This is the Covenant made this day in Jerusalem between the State of Israel, represented for this purpose by the minister of finance, and Keren Kayemeth LeIsrael - with the sanction of the World Zionist Organization - represented for this purpose by the chairman of the board of directors of Keren Kayemeth LeIsrael.
Since its inception more than half a century ago, Keren Kayemeth LeIsrael has been engaged in acquiring land in Palestine and transferring it to the ownership of the people, reclaiming and afforesting land, leasing out land for settlement and housing, and administering its lands. The fundamental principle of Keren Kayemeth LeIsrael is that its lands shall not be sold, but shall remain the property of the people and shall be given on lease only.
After the establishment of the State, the volume of the acquisition of land by Keren Kayemeth LeIsrael from non-Jewish owners has decreased, while the extent of the redemption of land from desolation has steadily increased. The State has become the owner of most of the land in Israel, and the Government administers and develops these domains.
The Government of Israel and Keren Kayemeth LeIsrael have resolved to end the duplication resulting from the administration of their lands by different agencies, to concentrate the administration, conservation and care of these lands in the hands of the State and to strengthen the hands of Keren Kayemeth LeIsrael in fulfilling its mission of redeeming land from desolation.
The parties to this Covenant have therefore agreed as follows:
1. Upon the coming into force of the Basic Law: Israel Lands (hereinafter referred to as "the Law"), the administration of the lands which are State land or land of the Development Authority or land of Keren Kayemeth LeIsrael, whether acquired in the past or to be acquired in the future, shall be concentrated in the hands of the State.
2. The Government shall establish an "Israel Lands Administration" (hereinafter referred to as "the Administration") and shall, after consultation with Keren Kayemeth LeIsrael, appoint a Director to head the Administration. The Director shall be subordinate to the Minister charged by the Government with the implementation of this Covenant (hereinafter referred to as "the Minister").
3. Notwithstanding the provision of clause 1, there shall be no change in the ownership of the lands as registered in the Land Registry, save to the extent that the parties to this Covenant agree, in respect of particular lands, to register them in the name of the State or in the name of Keren Layemeth LeIsrael, either by way of exchange or in any other manner.
4. Israel lands shall be administered in accordance with the Law, that is to say, on the principle that land is not sold, but only given on lease, and in accordance with the land policy laid down by the Board established under clause 9. The Board shall lay down a land policy with a view to increasing the absorptive capacity of the land and preventing the concentration of lands in the hands of individuals. The lands of Keren Kayemeth LeIsrael shall, moreover, be administered subject to the Memorandum and Articles of Association of Keren Kayemeth LeIsrael.
5. Where the Administration, in respect of a particular transaction, deems in necessary to deviate, in one or the other detail, from the principles of the land policy referred to in clause 4, such transaction shall only be made with the approval of the Board established under clause 9 and, where land registered in the name of Keren Kayemeth is concerned, with the consent of Keren Kayemeth LeIsrael or, where other Israel land is concerned, with the consent of the Minister.
6. Any transaction in respect of Israel land shall be entered into by the Administration on behalf of and as the agent of the registered owner of such land, and any proceeds of Israel land shall be the property of the registered owner; and the State accepts, in consideration of this Covenant, to bear the expenses of the Administration.
7. The Administration shall deliver to the registered owners of Israel land, once every three months (and for the first time of the expiration of six months from the day of the coming into force of the Law), a report of the income and expenditure of the administration of their land. The expenditure shall include a fixed amount determined by the Administration, either as a certain percentage of the income or as a quota on a certain unit of measurement of the land. Upon the delivery of such a report, any balance appearing therein to the credit of Keren Kayemeth LeIsrael shall be regarded as a debt due to it and payable by the State, and any balance appearing therein to the debit of Keren Kayemeth LeIsrael shall be regarded as a debt due from it and payable to the State.
8. The Administration shall deliver to the Government and to Keren Kayemeth LeIsrael, once a year, a report of all its activities.
9. The Government shall establish a Board, under the chairmanship of the Minister, which shall lay down the land policy, approve the budget proposal of the Administration and supervise of the activities of the Administration and the manner in which this Covenant is carried into effect. The number of the members of the Board shall be thirteen; half of them, less one, shall be appointed upon the proposal of Keren Kayemeth LeIsrael. The members of the Board may be replaced in the same way as they were appointed. Notice of the appointment of the Board and of the names of its members, as appointed from time to time, shall be published in Reshumot.
10. The reclamation and afforestation of Israel lands shall be concentrated in the hands of Keren Kayemeth LeIsrael, which shall establish a "Land Development Administration" (hereinafter referred to as "the Development Administration") for that purpose. Keren Kayemeth LeIsrael shall, after consultation with the Minister, appoint a Director to head the Development Administration, who shall be subordinate to Keren Kayemeth LeIsrael.
