Customs & Trade in Israel

24 August, 2022

The Court Approved Administrative Forfeiture Under the Counter Terrorism Law


The plaintiff petitioned the Tel Aviv District Court, demanding that an administrative forfeiture order be rescinded. The order was issued by the Defense Minister due to “national security” concerns, and relates to two shipping containers imported by the plaintiff to Israel.

Case Facts

The plaintiff stated that he is a well-established textile importer, the owner of an office in China that serves many clients in the Gaza Strip, and therefore often serves as a middleman between Gazan importers and Chinese factories. Under these circumstances, he was approached by three Gazan clothing importers, who the plaintiff aided in ordering textile goods from China. The Chinese supplier received most of the payment for the order, packed the goods in two containers and shipped the containers to the Ashdod port.

Upon arrival in Israel, the containers were subject to a security examination, during which 13 boxes with goods violating intellectual property rights (brand imitations) were separated from the rest of the goods, as part of a proceeding involving the brand owners whose rights were violated. Even so, the rest of the goods were seized by the Defense Ministry, which claimed that the seizure was intended for preventing the activity of a terrorist organization and limiting its ability to advance its goals.

The plaintiff appealed the seizure before the Defense Ministry, which not only rejected the appeal but added that it intends to recommend the forfeiture of the goods by an administrative order under the Counter Terrorism Law 2016, as indeed happened. Under these circumstances, the plaintiff turned to the District Court.

The Parties’ Arguments

The plaintiff argued that the seizure order was issued without any presented reason, save for the statement that the order was issued for national security concerns, without any option to view the source of this information. According to the plaintiff, the result of the seizure is a significant violation of his own right to decent income and livelihood, as well as the rights of the owners of the goods (the three importers), in direct contrast with a Basic Law. Therefore, the forfeiture itself, without the option to address the national security argument, is a severe violation of his property and commercial freedom, in light of the overwhelming power demonstrated by the forfeiture act.

The defendant (the Defense Ministry) argued that the goods’ seizure order was issued under the power granted to it by the Counter Terrorism Law and based on intelligence that the seized goods are owned by a terrorist organization and intended for advancing its goals, or at the very least intended to finance the activity of a terrorist organization, in itself a severe terrorism offence. The defendant clarified that the goods were not seized due to the illegality of the goods themselves, rather due to the fact that the shipment, as a whole, is the property of a terrorist organization or at least a tool for financing such an organization.

The Court’s Ruling

In order to back its claim that the goods are property of a terrorist organization or a tool for financing such an organization, the defendant presented classified intelligence to the court (for the court’s eyes alone), which contradicted many of the plaintiff’s claims. Following the court’s review of the information and subsequent clarifying explanations, the court was convinced that the seized goods were indeed owned by or intended to finance a terrorist organization, and concluded that the plaintiff’s appeal was to be rejected.

The court stressed the importance of granting the administrative authority forfeiture tools in the struggle against terrorism, where all property found to meet the criteria of “terror property” may be seized and eventually forfeited by the authority.

In addition to bodily harm, continued the court, at the basis of some terror offences lie economic motives, and the State’s goal through the administrative forfeiture tool is to pull the economic rug financing terrorist organizations from under their feet.

The court thus granted clear preference to the tools aiding the authorities in their struggle against the terrorist threats faced by the State of Israel over individual property rights, when under the specific circumstances of the case the forfeiture will assist in harming the economic infrastructure of a terrorist organization and add to the deterrence of such activity in the future.

Despite the above, the court issued the plaintiff costs of only 10,000 ILS.

[TA 54353-03-19, Saddam Farhat V. The Defense Ministry – The State of Israel; Mr. Farhat represented by Adv. Aviram Vazana]

The content in this communication is provided for informational purposes only and is not intended to be comprehensive. It does not serve to replace professional legal advice required on a case by case basis. The firm does not undertake to update the information in this communication or its recipients about any normative, legal or other changes that may impact the subject matter of this communication.

Written by: Adv. Gill Nadel, Adv. Dave Zeitoun, Adv. Ranon Gurtenshtein

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