Appeal Petition/Administrative Claim 23432-11-24 Metro Motor Marketing (1981) Ltd. v. Ministry of Transport and Road Safety Vehicle and Maintenance Services Division - part 11

Vice President Noam Sohlberg:

1. I agree with my colleague, Justice Mintz; the appeal should be dismissed. I will add a few comments regarding some of the issues that arise in our case.

On the special importance of industry competition considerations in this context

2. As my colleague noted, in the framework of the work of interpretation, we must trace the meaning of the legislation in the relevant context, in the 'living environment' of that piece of legislation: "A necessary condition, without which there is no trace of the most appropriate linguistic meaning of a term, at least as far as legal interpretation is concerned, lies in understanding the context in which that term is found. Indeed, nothing of legislation hovers in a vacuum, in the "world of ideas," or in a dictionary; It is contained within a law, which regulates a certain area of life, with its own logic" (Additional Administrative Hearing 5331/24  Population and Immigration Authority v. Clement, para. 44 (December 7, 2025) (hereinafter: Additional Hearing Clement Administrations; for more on this point, see ibid., paragraphs 37-43).  This is true in general, and in our case – in particular.  Thus,  it is not possible to trace the current interpretation of Section 45 of the Licensing of Services and Professions in the Automotive Industry Law, 5776-2016 (hereinafter: the Licensing Law), detached from the provisions of Section C of Chapter B of the Law for the Promotion of Competition and the Reduction of Concentration,  5774-2013  (hereinafter: the Concentration Law), to which he referres; And as my colleague has well shown, from this point of view, the clear interpretive conclusion is that section  45 of the Licensing Law, together  with section 11 of the Concentration Law, grants the Director (as defined in section 2 of the Licensing Law) the authority not to renew an import license for considerations of promoting competition and reducing concentration.
3. I will not repeat what my colleague detailed. I would like to emphasize this: any other interpretation – and in particular, the one that the appellant seeks to adopt – not only renders the provisions  of section 45 of the Licensing Law meaningless, with regard to the renewal of a license; but directly undermines the purpose of promoting competition – a main and central purpose that the legislature sought to promote by means of the legislation on the agenda.  Without exhausting, I will note that  section  1 of the Licensing Law, which specifies the objectives of the law, explicitly establishes "the promotion of competition in the automotive industry" as one of its purposes.  This is fine in general, as a principle that hovers over the Licensing Law when we come to interpret its provisions, but it is all the more beautiful in the context at hand, since the title of  section  45 is "Promotion of competition and reduction of concentration in the vehicle import industry".  The importance that the legislature saw in advancing this purpose is therefore open and clear over the law itself (and see, also, in the level of the subjective purpose of the Licensing Law, the excerpts brought by the members of the legislative debates, in paragraphs 36-39 of its opinion; it seems to me that the intention of the legislature that arises from them is well consistent with what has been said).
4. This is all the more relevant, against the background of the purpose of the arrangement enshrined in paragraph C of chapter B of the Concentration Law (to which section 45 of the Licensing Law relates, as aforesaid  ).  The same purpose, of promoting competition, is clearly reflected in the provisions of the Mark – in particular in the context of a regulator's decision to grant or renew a license.  Thus, for example,  section  11(a) of the Law states that "in allocating a right and in determining the conditions for that right, the regulator shall take into account, in addition to any other consideration that he must consider by law with regard to the allocation, considerations of promoting industry competitiveness"; and section 11(b) after it  , with respect to the rights listed in the list of rights,  stating that "the regulator shall not assign the said right until it has considered considerations of promoting industry competitiveness as stated in subsection (a), in consultation with the Commissioner of Competition" (emphasis added – v. S.; for the fact that the license in question is included in the list of rights, see paragraph 4 of my colleague's opinion).
5. The Concentration Law is based on the recommendations of the Committee for Increasing Competitiveness in the Economy (see: Proposed Law to Promote Competition and Reduce Concentration, 5772-2012, H.H. 706, 1084 (hereinafter: the Concentration Bill)).  According to the Committee's position, "the procedures for allocating rights and assets can be an excellent opportunity for the government to act to increase competition and reduce concentration in the economy's sectors, by changing the structure of industries and opening them to competition, in a way that will lead to efficiency, lower prices, promote innovation of services and products, and improve their quality and diversity" (Draft Recommendations of the Committee for Increasing Competitiveness in the Economy, p. 211; see also: The Committee for Increasing Competitiveness in the Economy – Final Recommendations and Supplement to the Interim Report,  pp. 15-16 (2012)).  In addition, the title of Section C is "Considerations of Industry Competition in the Allocation of Rights".  In the explanatory notes to the Concentration Law, the following are written in this context:

