ISRAEL Law and Practice Contributed by: Talya Solomon, Iris Achmon, Ekaterina Yaremchuk and Niva Orion, Herzog Fox & Neeman
In administrative cases, and sometimes in lieu of a criminal indictment, the Commissioner may request the Competition Tribunal to grant the force of a court order to an agreement between the Commissioner and another entity or person by way of a consent decree. A consent decree may or may not include an admission of liabil - ity by the breaching party, and it may include a monetary component to be paid to the Israeli state treasury. In theory, a consent decree can be reached at any stage of criminal or adminis - trative proceedings. However, while a criminal investigation may end with a consent decree, the authors are not aware of any case where a consent decree was reached after an indictment has been filed with the court. When no settlement is reached, litigation becomes necessary, which can be a lengthy and costly process. There is no sanction imposed on a person who refuses a plea bargain. 5.3 Effect of Liability Being Established The collateral effects of establishing liability in a procedure of the ICA are as follows. • Liability established in a criminal procedure – the court’s findings and conclusions in the conclusive incriminating verdict will be admis - sible as prima facie, evidence against the convicted offender or anyone whose liability stems from that of the convicted offender. The convicted offender will not be permitted to present contradicting evidence, except with the civil court’s permission. In addition, a civil follow-on action following a conclusive incriminating verdict may be brought before the same judge of the same court where the incriminating verdict was rendered, and criminal procedure’s findings will be deemed as findings that were established at the civil procedure.
• Liability established in an administrative procedure – an administrative determination of breach issued by the Commissioner serves as prima facie, evidence in any legal proceed - ings. Nonetheless, the defendant in a follow- on civil litigation will be entitled to submit contradictory evidence. • Possible debarment of the company and its officers from governmental bidding processes – certain government bidding processes may prohibit the participation of entities with cer - tain criminal records, including competition law breaches. These effects can only partly be avoided or miti - gated by a consent decree: a consent decree can be without admission of liability. However, if the consent decree includes admission of liabil - ity, such admission can be used in other actions. 5.4 Sanctions and Penalties in Criminal Proceedings See 1.2 Regulatory/Enforcement Agencies and Penalties for the sanctions and penalties in criminal and administrative procedures, and how they are calculated. The actual criminal sanction will be given by a judge and is a product of an adversary pro - ceeding: the sanctions mentioned above are the maximum sanctions set forth at the ECL. After a criminal judgment determines whether a breach was conducted, the phase of sentencing argu - ment begins. At this stage, both sides will make their arguments and the court will make a deci - sion. The highest prison sentence to date was 11 months. 5.5 History of Criminal Sanctions The largest criminal sanctions and penalties for restrictive arrangements are up to almost a year in prison and a fine of up to ILS1.4 million.
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