Israel’s Slot Machines Are Turned Off Yet Again by Court Order

Meanwhile, Finance Minister Kahlon’s other big anti-gambling initiative to end off-track betting on British horse races also was running into trouble.

Mifal Hapayis slot machines. Off for the time being.
Ofer Vaknin

The saga of Israel’s on-again, off-again slot machines reverted back to off Wednesday after the High Court of Justice reversed an earlier decision and ordered the state lottery company to turn them off.

The decision by Justice Yoram Danzinger, responding to a petition from lottery franchisees, came just two days after he had ordered Mifal Hapayis to turn them on. That first injunction was issued just a week after the company had turned them off at the behest of the treasury and its battle against state-sponsored gambling.

Danzinger said he reversed himself after hearing arguments by the treasury and Mifal Hapayis in favor of keeping off the 650 or so slot and keno machines operated around the country by the company, until a final ruling on the franchisees’ petition.

Mifal Hapayis franchisees, who operate the machines and sell lottery tickets, had sought to block the treasury from shutting down the machines on the grounds they had not been given enough notice to prepare themselves for the lost revenue and are seeking a grace period.

But on Wednesday the treasury noted that the cabinet had approved a proposal for ending electronic gambling last August, prompting Danziger to respond, “I see no way of avoiding rescinding the temporary injunction.” The machines went silent at 6 P.M. Wednesday.

Meanwhile, Finance Minister Moshe Kahlon’s other big anti-gambling initiative to end off-track betting on British horse races also was running into trouble after the U.K. company that provides the service to Mifal Hapayis threatened a lawsuit if its contract was canceled before it expires in 2018.

John Singer, who is charge of regional operations for GBI Racing, warned that compensation could reach into the hundreds of millions of shekels. GBI has been offering horse-race betting in Israel since 2013.

“We have no disagreement about the existence of a signed contract with the government and we need to honor it,” Shai Babad, the treasury’s director general, said in response. “However, there is a clause in the contract that allows it to be reopened. It can’t be that a contract will dictate Israeli government policy and prevent the government from reconsidering earlier policy decisions.”