"Industry competitiveness considerations are concerned with the competitive effect that may have on the allocation of certain types of rights to the industry in which they are allocated.  [...] These considerations require a competitive examination of the industry, the degree of competition in it, and the degree of industry concentration.  It should be remembered that the allocation of rights to private hands is not an end in itself, but rather a means to achieve other interests.  Therefore, if it turns out that the allocation of rights or assets, in their current form, is liable to harm the competitiveness of the economy or create an overconcentration of assets or rights in any private entity, the decision makers should refrain from it altogether, reject it, or set restrictive conditions within the framework of the allocation that will prevent harm to the public interest" (Concentration Bill, p. 1085; Emphasis added – v. S.).

6. If so, there can be no dispute about the importance that the legislature saw in promoting competition in the framework of the allocation of rights in general (see also: section  5 of the Concentration Law; the Concentration Bill, p. 1091); and in the concrete context of granting or renewing a license for the commercial import of vehicles, in particular.  If this is the case, the difficulty is sharpened to accept an interpretation according to which the director is not authorized to refuse to renew a license based on considerations of competition.  Such an interpretation is inconsistent with the relevant provisions of the law, and undermines the main purpose that the legislature sought to promote by means of them.  Of course, this is unacceptable.
7. It seems to me that what has been said so far also has implications for another issue – the evidentiary standard. The appellant argued before us that in our case the manager should have relied on "clear, unequivocal and convincing evidence" when he came to make the decision not to renew the license for reasons of competition; and even to show that there is  "close, and perhaps even almost absolute certainty" that the decision will indeed lead to the promotion of competition.  It is difficult to accept this position.
8. It goes without saying that a decision not to renew a license is a decision with weighty implications, which requires relying on an in-depth, serious and solid factual foundation: "Serious information with evidentiary weight is required in order to justify a decision in this direction" (High Court of Justice 237/81 Dabul v. Petah Tikva Municipality, IsrSC 36(3) 365, 377 (1982) (hereinafter: the Dabul case)). However, the adoption of such a stringent threshold, such as the one called for by the appellant, is liable to render, in practice, the ability of the Director to consider competition considerations in the decision to allocate a license for the commercial import of vehicles.  The reason for this is that the analysis of the behavior of market players given a certain future allocation is based by its very  nature on an evaluative-probabilistic dimension, when there are a variety of factors that can influence the course of development of that market.  Given the inherent uncertainty in such an analysis, relying on "unequivocal" evidence, such as that indicates a near and "even almost absolute"  certainty that the state of competition in the market will improve as a result of the decision, it is not possible.  Therefore, and in particular taking into account the importance of competition considerations in our case, as detailed above, it is not possible to adopt the evidentiary standard set by the appellant – such a standard will lead, in practice, to turning the provisions of the law regarding the manager's consideration of competition considerations into a 'dead letter', with no effect in practice (I will emphasize again that the aforesaid does not detract from the requirement to be based on a deep and serious factual basis, in the framework of decision-making such as this).  I will note that such a threshold regarding the non-renewal of a license – as opposed to the cancellation of  an existing license – does not arise from the case law to which the appellant referred (see, for example: the Dabul case, at p. 377).

