Proposed new legislation in Israel - another step in dedemocratisation

Please see below a letter summarising the possible impact of new legislation proposed in Knesset targeting Israeli dissident organisations.

Dear Colleagues and friends

We write with concern and to share with you a translation and brief analysis of the recent legislation proposed by Members of Knesset Elkin, Michaeli, Rotem, Schneller, Levin, Ben Ari, and Hotovely. The proposed legislation, steps away from being approved as law, would restrict the activities of a host of organizations working on a broad spectrum of issues in Israel and the occupied Palestinian territory – from environmental groups to peace organizations to organizations that promote human rights.

While the legislation purports to increase transparency concerning foreign funding of NGOs, in reality it will infringe on the ability of a wide variety of social change organizations to conduct their work. Find attached an unofficial translation of the proposed bill as it was circulated on Sunday, February 14, 2010.

The proposed legislation would impact our work in the following ways:

1. By removing our tax-exempt status: The legislation defines political activity so broadly that any organization "seeking to influence public opinion in Israel" would be labeled as political and would lose its tax-exempt status. That means that a social change organization would actually have to pay tax on donations or other income – even though as organizations serving the public good, we have no profits that could properly be taxed. This would have tremendous financial consequences. In addition, as many donors, government and private, have contractual limitations on their ability to pay taxes to a foreign government, removing our tax-exempt status would threaten our ability to receive donations entirely.

2. By restricting our speech with legal consequences for non-compliance: The unrealistic and unnecessary requirements of the law would force any spokesperson for an organization to announce its foreign government donors in any written material, electronic communication, meeting, interview or public appearance related to advocacy. If the spokesperson fails to do so, she may face fines or up to one year in jail.

To give an example: an executive director of an organization is invited to be interviewed on the radio to share her views on a new measure which negatively impacts a sector of society. In the 30 seconds allotted for her comments, she would also need to announce that foreign government donors support the work of her organization. If she doesn't, she could be arrested and sentenced to jail for up to one year.

Many organizations will face the difficult dilemma of declining badly-needed donations from foreign development funds – or subjecting themselves to the proposed law's draconian provisions.

Members' organisations (e.g., "Physicians for Human Rights-Israel", which includes medical professionals who are members or volunteers) will suffer further damage from the law, as members and volunteers will be deterred from joining or even cancel their membership. this is because the law applies to "principle activists of the recipient of support” - a definition that includes members in members' organisations.

Why is the law unnecessary? Because each non-profit organization in Israel is already required to list its donors and other financial information on its website and to report annually to the government, specifying whether foreign governments have donated money. This information is readily available. There already is complete transparency about organizations' funding, our mission, and our work.

We are very concerned about the motivations behind this proposed law and its ramifications for Israeli democracy and the robust civil society that is its strength. Burdening the activities of social change organizations, mischaracterizing them as "political" groups, subjecting them to criminal penalties, and taxing their donations are inappropriate measures for a democracy that respects freedom of expression and association.

We are concerned that the bill is slated to pass within a month. Three Knesset ministers, Dan Meridor (Likud), Isaac Herzog (Labor), and Shalom Simhon (Labor) opposed the legislation in Sunday's Ministerial Committee, and we believe there is room for members of the international community to express their concern regarding this proposed law. We note that this bill is one more step in a targeted campaign by the Israeli government to restrict the space in which human rights organizations may operate.

We will continue to update you as more developments occur.