Israel's Ministerial Committee on the Cost of Living will meet later today to approve the decision to recognize EU regulation to allow the Israeli market to fully open to food and toiletries from Europe. Israel's unique bureaucracy and regulation currently blocks imports of many of these items.
French food chain Carrefour entered the Israeli market earlier this year on the understanding that it would be able to import the huge range of private label brands that it produces, which are sometimes far cheaper than the corresponding Israeli brands.
In practice, according to sources familiar with the matter, it is still only able to import 500 of the 5,000 products it produces as private label goods. This is due to gaps that still exist between Israeli and European regulation. Many times these are very small differences, such as whether the list of ingredients should be according before or after cooking, but even the smallest difference in regulation means a complete import ban for those products. According to the same sources, "There is no such thing as adopting 90% of European standards. Either you adopt all of it and you can import, or you don't and you can't."
Harmonizing Israeli and European regulation
This is one of the reasons why the Ministry of Health's approach to the issue of imports is being rejected. According to the Ministry of Health, the Israeli regulation must be "harmonized" with EU regulation, while keeping Israeli regulation separate. But in the eyes of the Ministry of Finance and the Ministry of Economy and Industry, this is an insufficient move that would continue to block many products, while not responding swiftly enough to the rising cost of living.
The position of the Ministry of Finance and the Ministry of Economy and Industry is to almost automatically allow the import of products marketed in Europe, even before the process of adjusting Israeli regulation is completed. This is according to the "Cassis de Dijon" ruling accepted in Europe, which already decided back in the 1970s that imported products from Europe would be subject to the regulation of the country of manufacture only, and would not have to comply with that of the importing country.
To decide between the positions, Prime Minister Benjamin Netanyahu last week convened the Ministerial Committee on the Cost of Living. While no decision was reached last week, a decision is expected today. According to sources familiar with the matter, the Committee and the Prime Minister will accept the position of the Ministry of Finance and the Ministry of Economy and Industry, and approve the adoption of EU standards for products marketed in Europe.
Published by Globes, Israel business news - en.globes.co.il - on September 12, 2023.
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