Israeli Court Ends Years-Long Delay in Smart ID Card Tender Process
For nearly two decades, a single supplier has produced Israel's biometric smart ID cards for the Population and Immigration Authority without a competitive tender. Following investigative reports exposing issues with this arrangement and allegations by printing company Dfus Bari that the authority intended to extend the sole supplier's contract without competition, the Jerusalem District Court has now intervened. Judge Tamar Bar-Asher ruled decisively in favor of Dfus Bari, ordering the authority to adhere to a strict timeline to advance the tender process, which had been repeatedly delayed and obstructed.
The court set a schedule requiring the tender process to begin by mid-August 2026, with production of the new ID cards slated to start by June 2027. The judge condemned the authority's conduct as a "continuous failure," noting that for years the entire production and mailing of biometric ID cards was handled by one company and its affiliates without any tender, at a cost exceeding one billion shekels. The ruling also mandated the Population Authority to pay 25,000 shekels in legal fees to Dfus Bari.
The background of the case dates to February 2025, when the Population Authority sought to extend its contract with Petakit, the sole supplier since 2008, for an additional ten years and 240 million shekels without a tender. Dfus Bari, which claims it can produce the cards more efficiently and at lower cost, challenged this decision and demanded a competitive tender. After the authority announced a tender, Dfus Bari alleged it was tailored to exclude them, favoring Petakit. Subsequently, the tender was canceled in March 2026 due to "lack of readiness," prompting Dfus Bari to file a lawsuit.
The court criticized the authority for repeatedly delaying the tender and extending the sole supplier's contract, which has now lasted 18 years. The Population Authority plans to transfer responsibility for the project to the Government Printer, a unit of the Ministry of Finance, which will oversee the tender and production going forward. The judge emphasized that the state must conduct public tenders transparently and fairly, and that the prolonged exemption from tender violated these principles. The ruling requires the authority to meet the new deadlines despite the need for exceptional efforts to rectify the longstanding mismanagement.
