Prime Minister Benjamin Netanyahu on Sunday became the first sitting Israeli leader to personally appear before the High Court of Justice as he defended his natural gas policy from five petitions filed by Zionist Union, Meretz and various NGOs in what has now become the most dramatic legal affair of our time.
Netanyahu spoke bluntly, telling the expanded five-justice panel, presided over by Deputy Supreme Court President Elyakim Rubinstein, “We are in the 90th [last] minute in terms of our ability to realize the potential of the State of Israel’s gas… every additional delay… could lead to grave results and it is doubtful if we could recover from them.”
Last week, Netanyahu took his first unprecedented move, filing a personal affidavit declaring emphatically to the High Court that, “there is no other realistic option” to exploit the country’s natural gas resources beside the one he has chosen.
The main purpose of the affidavit and then the personal appearance was to justify Netanyahu’s first-ever use of the power of the economy minister (a role he recently took over) to bypass the antitrust authority’s objections to the policy under Article 52 of the relevant law.
MK Shelly Yacimovich (Zionist Union), who has led the opposition to the deal, stated, “The appearance of the prime minister before the High Court was empty of any truthful substance; its entire purpose from beginning to end was not directed at convincing the court, rather to intimidate the court by virtue of the appearance occurring.”
She added, “The emphasis over and over from his [Netanyahu’s] own mouth about the unprecedented and rare nature of the appearance was designed to drill home the message and to deter the judges.”
She said the prime minister’s message and facts were “cut off from reality and full of intentionally misleading information.”
The petitioners’ lawyer, Avigdor Feldman, questioned how a democracy could operate with the prime minister making such a raw power grab, as he viewed the government’s actions of side-stepping the antitrust authority.
While he spoke, Netanyahu seemed to command the rapt attention of the justices. He was barely interrupted the entire time and was not pushed around by a single question of the type that lawyers are generally bombarded with.
It seemed like a special platform for him to give a public speech in favor of one of his key policies, with him turning side to side to the audience and the press as he spoke, not focused solely on the justices as is customary.
On the other hand, Rubinstein made Netanyahu wait for nearly 15 minutes before he and the other justices entered the room, something the prime minister is not used to. Then Rubinstein noted attendance of several dozen lawyers before recognizing Netanyahu, and after around 30 minutes he also twice lightly encouraged the prime minister to wrap up his remarks.
But the most surprising and possibly fateful move of the justices came hours later when they asked the state attorney to respond within seven days as to whether the aspect of the deal, which freezes the price of gas for 10 years could be passed in the Knesset instead of being authorized merely on his authority in his capacity as economy minister.
The policy and deal in question – a comprehensive accord aimed at settling disagreements between gas developers and the government – were officially activated on December 17 after Netanyahu signed a controversial legal clause enabling the framework to move forward.
Commonly known as the gas outline, the deal received cabinet approval in August, but faced additional obstacles due to failures to receive the antitrust commissioner’s approval.
Full realization of the gas deal ultimately required that the economy minister – a role currently being filled by Netanyahu – invoke a legal clause to circumvent the commissioner’s objections – Article 52 of the Restrictive Trade Practices Law (1988) and that the gas price and some other items be frozen for 10 years.
As part of the process of employing this article, Netanyahu was required to conduct consultations with the Knesset Economic Affairs Committee, chaired by MK Eitan Cabel (Zionist Union). While committee members voted against recommending the use of the clause, their conclusions were in no way legally binding and Netanyahu moved ahead without their approval.
All of this background plus the fact that with a mere one-vote majority in the Knesset – and two members of Knesset, who would likely be unable to vote – means that the state will likely need to tell the High Court that legislation is not an option.
The two Knesset members have a conflict of interest on the issue.
Though they were cleared by Knesset legal adviser Eyal Yinon to vote on a procedural issue related to the gas deal, they were concerned enough about the conflict that they did not even vote on that – meaning they would be even less likely to vote on the substance of the deal.
But this is only part of the issue, according to sources close to the deal, who indicated even more emphatically that there was no chance this would go back to the Knesset because the investors would then guaranteed walk away and bring the case to international arbitration where they would likely beat Israel.
The sources further added that without the 10-year price and other issues such as the stability clause, which they said were approved by the Knesset, the investors would never have agreed in the first place.
Finally, with the government having done everything it possibly could to facilitate the country’s energy security, if the High Court stops the deal it must take full responsibility for the consequences, said the sources.
As in his affidavit, the prime minister explained to the court that he had decided to use his authority under Article 52, after he was convinced that only “by intervening” could he “rescue the natural gas market in Israel from the freeze it went into after the former antitrust commissioner decided to withdraw support from the executive order to which he had agreed” with the developers of the Tamar and Leviathan reservoirs.
Also, as in the affidavit, he referred to January and February meetings he held with US Vice President Joseph Biden, the leaders of Greece and Cyprus and with contacts with Egypt and Turkey as enhanced relations – all due to anticipation from these countries that the gas deal is on the verge of moving forward.
Noting that 50 percent of the state’s electricity now flows from natural gas, the prime minister said that having only one reservoir running, Tamar, which is under potential threat of attack, leaves the country too exposed from a national security perspective.
Rejecting accusations that his gas deal empowers monopolies, Netanyahu held himself up as an ardent supporter of competition for 20 years and countered that the unlocking the current freeze on gas exploitation will encourage currently stifled competition.
Yacimovich contradicted the national security argument, saying his real motivations were related to satisfying his economic allies – developers.
Mor Gilboa, director of Green Course, said Netanyahu’s fearmongering had reached its peak and called his use of the word “security” during the proceedings “wild and unadulterated.”
“It will go down in history that [the deal] was served on a silver platter to Yitzhak Tshuva and Noble Energy.”
Despite attacks on his claims of national security and foreign policy concerns, the justices seemed to come to the prime minister’s defense.
One point Netanyahu emphasized more in his remarks than in his affidavit was the importance of keeping trust with the country’s private sector partners. He told the High Court that at the end of the day, successfully exploiting the state’s natural gas comes down “to one word – trust, international trust, trust of the investors, trust of the banks, of other countries, and I can say that during recent years, unfortunately [through all the delays to the deal] we have squandered this trust.”
He said that in recent months, he had rebuilt the trust, but it was still shaky and that the deal must be grasped speedily to maintain that trust.
Returning at the end of his speech to a catchphrase he once used for the Palestinians, he said, “if you give, you will receive” – meaning if Israel gives a green light to developers with the conditions that have been negotiated, the developers will exploit the natural gas for the state’s benefit.