c. 2005 Religion News Service

VATICAN CITY _ Forty years ago, the Vatican issued Nostra Aetate, in which the church officially ceased blaming Jews for the death of Jesus. Since then, acts of reconciliation have come to define relations between the Holy See and Israel.

Full diplomatic relations were established, a regretful John Paul II visited the Western Wall and his successor, Benedict XVI, entered a Jewish synagogue in his native Germany last summer.

Until this week, one issue appeared stalemated: the Vatican’s rights to property and tax exemption in the Holy Land. The subject received “particular attention” when Israeli President Moshe Katsav visited Pope Benedict XVI on Thursday (Nov. 17).

Speaking to a press conference following the visit, Katsav said he promised Vatican Secretary of State Cardinal Angelo Sodano that “an effort would be made to accelerate the (negotiations) and respond positively to the requests of the Catholic Church.”

“Most of the issues are almost settled. Very few remain open” to further negotiation, Katsav said, pledging to reach a solution “as soon as possible.”

Since the creation of the state of Israel in 1947, a vast sea of Vatican property ranging from holy shrines to modern hospitals has languished in legal and fiscal limbo. Out of respect for Catholicism’s deep roots in the Holy Land, Israeli officials have generally granted tax exemptions to Catholic properties. But in recent years, local and regional governments have begun pressing for back taxes on Catholic hospitals and other nonchurch properties going back nearly 60 years.

Under current Israeli laws, the church has no access to judicial courts when land ownership disputes occur and is not guaranteed the tax exemptions the Vatican and other religious institutions routinely receive in other countries.

David Jaeger, an Israeli lawyer and legal expert on Vatican holdings in the Holy Land, indicated the property stalemate has thrown a wrench in Israel-Vatican relations. “I don’t know of any other issue,” he said. “It’s the whole issue because everything else derives from it and depends on it.”

Jaeger was the Vatican’s lead negotiator on the 1993 Fundamental Agreement, the Vatican-Israeli accord that set the stage for the establishment of full diplomatic relations between the two states in the spring of 1994.

As part of that agreement, Israel pledged to swiftly regularize the legal status of church activities within its borders _ a pledge that has languished for more than a decade as Israel turned its attention to more pressing matters, such as suppressing the Palestinian uprising.

According to Oden Ben-Hur, Israel’s ambassador to the Holy See, the Israeli government is now eager to move beyond the dispute, making “serious and painstaking efforts” to find a solution.

“There is now serious involvement at the highest political level possible,” he said, adding that Prime Minister Ariel Sharon has given “specific instructions” to resolve the dispute while Katsav, Israel’s ceremonial head of state, had been “doing everything possible to tie up loose ends” in preparation for his visit with Benedict.

“We are very close to the conclusion,” Ben Hur said in an interview. “The promises are in the future and the future is not that far away.”

Current negotiations, which resumed in July 2004 after stalling in August 2003, aim to reach a written accord that establishes the Holy See’s official status as a major land-owner in Israel.

At issue in the impasse is whether Israel can adhere to international treaties that effectively challenge the status quo of its legal system.

“We have one major dispute or remaining obstacle, and that is whether this accord, once reached, should be inserted in Israeli law,” Ben Hur said.

Allowing judicial courts to review Vatican land disputes would represent a departure from current Israeli law, which considers religious properties the jurisdiction of the executive branch of government. As a result, government-appointed panels typically preside over ownership disputes rather than judicial courts.

Granting the Vatican permanent tax exemptions, meanwhile, could unleash a ripple effect among other nonprofit and religious groups present in the Holy Land, demanding equal status.

“If the Catholics get this deal, the Muslims, the Baptists and everyone else operating in (Israel) will want it,” said John Allen Jr., a longtime Vatican analyst and author.

Pressure to fulfill the Fundamental Agreement has been mounting recently as local and regional governments in Israel have begun to ask for back taxes from Catholic institutions such as hospitals and pilgrimage centers.

In June, a case involving the tax status of a pilgrimage center on the Sea of Galilee went before Israel’s High Court of Justice, after regional authorities pressed the center for back taxes.

When the center invoked the Fundamental Agreement to justify its refusal to pay, the national government told regional authorities that the accord was not yet binding in Israeli law.

The Vatican argues that its right to tax exemption was established centuries ago, recognized under the Ottoman Empire and reflected in United Nations Resolution 181, which effectively created Israel in 1947. According to the resolution, religious properties that had been tax exempt before the resolution should remain so.

“When the state of Israel was created the Catholic Church was already there with its rights, with its freedoms and with its property,” Jaeger said.

KRE/JL END RNS

Editors: This is an updated version of RNS-CATHISRAEL-LAND, transmitted Tuesday, Nov. 15. This story incorporates developments from Thursday’s Vatican meeting.