Israel Passes Judicial Reform

Policy Brief Program

July 2023

The Judicial Vote:

• On July 24, the Knesset, Israel’s parliament, passed legislation that limits the judicial branch’s oversight on the government.
  • The bill is the first in a series of reforms to curb the powers of the judiciary.
  • With 120 total members in Knesset, the bill passed 64-0. Opposition members walked out on the vote, which they had little chance of winning.
• The bill blocks the Israeli judiciary from utilizing the “reasonableness” standard, which grants Israel’s High Court of Justice the authority to block unreasonable government decisions. 
  • The reasonableness standard was used as oversight when Netanyahu’s appointed key ally and convicted tax fraudster Aryeh Deri to two ministerial positions.
• The bill’s proponents claim that it will help restore the proper balance of power between the branches of government. 
  • Critics argue that the bill destabilizes Israel’s democracy and compromises the independence of Israel’s judiciary. 
• Due to mass dissent, Netanyahu suspended justice reform talk in late March; however, the conversation was renewed in early July.

Domestic and Regional Responses:

• Protestors flooded the streets of Israel in response to the bill’s passage, and economic and security implications are emerging. 
  • Tel Aviv’s stock market closed 2.3% lower than it was at the time of the vote. The shekel is at its lowest against the dollar since July 12, at 3.68 shekels to the dollar.
  • Israel’s main workers’ union, the Histadrut, declared that it will commence a general strike in protest of the reforms. 
  • Thousands of The Israel Defense Forces (IDf) reservists threatened not to show up for duty. 
• The White House referred to the reform as “unfortunate” and pledged to work with Israeli leaders, such as President Isaac Herzog, on reaching a consensus among the Israeli people. 
• While Middle Eastern media has reacted to Israel’s judicial reform, many believe the responses of neighboring states fall short of expectations.

Future Impacts:

• Some analysts suspect that Netanyahu is pursuing these reforms to escape ongoing prosecution and potential consequences for long-standing corruption and fraud charges against him. Netanyahu has denied these accusations. 
• The reforms have wide-ranging potential implications, analysts say, specifically in the West Bank, where Netanyahu’s far-right coalition may now be able to override the court’s efforts to restrict settlements. 
• Protests intensified after the bill’s passage on Monday. It remains to be seen how Israel’s industries and military will be impacted by threats of a strike made by private sector workers and military reservists.