The Knesset early Tuesday morning passed final approval for legislation expanding the role of rabbinical courts, permitting them to handle civil and financial disputes through arbitration, provided both parties explicitly agree.

The measure was approved in its second and third readings with 65 lawmakers voting in favor and 41 opposing it.

Under the new law, state rabbinical courts will be allowed to serve as arbitrators in monetary and civil matters, restoring a framework similar to what had been in place until 2006. That year, the Supreme Court ruled that rabbinical courts could not rule on civil cases beyond their defined religious authority.

Following that decision, rabbinical courts were barred from hearing such disputes even in cases where both sides voluntarily sought their involvement.

Supporters of the legislation emphasized that the authority granted is limited and conditional. Rabbinical courts may only take on cases where both parties consent, and only after a dispute has already emerged, rather than through prior agreements covering potential future disagreements.

Knesset Constitution, Law and Justice Committee Chairman MK Simcha Rothman praised the passage of the bill, calling it a straightforward and fair proposal.

“This is a simple and straightforward proposal that should have been accepted by everyone, because nothing is more liberal than this – allowing two consenting adults to decide they want their dispute resolved according to Torah law.”