It appears that the congolmerates that control most of the Israeli economy are in the government’s sights and economic reform could be in near future. The Knesset Economic Affairs Committee recently approved a bill that would allow the Antitrust Authority to exercise its trust-busting powers in industries where a small number of companies posses more than 50% of the market share and there is little to no competition.

The bill, which has been under debate for the last year, has raised the ire of numerous industries, such as the banking industry, who vigorously objected to ceding their regulatory powers to a government entity. The insurance commissioner also objected to government interference in the industry. The Economic Affairs committee, however, decided that there would be no exceptions.

If the bill passes the next two readings in the Knesset, it will become law. Under the current version, the Antitrust Authority will be able to order companies to allow competition and end their monopolies. When necessary, major conglomerates would be forced to sell divisions in order to boost competition levels. In addition, the Antitrust Authority would be required to coordinate with regulators of specific industries when they are already present in an industry with low levels of competition.

At the hearing yesterday, Bank of Israel officials said the bill was not what the Committee for Legislation had agreed to and again voiced their objection together with the insurance industry. The Economic Affairs Committee dismissed this claim, saying two industry’s objections would gut the law of its power and refused to grant any exceptions.

According to the retiring Antitrust Commissioner, Ronit Kan, the bill “has immense value from the standpoint of competition and the economy and has been a work in process for several years.” She added that the finished bill will allow her successor to solve competition problems, although it would be difficult to enforce such measures. Kan is retiring this month and there is concern that the next Commissioner would be someone biased towards the industry leaders. Industry Minister Shalom Simhon said the announcement of the commission would be on March 3rd.