Consultation with the Advisory Board

9. Section 61(1)(a) of the Licensing Law states that the Advisory Council shall advise the Director in all matters relating to "refusal to grant a commercial importer's license, cancellation of the license, suspension or refusal to renew it, in accordance with Sections 8 and 10." The appellant argues that the director did not consult the council prior to making the decision, and therefore it should be revoked.  I will not deny that there is considerable reason in the appellant's arguments regarding this matter.  Thus, from a review of the discussions that took place on the bill, it is possible to identify a certain intention – although not unequivocally – to apply the obligation to consult in the Council, even in the context of non-allocation of a right by  virtue of section  45 of the law (see  minutes of the 163rd session of the Economic Affairs Committee, 20th Knesset, 4-7 (February 14, 2016)).  Moreover, the logic of the matter also teaches that if the main reason underlying the obligation to consult with the Council is the severe consequences of a decision not to allocate a right, it is difficult to think of a relevant distinction between such a decision by virtue  of sections  8 and 10 of the Licensing Law, and such a decision made by virtue of section 45.  It is possible that this is even more so, in view of the fact that unlike non-renewal of a license based on  sections  8 or 10, such a decision by virtue  of section  45 is not based on improper conduct on the part of the license holder, so that on the face of it, the need or justification for holding a preliminary consultation – but it is sharpened.
10. However, the language of the section is clear, and it is not ambiguous. The scope of applicability it defines is interpreted as decisions "in accordance with sections 8 and 10"; nothing more.  In these circumstances, and knowing that the boundaries of interpretation are the boundaries of language, it cannot be said that the arrangement established by  section  61(1)(a) also  applies to a decision by virtue of section 45 (see also, as to the difficulty in using the "kal ve-kor" steps for the purpose of supplementation that is not enumerated in the provisions of the law: Additional Discussion of Clement Administrations, paragraph 91; Civil Appeals Authority 2773/24 Anonymous v. Compensation Officer, para. 14 (June 2, 2024)).
11. In the bill that was initially presented to the members of the Knesset, the section was broadly worded, so that it was proposed that the Council advise the Director in cases of "refusal to grant a vehicle importer's license, suspension of its cancellation or refusal to renew it"  (Vehicle Services Licensing Bill, 5773-2013, H.H. 769, 790); Only later, after the discussions in the Economic Affairs Committee, was the scope of the section's application limited to decisions made in accordance with  sections  8 and 10 only.  The probable conclusion, therefore, is that the demarcation of the decisions regarding which consultation in the Council is required is not coincidental.  However, I will note, with a forward-looking view, that it may be well for those concerned to consider whether the current arrangement does indeed bring about an optimal compatibility between the language of the clause and the scope of its application and its purpose, and decide according to their wisdom (needless to say, I do not express a position on the merits of the matter).

On the nature of the harm caused in our case

12. The appellant argues that the Administration's decision violates her constitutional rights to property and freedom of occupation in a disproportionate manner. My colleague assumed that there was indeed a violation of these rights, and examined only the proportionality of the infringement.  As for myself, I am of the opinion that there is a certain difficulty in moving to the test of proportionality, without tracing the nature and nature of the violation of the constitutional right (I have elaborated on the reasons for this elsewhere; see: Noam Sohlberg and Omri Goldwin, "The Few Who Hold the Majority: On the Scope of the Interpretation of Constitutional Rights" Mishpatim 55 (forthcoming); For further criticisms of the rather widespread practice of "skipping" the question of the violation of the right, see, for example:  Ido Porat,  "The Administration of Constitutional Law," Iyunei Mishpat 37:713, 720-721, 727 (2016); Sigal Kogut and Efrat Hakak: "Has a constitutional right been violated?The  Need to Establish Clear Definitions of a Constitutional Right – The Constitutional Right to Equality as a Parable," Sha'arei Mishpat 7 99 (2014); Avichai Dorfman, "Respect for Man and Israeli Constitutional Law," Mishpatim 36 111, 159-160 (2013)).  I will therefore turn to the question of whether the Administrator's decision violated the appellant's constitutional right.
13. At the outset, I would like to emphasize that we are dealing with a claim of infringement of the right to property and the right to freedom of occupation of a corporation – rights that our legal system, as a rule, recognizes (on the general issue of recognition of the constitutional rights of a corporation, see: High Court of Justice 3964/23 The Movement for Quality Government in Israel v. The Knesset, paragraphs 28-31 of my opinion (July 31, 2025) (hereinafter: High Court of Justice 3964/23); on the constitutional right to property of a private corporation, See, for example: High Court of Justice 4885/03 Israel Poultry Breeders Association Cooperative Agricultural Association in Tax  Appeal v. Government of Israel, IsrSC 59(2) 14, 66 (2004), and the variety of references therein; for recognition of the constitutional right to freedom of occupation of a corporation, see, for example: High Court of Justice 4406/16  Association of Banks in Israel v. Knesset of Israel, para. 34 (September 29, 2016)).  These determinations will serve as a starting point for the continuation of the discussion.

