Members of the Israeli kibbutz Hanita, located near the northern border of occupied Palestine, are demanding $11 million from Bale Vision , the Chinese fund that controls 80 percent of the Hanita lens factory.

The plaintiffs also accused the company of refusing to exercise the option to purchase the remaining shares of the kibbutz, according to a lawsuit filed in the Tel Aviv court.

In a response letter attached to the lawsuit, the Chinese fund stated that Beijing classified “Israel” as a “high-risk zone” (red category) from the beginning of the war against the Gaza Strip, and imposed a ban on any new investment by the Asian country in the occupying entity, which makes it impossible to exercise this option.

“As long as this restriction is in place, there is no practical possibility of exercising this option,” the fund added.

According to the lawsuit, the kibbutz sold 74 percent of Hanita Lenses — a company specializing in the manufacture of intraocular lenses for medical use — to Bale Vision in 2021 for $35 million.

Of this amount, $25 million was paid to the kibbutz members, in addition to another $10 million that was invested in the company.

As part of the agreements, the Chinese fund gave the remaining minority shareholders the option to force it to buy their shares for approximately $9.5 million, currently valued at about $11 million, before early December 2025.

The kibbutz alleged that its stake was further reduced in two subsequent agreements signed in 2022, allowing the Chinese fund to own approximately 80 percent of the property.

One of the reductions came after an additional investment of seven million dollars, while another reduction was linked to a future investment of eight million that has not yet been executed.

In December, the kibbutz notified the fund of its intention to exercise its option. The claim stated that the remuneration was urgently needed due to the war.

Furthermore, he argued that he had been excluded from the management of the company and from the board of directors, which was centrally controlled by representatives of the Chinese owner, without holding any meetings.

However, the fund cited two reasons for declining to proceed: severe operating losses and what it described as the Chinese government’s ban on investing in " Israel " since the war.

Million-dollar losses for Bale Vision

In a letter dated December, Bale Vision director and interim CEO of the factory, Liu Yuxiao , wrote that the company had accumulated operating losses of approximately $15 million over three years and bank debts of about $4 million, leaving it in serious financial difficulty by early 2025.

Yuxiao indicated that he took over as CEO in March 2025 in an attempt to avoid bankruptcy, and the company was now on track to reach operating break-even this year.

However, he argued that discussions about this option were premature and could jeopardize the fragile recovery.

He again pointed to political restrictions, stating that limitations imposed by the Chinese government forced the fund to rely on loans from shareholders rather than injecting new capital, which limited its ability to finance the venture.