- September 3, 2025
- 3:15 pm
- Israel
At the end of August 2025, the deadline given by the Jerusalem District Court to Russia to object to the seizure of its assets in Israel expired.
By the time of publication on 03.09.2025, the case was already on hold by order of the Supreme Court, and the entire country is watching the fate of the Sergei Palace Hotel and the HaMa’alot parking lot in central Jerusalem.
Seizure is possible, but only if these are commercial properties and the document delivery procedure is flawless. Currently, the process is suspended by the Supreme Court of Israel pending verification of the procedure.
Details were published by the Israeli Calcalist on September 3, 2025.
We have already written about the process itself – “Seize assets belonging to Russia” — a Ukrainian company filed a lawsuit in the Jerusalem court for compensation for assets seized by Russia in Ukrainian Crimea.
Root Cause: Russia’s Bloody Aggression
The origins of the case go back to 2014, when Russia forcibly annexed Crimea. This was accompanied by loss of life, massive human rights violations, and total expropriation of Ukrainian property. Among the affected was the company DTEK Krymenergo, whose assets were nationalized.
It was this bloody aggression and territorial seizure that led to arbitration in The Hague, where in January 2023, the arbitration ruled that Russia must pay Ukraine $207 million. Today, the dispute over the Sergei Palace Hotel and the HaMa’alot parking lot in Jerusalem is just one of the consequences of the unprovoked war that Moscow is waging against Ukraine.
Why Ukraine Came Here
In January 2023, arbitration in The Hague awarded the Ukrainian company PJSC DTEK Krymenergo $207 million in compensation for assets nationalized by Russia in Crimea after 2014. The enforcement stage then began in various jurisdictions, and Israel was among the possible destinations.
Objects Involved in the Case
Both objects legally belong to the Russian government.
Sergei Palace Hotel
A historic hotel on Heleni ha-Malka Street, a few hundred meters from the Old City. Built in the late 19th century for royal pilgrims and reopened after restoration in 2017. It is a commercial, not a diplomatic, property.
HaMa’alot Parking
A city parking lot at the King George — Ma’alot junction. It stood idle for years, was then renovated, and reopened about two years ago, highlighting its commercial nature.
Why “Commercial Status” Decides Everything
Under Israeli law on the immunity of foreign states, their property is usually protected from enforcement actions. But for “commercial property and real estate” in Israel, there is an exception, and this is the legal “gap” the plaintiff is targeting.
Timeline: Case Steps
Step 1 — Filing in District Court (Spring 2025)
The company DTEK Krymenergo, through attorney Zoar Lande (Barnea Jaffa Lande & Co.), asked the Jerusalem District Court to impose precautionary seizures on Sergei Palace Hotel and HaMa’alot. The court denied the “ex parte” seizure but ordered notification to the Russian Federation.
Step 2 — Document Delivery via Diplomacy (May 2025)
The court ordered the state to “promptly” deliver the documents. The Israeli Embassy in Moscow sent copies of requests and decisions to the Russian Foreign Ministry via diplomatic mail, as recorded in the materials.
Step 3 — Russia’s Response: “Procedure Violated”
The Russian side, in a diplomatic note, stated that the delivery did not comply with international law and the Hague Convention on Service, some documents were not properly translated, and the minimum response time should be 60 days after proper delivery of the full package. Russia also claimed it “is not a party to the process.”
Step 4 — Position of the State of Israel
The Foreign Ministry and the government’s legal advisor (Gali Baharav-Miara) warned: a procedural failure could harm foreign relations, and reciprocal measures against Israeli assets abroad are possible. This raised the “stakes” of the case to the level of state policy.
Step 5 — District Court Decisions (Summer 2025)
Judges Ilan Sela and Pnina Neuwirth rejected the arguments of the state and the Russian Federation. They stated: if the Russian government wants to object, it should contact the court directly, not through a diplomatic note. The court also set a deadline — by the end of August 2025, after which a decision will be made based on the materials already submitted.
“If the Russian government wishes to file objections to the procedure, let it contact the court directly… If no response is received by the end of August, a decision will be made based on the case materials.”
Step 6 — Appeal and Suspension in the Supreme Court
The Attorney General appealed to the Supreme Court to overturn the district court’s decisions and issue a suspension order. Judge Ruth Ronen suspended the proceedings in the district court pending determination of the proper delivery procedure. By the time of publication on 03.09.2025, this pause was already in effect.
Where the Case Stands Right Now
Stage: process “frozen” in the Supreme Court of Israel (BAGATZ). The Jerusalem District Court has halted consideration and is awaiting instructions from above. Now everything depends on the Supreme Court’s decision: whether it recognizes that the documents were properly delivered to Russia and whether it gives the green light to continue the case.