The Right to Freedom of Occupation

14. As to the claim of infringement of the right to freedom of occupation, I am of the opinion that the non-renewal of the license does indeed entail a violation of the appellant's right to freedom of occupation, as defined in the Basic Law: Freedom of Occupation. Thus, the decision according to which the appellant is not permitted to continue importing both Yamaha and Kawasaki products, and that it must choose only one of them, limits the scope of imports in which the appellant can engage, and limits the possibilities of its activity in the field.  However, although this infringement cannot be denied, we must not forget that "not every violation of freedom of occupation is on the same level.  It can be said that the restriction of the occupation by preventing it, denying it or closing the entrance to it is a more severe and severe violation than imposing restrictions on a person who engages in the profession or profession he desires, but the legislature imposed restrictions on the method of execution and its scope, in which case the infringement of the freedom of occupation does exist, but to a more tolerable extent" (HCJ 726/94 Clal Insurance Company in Tax  Appeal v. Minister of Finance,  IsrSC 48(5) 441, 475 (1994); See also: High Court of Justice 4769/95 Menachem v. Minister of Transport, IsrSC 57(1) 235, 260 (2002); High Court of Justice 5975/12 Vending Machine Cigarette Dispensers Division v. Ministry of Health, para. 9 (July 3, 2013)).
15. In our case, we are not dealing withthe denial of the appellant's ability to engage in the import of vehicles, even on an intensive and extensive basis, but rather with a specific restriction on the manner of realizing the business – the import of the products of the two aforementioned brands at the same time.  Therefore, this is a limited infringement, which is not on the serious side of the violation of the right to freedom of occupation (see also: High Court of Justice 3676/10 Keter in the Tax Appeal   Minister of Religious Services, para. 20 (May 8, 2014); High Court of Justice 678/15 Yedid v. Knesset, paragraphs 26-27 (July 9, 2015)).  Therefore, and against the background of the public interest in realizing the purpose of promoting competition, in accordance with the intention of the legislature, I am of the opinion, as my colleague Justice Mintz, that this is a proportionate infringement, which meets the conditions of the limitation clause (I will refer in this context to the reasons given by my colleague in paragraph 50 of his opinion; their logic is on their side).

The Right to Property

16. Regarding the question of infringement of the right to property, section  3 of the Basic Law:  Human Dignity and Liberty instructs us that "a person's property shall not be violated" (section  1 of the Interpretation Ordinance [New Version] allows this provision to be applied to a corporation as well).  Does the non-renewal of the license amount to damage to the appellant's property? I believe that the answer to this question is no.  The fundamental question of whether the constitutional protection of property extends its wings to benefits and rights of economic value that originate from the government authorities – those called 'new property' – has been discussed more than once in case law, but has not yet been decided (for a comprehensive review of the various positions on this issue, see: High Court of Justice 6792/10 DBS Satellite Services (1998) inTax Appeal v. Israeli Knesset, paragraphs 37-45 (July 20, 2014).  In a closed article, I will note that it is highly doubtful whether there is room to provide a categorical and uniform answer to this question, instead of progress in a more complex and moderate approach, through context-dependent decisions, as is the way of common law; See and compare my position with regard to the general question of whether taxation constitutes an infringement of the right to property, in High Court of Justice case 3964/23, paragraphs 53-54).
17. Indeed, a license for the commercial import of vehicles falls into this category, and hence, it is not impossible that, as a rule, the constitutional protection of property applies to it (I do not express a position on this question). However, whether or not this protection does indeed apply to a license such as this, we must distinguish carefully between a case of revocation of  an existing license and a case of non-renewal of a license: "A decision not to renew a license when it expires should not be equated with a decision not to renew a license, when it expires, and a decision to revoke a license while it is still in effect.  The latter type of decision is a more offensive decision" (Appeal Petition/Administrative Claim 3956/19 Al-Nal Import and Marketing inTax Appeal v. Ministry of Economy and Industry, para. 33 (February 16, 2020)), and the variety of references there (hereinafter: the Al-Nal case); see also: High Court of Justice 8082/15  The Association for the Elderly v. Ministry of Social Affairs and Social Services, para. 20 (July 10, 2016) (hereinafter: The case of the 35 Association; Dafna Barak-Erez, Administrative Law, Vol. 1, 404-405 (2010) (hereinafter: Barak-Erez)).
18. Thus, while in the case of cancellation of a license it can be said that a right granted to the license holder has been violated – that is, something in his possession has been taken from him – in the case of non-renewal of a license, it is not a denial of something that he already has, but rather a failure to realize the expectation of renewal of the license in the future; the license does not belong to him, until it is reassigned to him.  If we had said otherwise, we would have undermined the initial decision of the authority that allocated the license, to limit its validity within a specified period of time; and this would have even caused some tension with the authority's obligation to re-examine its discretion and policy (see: Barak-Erez, p. 51; see also, and compare: High Court of Justice 4806/94 S.A.  Environmental Protection inTax Appeal v. Minister of Finance, IsrSC 52(2) 193, 203-200 (1998)).  It cannot therefore be said that this is property that belongs to the appellant or is in her possession.  Therefore, and knowing that the purpose of the constitutional protection of property is "primarily to prevent the negation of what a person has; This is the harm that the Basic Law seeks to prevent" (Civil Appeal 6821/93  United Mizrahi Bank in Tax  Appeal v. Migdal Kfar Cooperative, IsrSC 49(4) 221, 328 (1995)) – the obvious conclusion is that this is not an infringement of the right to property (for the approach according to which actions to encourage competition in commercial contexts are not "an infringement of the right to property, but a derivative thereof", see: Hanoch Dagan Kinyan on Crossroads 193 (2005)).

