The Ministry of Communications is expected to publish its decision this week to impose a NIS 30 million penalty on Golan Telecom Ltd., after the company dismantled its network without permission. The decision was taken several weeks ago, but because of vacation was not published. It will now be published, as the Ministry of Communications promised the High Court of Justice.
The fine levied against Golan Telecom is being foreclosed from the guarantees from the company in the possession of the Ministry of Communications. The decision means that Golan Telecom must replace the amount of the fine in its guarantee. In view of the company's situation, Golan Telecom will almost certainly prefer initially to file an appeal of the decision, order to gain time and try to find a buyer for the company. Judging by Golan Telecom's conduct, it is difficult to see the company paying NIS 30 million now for a guarantee.
When the foreclosure decision is published, a long and fatiguing process of attempts to bring Golan Telecom to justice will have been completed. The company does not deny dismantling its network without authorization, and in the past even declared that it was willing to pay a fine for it. At the same time, however, the company did believe that the fine would be so large and disproportionate, as it believes, and will therefore appeal it.
The decision to foreclose Golan Telecom's guarantee comes at the same time as a High Court of Justice petition by Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) against the Ministry of Communications for not enforcing the terms of Golan Telecom's license and not penalizing it for the violations of its license. The state responded to Partner's petition by saying that it was in the middle of examining the matter, and did not intend to allow Golan Telecom to evade punishment if it finds that the company indeed violated its license. The state therefore asked the court to dismiss the petition. The High Court of Justice therefore did not dismiss the petition, but agreed to accept a commitment by the state to publish its decision on the foreclosure within a month, i.e. by the end of August.
Published by Globes [online], Israel business news - www.globes-online.com - on August 28, 2016
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