Antitrust Head Announces Her Surprise Resignation

Ronit Kan will leave her post almost a year early.

Antitrust Commissioner Ronit Kan yesterday announced that she will be stepping down at the beginning of 2011, nearly a year before her term was scheduled to end. She attributed her early departure to a desire not to weaken the Antitrust Authority by her "lame duck" status.

"I wanted the timing of the departure to be within my control," she explained, "at a time of my choosing and when the engine of the Antitrust Authority was moving ahead at full steam." She said she did not wait to inform Industry, Trade and Labor Minister Benjamin Ben-Eliezer of her decision.

Ronit Kan
Eyal Toueg

Speaking yesterday, Kan said it was her "great privilege" to head the authority during turbulent economic times. Kan, who in the past has said her aspirations lay in public service, said yesterday that her decision to resign early did not come on the heels of another job offer. She said she plans to take time off to consider her options and would not rule out a job in academia or in the private sector.

Kan expressed pride in her accomplishments as antitrust commissioner, thanks to Ben-Eliezer for his support in fostering competition and appreciation for the authority's staff.

Ben-Eliezer underlined the importance of competition in times of economic crisis. He thanked Kan for her efforts and praised her courage and professional integrity.

Observers expect leading candidates to succeed Kan in the post to include the three finalists who lost out to Kan when she was appointed to the position six years ago, as well as new candidates with a background in antitrust. The finalists the last time around included attorney Nir Epstein, former Antitrust Authority legal adviser Michal Halperin and former Communications Ministry Deputy Director General Assaf Cohen.

Not a political appointment

Kan's announcement yesterday was not her first surprise. She surprised observers over six years ago when, as deputy director general for foreign trade in the Industry, Trade and Labor Ministry she applied for the coveted and influential position of antitrust commissioner. Among the agency's authorities are the power to demand the imprisonment of errant high-ranking executives.

Because Kan's appointment was cooked up in the kitchen of Ehud Olmert, who was Industry, Trade and Labor Minister at the time, she was seen as someone who had to work that much harder to prove that she was worthy of the appointment and did not get it simply because she was an Olmert associate.

One of her first major decisions was to block the merger of the Sonol and Dor Alon gas station chains. She earned the wrath of Dor Alon chairman Dudi Wiessman, who appealed to the Supreme Court but lost.

Kan was a quick study during her first year on the job, mastering the issues and even broadening her authority into areas her predecessors had not touched. As someone without private business ambitions she did not hesitate to take on Israel's multimillionaires.

Even before the start of the public debate over the a threat to democracy posed by the concentration of economic power in the hands of a few, Kan declared that she would not allow IDB group controlling shareholder Nochi Dankner to buy a major bank. Dankner had shown interest in acquiring Bank Leumi or Bank Hapoalim, and Kan made it clear to him that his efforts would be a waste of time. To avoid being perceived as having it in for IDB she said she would not approve the purchase of a major bank by any party that owned a large corporation, and she stuck to her guns on that point.

She did battle against IDB again, however, with an investigation into the relationships between the group's Super-Sol supermarket chain and its suppliers. The investigation led to indictments on charges of violating conditions set by the Antitrust Authority for its approval of the chain's merger with Clubmarket.

Focus on competition in specific sectors

But Kan did not broaden her authority to issues of competition that cut across the entire economy. She said the law did not provide for such sweeping action. History seems to be proving her right.

Antitrust agencies around the world are proving apt at increasing competition in specific sectors, such as communications, water and retailing, but not on a broader national level.

Kan exerted her authority over the Borovich family, the controlling shareholders in El Al Airlines and, in a precedent-setting move, brought the aviation sector under antitrust supervision and began blocking airline deals that hurt consumers.

She also pushed through laws aimed to reduce economic concentration in areas such as communications and banking, and legislation was drafted that would give her successor full authority to increase competition in every sector.

Kan also attempted to deal with the lack of competition in the credit card transaction clearing house industry. She struck a deal that lowered the commissions customary in transactions between credit card companies from 1.25% to 0.875%, but the largest player in the industry, Isracard, managed to remain outside the arrangement.

But Kan did not obtain the broader authority she had sought to deal with the banks and insurance companies. These fields were left primarily under the control of the Bank of Israel and the Finance Ministry.