Itongadol.- As peace negotiations sputter between Israel and the Palestinians, the creation of an “economic” peace took a big step forward Monday with the launch of the Jerusalem Arbitration Center (JAC), a commercial dispute mechanism that is expected to help boost Israeli-Palestinian trade.
“Wherever there is more economy there are fewer rockets and shooting,” said Oren Shachor, Chairman of Israel’s branch of the International Chamber of Commerce, the organization that set up the JAC.
Until now, commercial disputes between Israelis and Palestinians were relegated to inefficient Oslo accord-era mechanisms. Israeli businesses could not be sure that court decisions would be enforced in Palestinian areas, while Palestinians were felt disadvantaged by Israeli law, especially when up against larger, more powerful businesses. Palestinian courts were generally hostile to Israelis, making them a poor alternative.
“There was not an arrangement, and most of the deals were done in cash money,” said Shachor. Because of the lacking legal mechanisms, businesses relied on cash on delivery and bank guarantees.
Because the new system will allow people to take their disputes to binding arbitration, it is expected to open the doors to other kinds of contracts, credit, and business arrangements.
“Trade between Palestinians and Israelis currently amounts to over US$4 billion each year, giving rise to thousands of cases of commercial disputes,” said ICC Chairman Harold McGraw. “The JAC will bring fair, expeditious and cost-efficient dispute resolution to the region and is expected to help rectify ties between Palestinian and Israeli business people, opening room for new markets, attracting local and foreign investments and bringing long-term benefits to the legal profession here.”
If, for example, a Palestinian believed he received faulty goods from and Israeli manufacturer—or vice versa—there was little effective recourse. The JAC, on the other hand, will be recognized by judicial authorities, legally coordinated, and enforceable on both sides.