The Israeli parliament has given the greenlight to the launch of a third free-to-air terrestrial channel in a bid to increase competition in the Israeli television market.

According to new legislation, the Third Channel will be operated by two companies. Israel's only existing commercial broadcaster, the Second Channel, is currently operated by three.

Companies bidding to operate the channel must not control more than 10% of any other sector of the media, according to the new law. Israel's two leading daily newspapers - Yedioth Achronoth and Maariv - are both involved in the Second Channel along with financial groups with large holdings in terrestrial cable.

The channel is expected to start broadcasting between April and July 2001. It will be required to operate its own news service, not later than one year after launch, and domestic productions must comprise at least 40% of its programming. Israel's production community warmly welcomed this clause.

Less pleased are the three partners operating the Second Channel which claim the local market is too small to support two commercial broadcasters.