The reforms would see the ministry lose its authority to set conditions for granting licenses to small and medium-sized businesses that may harm the environment

An environmental protest in Jerusalem last year.
An environmental protest in Jerusalem last year.Credit: Ohad Zwigenberg

Zafrir Rinat Aug. 3, 2021

The cabinet on Monday approved regulatory reforms that will reduce the power of the Environmental Protection Ministry and significantly impair its ability to perform its functions.

The changes, which are contained in the Arrangements Law, will make it harder for the ministry to act against small and medium-sized businesses whose activities allegedly harm the environment.

The measure must still win approval from the Knesset as part of the Arrangements law, a bill that accompanies the state budget.

The reforms are being led by the Finance Ministry, which claims that excessive regulations make it difficult for businesses in Israel and hurt their ability to compete with foreign rivals. They are part of a plan ministers approved to create a Regulatory and Reform Authority empowered to grant business licenses.

The authority will supervise new initiatives by government ministries involving business regulation and have the power to veto them. Focused on small and medium-sized businesses, the reforms call for the formation of a government committee to determine what criteria are needed to get a business license.

As a result, ministries’ powers over their portfolios will be reduced.

Smoke emitted from a hazardous waste disposal facility in Israel two months ago.
Smoke emitted from a hazardous waste disposal facility in Israel two months ago.Credit: Emil Salman

Environment Minister Tamar Zandberg, whose ministry will be particularly hit by the plan, opposed the new authority.  The power it now has to grant or revoke a business license is the main tool at its disposal to prevent damage to the environment by business enterprises.

Under the reforms, that power will move to the new committee, who will oversee, among other things, workshops and small factories, which often use hazardous material and pollute their surroundings. Its mandate will also include dry cleaners, which often use highly toxic chemicals. The ministry warned that if it cannot set criteria for awarding licenses, the public will be exposed to environmental dangers.

The Environment Ministry succeeded in altering some of the new clauses and limiting the damage to its powers, at least compared to how the law was originally formulated.

The most important of those changes was delaying reforms vis-à-vis waste-treatment facilities and gas stations for another four years. During that period, the Environment Ministry will continue to set business-license conditions of these facilities, which have the most significant environmental impact among small and medium-sized businesses.

Thus, for example, gas stations pose a risk to groundwater and can emit carcinogens into the air if not properly supervised. The ministry will prepare standards for business licenses that the committee can use later. The ministry will also add six new members to their staff to help prepare the standards.

Another change that was made to the reforms at the behest of the Environment Ministry was to limit the ability of the Regulatory Authority to rescind laws and regulations that the ministry backs. It will not have the power to rescind primary legislation at all. Regarding proposed regulations by the ministry, the authority will have the right to submit reservations or oppose them outright. In such a case, the issue will be given to the Ministerial Regulatory Committee, which will have six months to decide on the matter, otherwise the regulation will go into effect automatically.