Reliance and Expectation

19. I will emphasize that the aforesaid does not take lightly the harm that may be caused by the non-renewal of a license, in particular with regard to the license holder's interest of reliance and expectation; these are interests worthy of protection, and there is no dispute that a decision not to renew a license may cause the license holder significant damage (depending on the degree of reliance). Indeed, "the granting of the previous permit raises expectations in the heart of the permit recipient, and on the basis of these expectations, he finances his steps and invests his means in establishing and managing his business.  Failure to renew the permit is liable to cause him severe economic damage" (High Court of Justice 171/78 Ashkar in Tax  Appeal v. Minister of Labor and Social Welfare, IsrSC 36(3) 141, 148 (1982) (hereinafter: the Eshkar case)).
20. However, as it appears from the aforesaid, the normative source for the protection of these interests, in the context at hand, is not found in the laws of protection of the constitutional right to property, but in the rules of administrative law, which have been in practice with us since ancient times, and oblige the authority, inter alia, to rely on a special reason justifying the non-renewal of the license (see: High Court of Justice 24/56 Rotstein v. Herzliya Local Council, IsrSC 10 1205; 1208 (1956); Eshkar, p. 148; the case of the 35 Association, para. 20); relying on a factual basis (Da'abol, p. 377; Barak-Erez, p. 449); and by giving the license holder a proper opportunity to raise his arguments on the matter (see: Yitzhak Zamir  Administrative Authority 254 (2010); Barak-Erez, pp. 50-51).
21. As my colleague has shown, these requirements are met in our case. I will not elaborate, therefore, and I will refer to what was stated in his opinion (see ibid., paragraphs 49 and 51).  At the same time, I will note that, as a rule, there is room to give weight in cases such as this to the fact that the appellant is a strong and sophisticated actor, who is presumed to have been aware of the provisions of the law, and that she was able to finance her steps in reliance on them, while weighing the relevant risks (and compare, for example, to the appeal of Petition/Administrative Claim 4848/04 Bechor v. Sasson (September 20, 2007), where a decision not to grant a peddling license was discussed,  which is renewed every year).  In this sense, when receiving a commercial import license for a period of 6 years (as in our case), a player of the appellant's type can, as a rule, assess and weigh the risk involved in not renewing its license, inter alia, due to considerations of promoting competition and reducing concentration, and manage its actions accordingly.  However, in the present case, I did not see fit to attribute weight to this consideration, in view of the fact that the Director's decision is a precedent-setting decision, so that the ability to estimate in advance the probability that it will be accepted is somewhat less.
22. In summary, I am also of the opinion that the appeal should be dismissed.