Israel Nixes Haredi 'Cartel's' Bid for Property in Northern Town

In victory for secular activists, lands agency declares 12 applicants a cartel.

In a decision that marks a major victory for secular activists fighting over the future of a new city in the making, the Israel Lands Administration tender committee on Thursday disqualified 12 bids by Haredi associations seeking to purchase lots in the northern town of Harish, on the grounds that they were acting as a cartel.

At the same time, the committee awarded lots to a long list of other companies and associations, including an Arab association; a group promoting affordable housing; Bemuna, a company specializing in housing for the religious community; and an environmentally-oriented group, Harish Hayeruka ("Green Harish" ). The latter is the one that asked the tender committee to disqualify the Haredi associations' bids.

Members of Harish Hayeruka told TheMarker that thanks to the disqualification decision, Harish was now assured of becoming a mixed city rather than a Haredi one.

The ILA was selling lots for the construction of 4,634 housing units. Shortly after it issued the tender three months ago, Harish Hayeruka, which represents 650 families seeking to buy lots in the town, asked the ILA to disqualify bids by 12 Haredi associations. Harish Hayeruka charged that these 12 bidders essentially constituted a cartel because they were all united under one umbrella organization, the United Haredi Housing Committee, and appeared to have coordinated their bids for the lots.

Such cartel-like activity, it argued, would violate the Tenders Law, the Antitrust Law and the specific provisions of the Harish tender.

The United Haredi Housing Committee is a company co-owned by several prominent Haredi politicians and businessmen. One is Meir Porush, a former housing minister and MK with United Torah Judaism. In those capacities, he promoted the idea of Harish as a Haredi city. The company's other owners include Jerusalem Deputy Mayor Yosef Deutsch; Raphael Pinchasi, a former Shas MK and currently secretary-general of the party's Council of Torah Sages; former Bnei Brak Mayor Mordechai Karelitz; and Amir Crisapel, a close associate of Shas' spiritual leader Rabbi Ovadia Yosef. Some of these men, among them Porush and Deutsch, were present at meetings on the planning of Harish.

Advertisements aimed at the Haredi community indicate that the United Haredi Housing Committee was set up to prevent competition among the various Haredi housing associations, as this would drive up prices. These ads offered supporting evidence for Harish Hayeruka's claim that the 12 associations had coordinated their bids.

To evaluate this claim, the ILA sought legal advice from both the Justice Ministry and the Antitrust Authority. The latter was asked its opinion on issues such as whether nonprofit associations could constitute a cartel, whether their coordination was liable to cause a market failure, and what would constitute legal proof that the associations had indeed been helped by the United Haredi Housing Committee. After evaluating the evidence, the Antitrust Authority concluded that Harish Hayeruka's claims were justified and disqualified all 12 groups' bids.

Rabbi Uri Regev, head of Hiddush - Freedom of Religion for Israel, called the ILA's decision a victory. But he warned that "even after the disqualification, there's a fear that only one out of every five apartment purchasers will be non-Haredi."

Sasson Tiram
Nimrod Glickman