Israeli Competition Authority Warns Against Informal Bank Chair Meetings Amid Monopoly Crackdown

Yael Sheinin, the outgoing legal advisor of Israel's Competition Authority, expressed serious concerns about informal communications between bank chairpersons, highlighting that such private WhatsApp messages can foster illegal collusion. Her remarks came after a leaked exchange between top Israeli bank chairs discussing a meeting, which prompted the authority to demand all related correspondence. Sheinin, who has led the authority's legal team for five years, emphasized that competitors must communicate only through formal, documented channels with legal oversight to prevent anti-competitive behavior.

Sheinin also reflected on her tenure overseeing investigations into major corporate cartels, including a landmark case against Victory supermarket chain owner Eyal Rabid for price-fixing in the food market. She noted that cartel coordination methods have evolved from signed contracts to emails, WhatsApp, and even public statements, requiring the authority to adapt its enforcement strategies. Israel is among few countries enforcing criminal penalties for competition violations, with potential prison sentences for offenders.

The authority is currently scrutinizing about 300 merger requests annually, often focusing on concerns over data sharing and market dominance. A notable pending case involves the Union Group and Harel Insurance's proposed acquisition of credit card company CAL, raising fears that consumer data could be exploited to stifle competition in pharmacy retail. Sheinin explained that information has become a critical asset in mergers, sometimes more valuable than physical products.

Sheinin also addressed the authority's recent designation of Israel's five largest banks as a "concentration group" to impose stricter regulations on deposit and credit services, a move opposed by the Bank of Israel. Additionally, the authority imposed hefty fines on El Al Airlines for excessive pricing during wartime and monopolistic practices restricting competitor access to maintenance hangars.

Despite criticism that the authority rarely declares monopolies, Sheinin defended the approach, calling such declarations a limited tool and emphasizing the authority's broader enforcement powers. She plans to take a break to complete her doctorate and spend more time with her family after an intense period combating anti-competitive practices in Israel's economy.