Arguments of the Parties — Briefly
- Ukraine (DTEK Krymenergo): there is arbitration for $207 million; it’s about commercial assets; the Russian Federation should object in court, not with notes.
- Russia: delivery not according to rules and without full translations; minimum response time — 60 days; “we are not a party to the process.”
- State of Israel: fears foreign policy damage and reciprocal measures; requests an ideal procedure before any seizures.
- Jerusalem District Court: “to court, not through diplomacy”; deadline — end of August 2025.
Why This Matters to the Israeli Reader
For the market, it’s a test of how the immunity exception for commercial real estate works. For politics, it’s an exam of the balance between law and foreign relations. For Jerusalem residents, it’s a question of how an international conflict affects real addresses between Jaffa Street and the Old City.
NAnovosti — Israel News: A View from the Middle
The editorial team of NAnovosti — Israel News notes: it is here that Israel, Ukraine, the diaspora, and the Jewish community intersect. “Israel News” ceases to be internal when a decision on two city objects can affect international arbitration enforcement practices.
What Will Happen Next: Realistic Scenarios
Scenario 1 — Return to District Court and Precautionary Measures
The Supreme Court upholds the district court’s decisions. In Jerusalem, precautionary seizures of Sergei Palace Hotel and HaMa’alot are reconsidered, and the question shifts to whether it is a “commercial asset.”
Scenario 2 — New Delivery Procedure
BAGATZ agrees with the Attorney General: the package needs to be delivered again according to all international rules. Then the Russian Federation gets a new 60-day window, and the case slows down for months.
Scenario 3 — Compromise
The court says: “the procedure is not ideal, but the plaintiff cannot be blocked.” The district court continues on the condition of repeated delivery and additional time for the Russian Federation. This is a “middle” path.
About Timelines (Estimated)
For cases with a diplomatic dimension, it is reasonable to expect the first hearing within 3–6 months and a decision a few months after the hearing. This is a forecast based on practice, not a fact from a source.
Quotes Setting the Tone
“The request for permission to appeal is based on important interests in Israel’s foreign relations… It is about preventing harm to diplomatic relations and reciprocal measures against Israel.” — from the Attorney General’s position to the Supreme Court.
“Assets of a foreign state have immunity from enforcement proceedings… however, commercial property or real estate in Israel does not receive diplomatic immunity.” — about the main exception in the law.
Reference on Objects
- Sergei Palace Hotel: restored and opened in 2017; located within walking distance of the Old City; historical heritage of the late 19th century.
- HaMa’alot: parking at King George — Ma’alot; renovated and reopened about two years ago; a city revenue-generating asset.
Conclusion: Where We Stand
Since the end of August 2025, the district court’s deadline for the Russian Federation has expired. By 03.09.2025, the process was already suspended by the Supreme Court (Judge Ruth Ronen) pending determination of the delivery procedure. Everything now depends on whether the courts recognize the commercial status of the assets and the propriety of the notification.
FAQ
FAQ
Why did everything “surface” at the beginning of September 2025?
Because by the end of August, the deadline set by the district court for the Russian Federation expired, and by the publication date of 03.09.2025, the Supreme Court suspension was already in effect.
What objects are at the center of the dispute and why are they suitable?
The Sergei Palace Hotel and the HaMa’alot parking lot — both objects are commercial and not diplomatic missions, which opens an exception to immunity.
What does Russia claim about the procedure?
That the delivery was not made according to the Hague Convention, translations are incomplete, and a minimum of 60 days is required after proper delivery of the full package.
What can the court decide next?
Three options: return to the district court and precautionary measures; complete re-procedure of delivery; compromise with conditions and additional time for the Russian Federation. The outcome will determine the fate of the seizure in Israel.
Conclusion: Which Path Will Israel Take?
The situation with Sergei Palace Hotel and the HaMa’alot parking lot is not just a dispute over two objects in Jerusalem. It is a test for Israel: will it follow the path of international law, enforcing arbitration decisions and supporting a predictable legal system, or will it prioritize diplomatic considerations and political pressure.
The Supreme Court’s decision will show whether the country is ready to uphold the rule of law even when it is painful for relations with Moscow. For Ukraine, it is a chance to prove that Russian aggression and property theft will not go unpunished. For Israel, it is an opportunity to confirm that Jerusalem remains a place where the law is above fear of powerful players.
Source of facts and dates: Calcalist publication (Hebrew), 06:00, 03.09.2025; decisions of judges Ilan Sela and Pnina Neuwirth on setting the deadline “by the end of August,” diplomatic delivery in May 2025, and temporary suspension by Judge Ruth Ronen.
