Press publications

Publication in The Marker of an article by Doron Afik: The unsettling easiness of a financial murder in Israel

June 1, 2010
Print
PDF

Publication in The Marker of an article by Doron Afik: The unsettling easiness of a financial murder in Israel
http://www.themarker.com/markets/1.568401
http://www.haaretz.co.il/misc/1.1204482
[Hebrew Only]

This article was written on a plane to the UK, on ​​its way to a mediation dispute in a conflict of tens of millions of euros. Britain is the homeland of James Bond, a murderer named Queen.

We in Israel also have a similar role. His name is the official receiver (the Knesset) and he liquidates businesses and companies on behalf of the state, only unintentionally. If I wanted to financially murder a leveraged businessman, all I had to do was apply for a restraining order. The likelihood of obtaining a single-party order depends mainly on several factors, none of which are related to the facts: the identity of the judge, the fabric story I invented and sometimes the position of the attorney general - a government body that claims to understand bankruptcy and liquidation proceedings. .

In the past, such an order was called a "sage order," and as a frightening name, it was treated with reverence. It is now called a restraining order, and the courts rule on it as a trivial matter. It seems, however, that the courts and the recommender sometimes do not understand what its real economic significance is. A more appropriate name for this order is "economic execution order." A prohibition on disposition is essentially similar to a bankruptcy proceeding (or liquidation in the case of a company) with only one difference: in bankruptcy, any disposition (transaction) of assets is prohibited, but at the same time there is protection against creditors. .

The prohibition on disposition prohibits any transaction in property, but without protection - all that is left is to wait for the economic collapse that will come. A chronicle of economic death is known in advance.

This was the case with the start-up company we represent and in which many millions have been invested. In a dispute between the shareholders, another of them, who owns less than 10% of the company and whose application for liquidation was rejected by the court, filed a financial false claim in the amount of NIS 1 million together with an application for a restraining order. The order was given by the Registrar of the Magistrates' Court casually, and it meant that the company could not take any action whatsoever and condemned to economic death. Because the order was given by a registrar, a hearing before a judge was scheduled at a relatively short time and the court overturned the order. In other cases, the appeal procedure is determined long after the decision has been made, and at this stage it is already a post-mortem, as long as there is an appeal - after a restraining order, it is also not possible to pay a lawyer or financial advisor.

It is difficult to blame the courts or the representatives of the Knesset, who sometimes give puzzling opinions. The jurists who make economic fates have never been real players in the market or studied it properly. An economic court may advance the issue, but only if it is required to make short-term decisions that will be enacted in legislation and receive financial advice or have economist party judges or lawyers in the field of mergers and acquisitions. Only those involved in the construction of complex economic transactions fully understand the market to deal with the collapse of these structures. A judge who does not meet the time limit set by law must bear the consequences just like a doctor who is negligent in surgery.

As long as the structure of the court dealing with the field does not change, there is room to revoke the authority to give an opinion from the attorney general, whose unnecessary opinion is required by law, and transfer it to another body which, as the Antitrust Authority, will have a strong economic department to study the market. Until then, as much as you want to blackmail a businessman in Israel, you only have to threaten a false claim and a request for a ban on disposition.