11. The Development Administration shall draw up once a year (and for the first time at the expiration of three months from the day of the coming into force of the Law) a scheme for the development and afforestation of Israel lands, and shall submit that scheme to the Government and to Keren Kayemeth LeIsrael. The scheme shall be drawn up in complete coordination with the Minister of Agriculture.
12. The Afforestation Section of the Ministry of Agriculture shall henceforth engage in afforestation research only. However, the Minister of Agriculture shall continue to be charged with the implementation of the Forestry Ordinance, 1926, through the Development Administration.
13. The Development Administration shall engage in operations of reclamation, development and afforestation of Israel lands as the agent of the registered owners; and Keren Kayemeth accepts in consideration of this Covenant to bear the administrative expenses of the Development Administration.
14. The expenditure involved in operations of reclamation, development and afforestation of Israel lands shall fall on the registered owners of the lands on which the operation is carried out; and the Development Administration shall deliver once every six months (and for the first time at the expiration of nine months from the day of the coming into force of the Law) a report to the registered owners of expenditure as aforesaid incurred in respect of their lands. Upon the delivery of a report as aforesaid, any balance appearing therein to the debit of the State or the Development Authority shall be regarded as a debt due from them and payable to Keren Kayemeth LeIsrael. Where the Government requests the Development Administration to carry out operations of reclamation, development or afforestation of land registered in the name of Keren Kayemeth LeIsrael, and Keren Kayemeth LeIsrael notifies the government, in writing, before carrying out the operation, that it is unable to carry it out at its expense, the State shall bear the expenditure involved in the operation, and the amount thereof shall be paid to Keren Kayemeth either by a grant, loan or exchange of property or in any other manner, as may be agreed upon between the Government and Keren Kayemeth LeIsrael.
15. The Board for Land Reclamation and Development attached to Keren Kayemeth LeIsrael shall lay down the development policy in accordance with the agricultural development scheme of the Minister of Agriculture, shall approve the budget proposal of the Development Administration, and shall supervise the activities of the Development Administration and the manner in which it carries this Covenant into effect. The number of the members of the Board shall be thirteen; half of them, less one, shall be appointed by the Government. The members of the Board may be replaced in the same way as they were appointed. The Board shall be headed by the Chairman of the Board of Directors of Keren Kayemeth LeIsrael or a person appointed in that behalf by Keren Kayemeth LeIsrael.
16. Keren Kayemeth LeIsrael shall continue to operate, as an independent agency of the World Zionist Organization, among the Jewish public in Israel and the Diaspora, raising funds for the redemption of land from desolation and conducting informational and Zionist-Israel educational activities; and the Government shall extend assistance to Keren Kayemeth LeIsrael in informational and propaganda activities in Israel and abroad.
17. This Covenant shall come into force on the day of the coming into force of the Law and shall remain in force for five years. Unless one of the parties to this Covenant, at least six months before the expiration of the five years, announces its intention not to renew it, its validity shall be automatically extended for another five years; and so on indefinitely from five-year period to five-year period.
18. If the Law is repealed or amended, Keren Kayemeth LeIsrael may withdraw from this Covenant by giving notice of withdrawal, in writing, to the Government; however, Keren Kayemeth LeIsrael may not withdraw from this Covenant if the Government notified it in advance, in writing, of the proposed amendment of repeal, and Keren Kayemeth LeIsrael did not express opposition.
19. If this Covenant becomes void, whether by virtue of clause 17 or by virtue of clause 18, the position which existed immediately before the coming into force of the Law shall be restored; the Government undertakes to propose the necessary legislation to the Knesset.
20. If one of the parties to this Covenant considers that a change should be made therein, it shall give written notice to the other party, which shall reply to the proposal, favorably or unfavorably, within six months from the day on which notice is given. If the reply is favorable, the Covenant shall be deemed amended, in accordance with the proposal received from the day on which the reply is given.
21. From the day of the signing of this Covenant, the parties thereto shall do everything necessary and expedient for the implementation thereof and shall be bound by it in all respects.
IN WITNESS WHEREOF THERE HAVE HEREUNTO SET THEIR SIGNATURES, on behalf of the State of Israel, the Minister of Finance, Mr. Levi Eshkol, and on behalf of Keren Kayemeth LeIsrael, the Chairman of the Board of Directors thereof, Mr. Jacob Tsur, in Jerusalem, this 20th day of Kislev, 5722 (28th November, 1961).
Minister of Finance
Chairman of the Board of Directors
Keren Kayemeth LeIsrael
* The text of this translation is not binding, the only authentic text being the Hebrew original