Challenging the State's Discriminatory Compensation Scheme for War Damages

Petition filed in 9/06, challenging the state’s compensation scheme for war damages incurred during the Second Lebanon War between Israel and Hizbullah of July-August 2006 under the amended Property Tax Regulations and Restitution Fund (Compensations Payments) (Direct and Indirect War Damages) (Temporary Order) – 2006 to businesses and non-governmental organizations (NGOs) as discriminatory against Arab towns in the north of Israel and Arab citizens of Israel. Specifically, the petition challenged three designations and compensation formulas regulated by the Finance Minister in 7/06 as they apply to ‘border towns’, ‘restricted towns’ and NGOs. The petition sought an order requiring the Minister to grant ‘border town’ status to four Arab villages in the north of Israel which suffered serious damage during the war, and are located on or very close to the border with Lebanon in close geographic proximity to Jewish towns granted the such status, and thus eligible for higher compensation payments. Adalah further requested that an equitable policy be determined for the calculation of compensation for the remaining towns and villages in the north classified as ‘restricted towns,’ and demanded that the Minister not exclude NGOs from those organizations and businesses entitled to compensation. In 12/06, the Court ordered the Finance Minister to show cause as to why one calculation method should not be used for all towns and villages in the north, and compelled him to explain the reasons for excluding businesses in the four Arab villages from full compensation.

Update: In 1/07, the Finance Ministry announced its agreement to include the four Arab villages in the list of ‘border towns’, making business-owners in the four villages eligible for full compensation from the state not only for damages incurred during the Second Lebanon War, but also retroactively for damages sustained since 1973. The ministry also added 19 Jewish towns and villages to the list of ‘border towns’, all of which fall within nine kilometers from the Israeli-Lebanese border. The additional demands raised in the petition remain pending before the Supreme Court.

H.C. 7444/06, Abeer Shehade, et al. v. The Minister of Finance, et al. (case pending)