Why This Powerful Israeli Agency Won't Disclose the Scale of the Palestinian Properties It Manages

The dominion of the Custodian of Absentee Properties over the Jerusalem property market has led Palestinians to 'fear to make deals on the east side,' but the body shows no signs of revealing the basic details of its inventory

Nir Hasson
Nir Hasson
Palestinian residents of Silwan outside Israel's Supreme Court prior to a hearing in Jerusalem, last month.
Palestinian residents of Silwan outside Israel's Supreme Court prior to a hearing in Jerusalem, last month.Credit: AP/Sebastian Scheiner
Nir Hasson
Nir Hasson

Israel's Custodian of Absentee Properties is a powerful agency that manages hundreds of properties in East Jerusalem and shapes the city's real estate market — but power does not always mean knowledge.

Despite its vast sway, a recent hearing on a freedom of information request reveals the Finance Ministry department doesn't know how many properties it controls; or that finding the information is too complicated; or that revealing this information may compromise the country’s foreign relations – depends on which answer you choose to believe.

With the backing of the magistrate’s court judge, who decided not to force the custodian to disclose the information, one of the most contentious bodies in Israel has the license to remain opaque.

The Custodian of Absentee Property has been operating under the Absentee Property Law of 1950, which transfers to the state any property whose owner stayed in an enemy country during the temporary “state of emergency” – which is in effect until this day, renewed perfunctorily on a biannual and bipartisan basis. Through the law, the state has seized all the property left behind by Palestinian refugees in 1948. In a controversial expansion, the law was applied to East Jerusalem as well, after it was de facto annexed to Israel in 1967. This means that any property on the east side of Jerusalem belonging to somebody living in the West Bank or an Arab country is supposed to automatically devolve to the Custodian — and herein lies the problem.

The fear of the Custodian is one of the most impeding factors in the real estate market in East Jerusalem, with a far-reaching impact on the economy and city planning. As many Palestinian families have a relative who lives or lived in an Arab country, almost every piece of property in the east side can be claimed to have an owner who is an absentee, and therefore the Custodian should receive their share of the asset. Among other things, it causes many to prefer purchasing and selling realty on the black market, without notifying authorities, or to turn to illegal construction in order to avoid requesting a building permit.

A family in East Jerusalem where the Absentee Property Law has been used to seize Palestinian homes, 2019.Credit: Olivier Fitoussi

“An unreasonable situation has developed where people fear to make deals on the east side,” says Att. Amir Adika Tal of Kadari, Shamir & Co. Law Offices, which has taken up the fight on the subject. “The resulting situation is that there is an enormous pool of houses and land that nobody is doing anything with, despite Jerusalem being desperate for land.” Even a massive land registration drive announced by the state some two and a half months ago was met with noncooperation, due to the same fear.

Against this backdrop, Ram Cohen, an attorney at Tal, Kadari, Shamir & Co. Law Offices and an urban planning student, decided to file a freedom of information request to establish how many properties are managed by the Custodian. The firm represented him in the petition, in an effort to uncover even a fraction of the goings-on at the Custodian’s office. Based on experience from a previously rejected petition, Cohen did not request the location of the properties or the identities of the owners, but only the number: How many properties are “assigned,” or supposed to be under the Custodian’s control, how many of these are managed by the Custodian in practice, and how many have been released to their owners or sold.

What ensued was a series of contradictory accounts. The Custodian first responded that the number of properties it owns cannot be given “due to the complexity of the requested information,” that there are no properties managed by it, and that it has no information on the scope of properties released or sold.

Demonstration in the Sheikh Jarrah neighborhood of Jerusalem against Israeli families who live in houses sold to Jews, March.Credit: Ohad Zwigenberg

Just before the hearing on the petition at the Jerusalem Magistrate’s Court last June, the Custodian suddenly recalled that they do manage a single property: The Seven Arches Hotel on Mt. Olives in Jerusalem. At that time the Custodian devised a new reason to turn down the request: Revealing the information would compromise Israel’s foreign relations, which is considered a legitimate reason for authorities to decline requests to reveal information on their activities.

Ronen Baruch, the Custodian of Absentee Property since 2005, gave a different answer. He testified to the court that his unit has a staff of just three, only two of whom are professional. “Even thought we’re in 2021, our office isn’t digitized, and the material isn’t scanned,” he said on the stand, explaining that from 1967 to this day, no comprehensive survey has been conducted of the Custodian’s properties in East Jerusalem. He said that every year there are some 40 requests to release properties back to their owners, but he doesn’t know how many were approved. In response to a question by Judge Einat Avman-Muller, Baruch explained that in order to extrapolate the information about the number of properties, he has to pore over paper files.

The hearing also had a surprise attendee: Jonathan Rosenzweig, head of the Palestinian department at the Foreign Ministry. Despite objection by Cohen and Adika, the judge granted the Custodian’s request and allowed Rosenzweig to be heard ex parte. After this, the judge decided to reject the freedom of information request: “I have been convinced that the disclosure of the requested information may jeopardize the state’s foreign relations,” she wrote in her ruling. She fully accepted the Custodian’s explanations. “I am satisfied that delivery of the information will cause an unreasonable allocation of resources… Which may disrupt and even paralyze the Custodian’s work,” she wrote, adding that Cohen must pay the Custodian’s legal expenses, a sum of 10,000 shekels.

“What harms the state’s foreign relations? Revealing the information, or the very existence of the law, over 70 years after the country’s founding?” Adika asks. Cohen and Adika have recently filed an appeal of the decision to the District Court. The appeal was joined by former Deputy State’s Prosecutor, Shuki Lamberger. “This law is very powerful in regard to the state’s authority over people’s private property,” says Lamberger. “There is public and economic importance in knowing how it conducts itself with this power, how many such properties there are, how many they release, how many they sell. This is a very unconventional law. The impression is that they’re either presenting a very imprecise picture, or that they’re not managing at all."

The Finance Ministry, in response to a series of questions about the Custodian’s operations: “The state will respond in the proper jurisdictions.” The Foreign Ministry declined to comment.

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