set as a temporary provision which shall expire in 2018 and in that regard the legislator has indicated to land owners that they should hurry up in order to enjoy such benefit. It may be noted that a similar benefit was given during 2011 which, according to details provided by the government, lead to approximately 70 transactions and to the construction of over 1,400 residential units. It can be expected that the present offer will accelerate the process of further more transactions as it includes even better beneficial parameters and refers also to a wide range of land intended for construction, where the deduction of taxes, due to the scope of land sold, is even greater.