Does Operating a Kibbutz Swimming Pool Require a Business License?

Summer has arrived, bringing the start of peak swimming-pool season. Apart from hotel and country-club pools, kibbutz pools are the most popular. Most kibbutzim have swimming pools, used not only by residents and for classes and activities, but also as an attraction for guests staying in the kibbutz’s holiday accommodation and sometimes by paying outside visitors.
Does operating such a kibbutz pool require a business license? Must the kibbutz and the pool operators therefore comply with Ministry of Health sanitation regulations? Can noncompliance lead to criminal prosecution? These questions recently received surprising answers from the Haifa Magistrates’ Court: operating a kibbutz pool does not necessarily require a business license, and it therefore acquitted the defendants.
Over the past year, the Ministry of Health pursued criminal proceedings against Kibbutz Ramat Yohanan in the Zevulun Regional Council in northern Israel and against its pool operator. The ministry argued that kibbutz pools require a business license and that inspections at Ramat Yohanan revealed sanitation deficiencies. An indictment was therefore filed for operating a business without a license and several other violations of swimming-pool sanitation regulations. The defendants denied the charges, arguing that although the pool had no business license, it did not need one because it was a kibbutz swimming pool.
Judge Dr. Zaid Falah relied on several earlier rulings holding that a kibbutz pool cannot be regarded as a “place of business” and that a kibbutz is, by definition, not a place open to the general public. The facts showed that the Ramat Yohanan pool charged no admission and served kibbutz residents and any guests they brought, rather than the general public. It therefore lacked the characteristics of a business. Judge Falah added that no commercial characteristic was evident in its operation, although charging admission could constitute such a characteristic. Since all charges against the kibbutz and pool manager rested on business licensing, and the pool was found not to require such licensing, the court acquitted the defendants on every count.
Whether a kibbutz requires a business license for its swimming pool depends on the circumstances. The judgment set out the criteria: charging admission, limiting access to people with a genuine connection to the kibbutz, and the number of visitors during peak periods. Each kibbutz should assess itself against these criteria and consult professionals instead of waiting for a Ministry of Health inspection.
Author: Adv. Uri Shiloh, founding partner at A. Shiloh & Co., specializing in real estate and planning and construction. He did not represent a party in this case.