Another confidant of former prime minister Ehud Olmert was arrested yesterday on suspicion of bribing officials in what has come to be known as the Holyland affair, police said.

Jerusalem businessman Avigdor Kelner, 67, is believed to have paid hundreds of thousands of shekels in bribes to a number of officials, some of them in Jerusalem City Hall and in the Israel Lands Administration.

Kelner owns stocks in the Holyland residential complex and the Hazera company. Some of the officials Kelner is suspected to have bribed sat on the municipal Construction and Planning Committee.

Police said yesterday that in exchange for the bribes, processes and permits were sped up, fees were reduced, and considerable benefits were offered to the entrepreneurs of the Holyland project, saving them millions of shekels.

Kelner is also believed to have used companies he owned or managed to pay bribes to benefit Hazera, which had leasing rights to land by the Hiriya waste disposal site, by obtaining retroactive renewal of land leases and altering classification of land owned by the company. He is expected to remain in custody for six more days.

Kelner's attorney Eitan Maoz said his client denied all allegation, and said there was a "powerful motivating force with considerable interests" behind the affair.

The Petah Tikva District court rejected yesterday appeals by four other Holyland suspects, Uri Messer, Hillel Charney, Uri Sheetrit and Eliyahu Hasson, against the extension of their remand.

The Tel Aviv District Court agreed yesterday to pause Olmert's trial for a month due to the new investigation, but denied requests by the attorneys for Olmert and Shula Zaken to postpone the trial until the prosecution concludes the matter.

The court also agreed to the prosecution's request to change the order of the hearings, and the trial will reconvene in May to hear witnesses on the Rishon Tours double billing affair.

Jerusalem District Attorney Eli Abarbanel said yesterday in court the new developments may result in amendments to the former prime minister's indictment, but would not specify what these indictments might be.

Earlier this week, Abarbanel asked the court to change the order of the hearings. Witnesses for the Investment Center affair were scheduled to appear first before the court, and Abarbanel said he feared the same witnesses might be involved in the new allegations currently being investigated.

"Considering the new constraints of a police investigation, as detailed by the representative of the prosecution, we find no alternative but to relent to the prosecution's demand not to hear the remaining prosecution witnesses on the charges at hand," the judges wrote.

The former prime minister is traveling in Europe, and is scheduled to appear at the Holocaust Remembrance Day ceremony in Auschwitz next week, before returning to Israel.

"As of this moment, no one with the law enforcement authorities had asked Mr. Olmert to shorten his stay abroad and change his plans," Olmert's media adviser, Amir Dan, said yesterday.

Dan said he hoped the police would not arrest his client, and said that "we cannot imagine the police putting on a show like that just for the show."

Olmert is scheduled to visit Madrid over the weekend, and the Spanish government had granted him a special diplomatic visa to ensure he will not be arrested on any accusations related to Operation Cast Lead.

The former prime minister will be in Spain to watch a game between Real Madrid and Barcelona on Saturday night, and although this is a private visit, the Israeli Foreign Ministry had decided to request immunity from prosecution for Olmert.

A government source told Haaretz similar diplomatic visas were recently issued for Defense Minister Ehud Barak and Industry, Trade and Labor Minister Benjamin Ben-Eliezer.