Israel’s Tax Authority and the National Insurance Institute (NII) have asked the court to reconvene a Clubmarket Marketing Chains’ creditors meeting to approve necessary changes.

The agencies, according to a report in Globes, also want the court to consider appointing an additional trustee for the company, “following the failure of negotiations with Clubmarket’s current trustees, Adv. Shlomo Ness and Gabi Trablissi, CPA.”

The two agencies allege that the trustees carried out a successful marketing and media ploy, and blamed them for the failure of a settlement. “The trustees came to the negotiating table with uncompromising positions, and when progress had been made between the parties, the government agencies encountered another obstacle in the form of an auditor’s committee,” the report says. The Tax Authority and NII claim they had agreed to collect only 30% of Clubmarket’s VAT liability on inputs –ILS14m (US$3.01m). This is more than 20% less than the amount paid to other creditors. When the offer was rejected, the Tax Authority and NII proposed that ILS 18m (US$3.87m) be set aside for legal proceedings concerning the tax liability on inputs. The two agencies claim that this proposal was also rejected by the trustees.

Last month,  Tel Aviv District Court Judge Varda Alshech warned that unless a settlement was reached with the Tax Authority and NII, “there would be no choice but to liquidate Clubmarket.”