Company sues PA, Israel for tourism losses
August 8, 2001
PA sued for Intifada damages
By Shmuel Dekalo and Roni Gelbfish
The first suit for Intifada damages against the Palestinian Authority (PA)
was filed today in the Jerusalem District Court. The claimant is Tel Aviv
Stock Exchange-listed Caprice Jewellery and three companies controlled by
it. They are suing the PA for damages due to the fall in tourism caused by
the al-Aqsa Intifada.
The State of Israel is also being sued, should the PA�s claim that Israel
violated its obligations under the Oslo Agreements be accepted. The claim
was filed through Adv. Benjamin Taub.
The suit by Caprice Jewellery and its three subsidiaries asserts that the PA
is responsible for the collapse of the tourism industry. Caprice Jewellery
claims it acquired the activity of three other companies on the basis of the
Oslo Agreements, under the assumption that the agreements would increase the
number of tourists entering Israel and sales would consequently rise.
The four companies reported sales of $40 million in 1999. Tourism grew 30%
in the first three quarters of 2000 before the Intifada broke out. They
claim that revenue in 2000 should have risen accordingly. When the Intifada
broke out, however, incoming tourism collapsed and the number of tourists
entering Israel plummeted 60%. Caprice Jewellery alleges its revenue dropped
accordingly by 59%.
Following losses and damages suffered by one of the subsidiaries, the
company, now under a creditors� arrangement, had to petition the Tel Aviv
District Court to delay its payments for the acquisition of the NDC�s
tourist business. The Tel Aviv District Court granted the petition and
postponed the payments by nine months.
Caprice Jewellery asserts that the Palestinians are fully responsible for
all its damages and losses since September 29, 2000. The company alleges
that under the Oslo Agreements, the PA pledged to refrain from all violence
against Israel and its citizens and prevent terror originating from its
Adv. Taub claims that legal norms establish that those responsible for
violent acts that cause damage to property, business, and revenue bear
responsibility for losses and must pay for them. The claim notes that damage
to tourism equals that during the Gulf War, following which Iraq was
required to pay damages to Israel concerns, including Israeli tourism
companies, hotels, and tourist guides. The damages were paid in recent
The Israel Hotel Association announced in Jerusalem it had asked Adv. Yehuda
Rave to file a NIS 200 million lawsuit against the PA for damages to
Jerusalem hotels caused by the Intifada. According to the Hotel Association,
non-religiously observant Israelis are not vacationing in the city and the
hotels are being patronized solely by the observant public.
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