In 2017, 36,354 businesses in Israel operated without a business license as required by law, one third of them in the food sector, according to a Ministry of the Interior report based on reports from 219 of the country's 257 local authorities. The businesses operating without licenses represent 27% of the total number of businesses in Israel that need to be licensed - 132,325. The report, details of which have reached "Globes", further shows that 29% of the businesses operating without a license in 2017 did not receive licenses because of failure to meet planning and building requirements. 25% did not meet Fire Service requirements, and 15% did not meet Ministry of Health requirements.
31% of the total number of businesses that operated without a license in 2017 belonged to the food sector. They amounted to 17,262 of the 55,153 businesses in this sector that year.
The Ministry of the Interior's figures indicate a decline in the number of unlicensed businesses. In 2013, 31% of businesses that required a license did not possess one. In 2015, the proportion fell to 29%, with a further 2% decline by 2017.
The Ministry of the Interior attributes the declining trend to the start of the reform in business licensing in 2017, which was aimed at substantially shortening the time taken for the procedures business owners have to complete in order to obtain a business license, after years in which these procedures represented one of the main barriers to opening a business. Many types of business were enabled to obtain licenses on the basis of declarations regarding lists of requirements from the various regulatory bodies, such as the police, the Ministry of Environmental Protection, the Ministry of Health, and so forth. The issue of licenses on the basis of declarations is accompanied by enforcement measures and sanctions for businesses found in breach of the requirements.
The second phase of the reform, which was meant to have come into force last month, and which included fast-track licensing for many businesses, was postponed because of the need to obtain approval from the Knesset Internal Affairs and Environment Committee, which became impossible because of the dissolution of the Knesset and the early election.
The businesses in the photograph are not connected to the article.
Published by Globes, Israel business news - en.globes.co.il - on May 27, 2019
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