Class-action Filed Against Israeli Supermarket Chain for Refusing Deliveries to Arab Towns

Residents in northern Israel sue Shufersal for 450-million shekels for not making online deliveries. Plaintiffs say they discovered phenomenon is nationwide.

The Shufersal branch in Carmiel, January 20, 2016.
Gil Eliyahu

A class-action suit for 450 million shekels ($113.4 million) was filed Wednesday with the District Court in Haifa against Shufersal, claiming the supermarket chain discriminates against Israeli Arabs by not allowing them to buy from its online store.

A resident of the village of Rameh together with a resident from the village of Fassuta, both located in northern Israel, filed the suit through their attorney, Jamela Hardal-Wakem, after they discovered that while they could enjoy the service, which includes buying products online and having them delivered to their home, their Jewish neighbors living in adjacent communities even more distant could take advantage of it. The plaintiff from Fassuta said in a statement he submitted to the court for the suit that he has been a member of Shufersal's club for years, and that he and his wife do a substantial amount of their shopping at the Shufersal branch in Maalot. According to him, he and his wife have made a number of attempts to buy from Shufersal's online store, but every time they were rejected "because Fassuta is not included in the chain's distribution areas."

"At first we thought naively that the company only delivers to big cities that have one of the branches," he stated. "But lately we learned that Shufersal supplies a delivery service almost everywhere in Israel, on condition that it is not an Arab community."

According to him, it emerged that the vehicles used for the chain's deliveries drive through Arab towns and villages, which do not receive service, on their way to Jewish communities, such as Harashim. Another instance in the lawsuit refers to Rameh, which is five kilometers from the Carmiel branch but does not receive the service.

The plaintiffs stated that this information led them to conduct a sample check on the Shufersal Online website. They discovered that almost every Arab community in the Carmiel area is excluded from the chain's distribution areas, while all the Jewish communities in the area are included.  A more thorough examination, according to the plaintiffs, found that 313 of 320 Jewish communities (98 percent) are included in the distribution areas, compared to just 11 of 113 Arab communities, or 10 percent.

The plaintiffs, together with experts in the field, examined in depth the chain's distribution area maps, the range of possible criteria that could have guided Shufersal in setting the distribution areas, such as distance from the branch, size of the community or type of community. They assert there was no economic or marketing criterion that could explain the distribution, save for the ethnic character of the community.

They stressed that the communities in which the plaintiffs live are included in the same areas that are marked on the maps of the anti-trust commissioner as areas in which Shufersal has a market share of over 30 percent, and in some places over 50 percent. Based on the anti-trust commissioner's map from November 2014, Shufersal has the widest distribution in Israel among all supermarket chains, operating at least 283 branches.

"This is not only callous discrimination based on national affiliation but also illegal discrimination," Hardal-Wakem, their attorney, said. "It is important that this suit be handled as a class-action suit so we can rectify this injustice and force the company to compensate the entire Arab public that has suffered discrimination. It is inconceivable that the big companies benefit from the Arab public's buying power while discriminating against it so callously and outrageously."

Shufersal commented: "Shufersal provides service to the entire population of Israel irrespective of religion, race or sex. We have yet to receive the lawsuit, and when it is received we will respond through legal proceedings."