Cybersecurity company Wiz Joins Private Sector Opposition Against Israeli Government’s Judicial Overhaul

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Israeli cybersecurity firm, Wiz, is reportedly transferring tens of millions of dollars out of Israeli banks, according to a source close to the company. This move is in line with the opposition of private sector against the government’s planned overhaul of the judicial system.

Wiz, valued at $6 billion, is concerned about the growing uncertainty in the Israeli market due to the proposed changes. Despite this, the company will keep its operations in Israel.

This move follows similar action by local venture capital fund Disruptive AI and Papaya Global, a payments platform unicorn, which announced their intention to move bank accounts out of Israel last month. The proposed judicial overhaul, yet to be written into law, aims to tighten political control over judicial appointments and limit the powers of the Supreme Court to overturn government decisions or Knesset laws.

However, the tech executives and economists have raised their concerns about the reforms, claiming that it would harm democracy, politicize the judiciary and compromise its independence. S&P Global Ratings has stated that the judicial shake-up could negatively impact Israel’s sovereign credit rating and dozens of economists have urged Prime Minister Benjamin Netanyahu to scrap the plan.

HSBC has also expressed its concerns, stating that the judicial reform could hurt the shekel given outflows after the currency had benefited from massive foreign inflows in the past few years. JP Morgan has compared the situation in Israel to that of judicial reforms in Poland in 2015, stating that the impact on the economy and markets is difficult to judge at this stage but could be a medium-term negative.

The opposition to the proposed judicial overhaul by private sector companies is a clear indication of the growing concerns about its impact on the economy and the country’s institutional framework. The tech industry in Israel has thrived over the decades and the strong democracy and judicial system have been its strongest support. The weakening of these institutions could have a negative impact on foreign direct investment and the country’s sovereign credit rating.

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