State says it is not responsible for oil spill from pipeline established in 1960s in partnership between Israeli and Iranian governments.
Zafrir Rinat May 16, 2016

The state refuses to comment on its link with the Eilat-Ashkelon Pipeline Company, arguing that at any rate it is wrong to hold the state responsible for the oil spill a year-and-a-half ago in the Evrona Nature Reserve.

The state made this argument last week in Be’er Sheva District Court, during a hearing on payment of restitution to the public for the pollution of the Negev nature reserve, caused by the spill on December 3, 2014.

The request to the court to approve a class-action suit demanding compensation for residents of the Arava region named not only the EAPC, but the Finance Ministry, the prime minister and the accountant-general at the time of the incident, with the plaintiffs claiming they were responsible for managing the pipeline company. The state, at a hearing last week before Judge Rachel Lavi-Barkai, is asking to deny the inclusion of government officials or agencies in the suit.

The plaintiffs argue that the state used a section in the Products and Services Oversight Law to allow the finance minister to appoint someone to deal with the company so that the state could effectively operate it, and to the best of their knowledge in the case of EAPC, it was the accountant-general. By law, the activities of the EAPC are classified.

Attorney Orit Kratz, representing the State Attorney’s Office, said, “It isn’t clear to us what the grounds are for this argument and there is no evidentiary basis for it. Can one conclude from the fact that the Products and Services Oversight Law allows the finance minister to appoint a supervisor of a company, that he actually appointed the accountant-general to manage the EAPC?”

Afterward, Kratz said, “It’s important to stress that given the confidentiality order the state cannot confirm or deny the arguments about the relationship between the State of Israel and the EAPC.”

She later added, “To the extent that [the plaintiffs} seek to attribute to the state and its officials responsibility [for the oil spill] because they are officers of the EAPC, and without confirming this, I believe that first of all, it hasn’t been proven that the state is an officer in the EAPC, and second, the certainly doesn’t mean that every officer of a company that causes environmental damage can be sued in a class-action suit.”

The lawyer for the plaintiffs, Asaf Fink, argued that it’s important to keep the state officials in the legal proceedings. He maintained that if the state actually does control the company, and the proceedings end up determining that compensation must be paid, it isn’t known if the EAPC has the financial resources to do so.

During the hearing, the state proposed to present to the court details relating to the question of whether the state has a relationship with the EAPC, without the plaintiff’s attorneys present. The plaintiffs objected, and the court will decide on that issue during the next few weeks.

EAPC was established in the 1960s as a partnership between the Israeli and Iranian governments. Its main purpose was the transport of crude oil from Eilat to refineries elsewhere in Israel. After the Iranian revolution and the fall of the Shah in 1979, the company was left under the oversight of the Israeli government.

The fate of its assets, which were under joint ownership with the Iranian government, went to international arbitration. In light of the sensitivity of the company, EAPC has been run under an order of absolute immunity, which prevents revealing information about its operations.

Zafrir Rinat
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