Finance chair: Cross-ownership endangers our democracy

Members of the Knesset Finance Committee spoke in favor of cracking down on cross-ownership of financial and non-financial holdings.

October 27, 2011 04:25
2 minute read.
MK Moshe Gafni

MK Moshe Gafni 311. (photo credit: Courtesy)


Dear Reader,
As you can imagine, more people are reading The Jerusalem Post than ever before. Nevertheless, traditional business models are no longer sustainable and high-quality publications, like ours, are being forced to look for new ways to keep going. Unlike many other news organizations, we have not put up a paywall. We want to keep our journalism open and accessible and be able to keep providing you with news and analyses from the frontlines of Israel, the Middle East and the Jewish World.

As one of our loyal readers, we ask you to be our partner.

For $5 a month you will receive access to the following:

  • A user uxperience almost completely free of ads
  • Access to our Premium Section and our monthly magazine to learn Hebrew, Ivrit
  • Content from the award-winning Jerusalem Repor
  • A brand new ePaper featuring the daily newspaper as it appears in print in Israel

Help us grow and continue telling Israel’s story to the world.

Thank you,

Ronit Hasin-Hochman, CEO, Jerusalem Post Group
Yaakov Katz, Editor-in-Chief

UPGRADE YOUR JPOST EXPERIENCE FOR 5$ PER MONTH Show me later Don't show it again

Members of the Knesset Finance Committee spoke in favor of cracking down on cross-ownership of financial and non-financial holdings during a debate Wednesday on proposals made by a committee on market concentration.

“Economic concentration causes real harm to competition and endangers democracy. The fact that a very small amount of people simultaneously control financial and non-financial holdings, and even media companies, is unacceptable,” Finance Committee Chairman Moshe Gafni (UTJ) said.

Be the first to know - Join our Facebook page.

“We could find ourselves in a situation in which a small number of groups with a huge amount of power – part of which they obtained from state funding – could raise prices, and that nobody would say a thing and the media would not raise criticism because those same people are in charge there, too. This is an apocalyptic forecast, but it could happen.”

The Committee on Strengthening Market Competitiveness released its report in September, recommending a prohibition on control of financial institutions by large non-financial corporations, or by companies which control large non-financial corporations. It defined large financial corporations as companies with NIS 50 billion, or more, in assets under management and large non-financials as companies with more than NIS 8 billion in sales.

That committee’s chairman, Finance Ministry Director-General Haim Shani, told the Knesset Finance Committee that in comparison to the rest of the world, “the Israeli economy is one of the most highly concentrated, in that 10 large groups hold 41% of the value of public companies.”

MK Shai Hermesh (Kadima) argued the committee did not touch on concentration within specific industries, and therefore “missed out on a major source of harm to competition.”

MK Zahava Gal-On (Meretz) also criticized the committee, calling its conclusions “too restrained.” She added: “Tycoons like Sheri Arison and Nochi Dankner will be able to evade these recommendations.”

Gal-On said lawmakers should legislate for the complete separation of financial and non-financial holdings, “beginning with the first shekel.”

Prof. Eugene Kandel, chairman of the National Economic Council in the Prime Minister’s Office and a member of the concentration committee, said the recommendations had “far-reaching consequences,” and warned against taking any more dramatic steps that could harm the economy.

Final recommendations will be submitted to the cabinet within two months, after public submissions have been heard.

Related Content

August 31, 2014
Rioting resumes throughout east Jerusalem Saturday night