Divisions among EU Members to Ban Trade with Israeli Settlements in West Bank

IQNA – The European Union is considering new restrictions on trade with Israeli settlements in the occupied Palestinian territories, but disagreements over both the substance and legal foundation of such measures continue to divide member states.

News ID: 3498199

Date: 11 July 2026 - 11:17

A document circulated by the European Commission outlines several possible steps, including a complete or limited ban on settlement goods, higher customs duties, and a requirement for export licences.

EU foreign ministers are expected to examine the document during their meeting on Monday, although officials stressed that the paper does not amount to a formal legislative proposal.

Twenty member states had previously asked the Commission to clarify what trade measures could be taken against settlements, which are considered illegal under international law. The request was later reflected in the conclusions of the latest European Council summit.

Despite the lack of agreement, some governments have welcomed the fact that the issue is now formally under consideration.

"There is no consensus on this," an EU diplomat told Euronews on condition of anonymity. "But we are already happy that it is there."

France and Sweden have publicly supported tighter restrictions on settlement trade, while Germany and the Czech Republic remain more reluctant, amid concerns over the impact on relations with the Israeli regime.

"Italy has said several times they are open to exploring potential options," a second diplomatic source said.

Prime Minister Giorgia Meloni’s government has traditionally maintained close ties with Israel, but Rome’s position has appeared less firm in recent months amid domestic criticism and growing tensions with Israeli far-right minister Itamar Ben-Gvir.

Italy’s Permanent Representation to the EU said it would not comment while the government continues to assess the Commission document.

A central issue is whether any eventual measure would be treated primarily as a trade policy decision or as a foreign policy action.

Measures adopted under the EU’s common commercial policy can pass through qualified majority voting. Foreign policy decisions, however, generally require the unanimous support of all 27 member states.

The Commission has previously argued that restrictions on settlement trade should fall under foreign policy. The latest paper, however, does not settle the matter and says the appropriate legal basis would depend on the "center of gravity" of the final proposal, in accordance with EU case law.

Deputy Chief Spokesperson Olof Gill declined to say whether this language represented a change in the Commission’s position.

The Council’s legal service has reportedly told member states that a commercial-policy basis could be legally defensible, depending on the precise design of the measure.

The EU’s diplomatic service has also supported a broader interpretation of the treaties, arguing that trade instruments could be used to advance the bloc’s wider foreign policy goals.

"We have transmitted the paper to our member states, as we committed to doing. It will be discussed at the FAC [Foreign Affairs Council] on Monday, and we will take stock of that discussion and then see what happens from there," Gill said.

Officials and lawmakers cautioned that the Commission document represents only a list of possible measures and that a formal proposal remains distant.

Although EU governments could decide to advance the issue through different Council configurations, further discussion among foreign ministers is expected. The next scheduled formal Foreign Affairs Council meeting after Monday is not due until October.

"At least the options are on the table now, but this will be yet another delay," Italian MEP Lucia Annunziata said, accusing the Commission of obstructing progress, particularly through its handling of the legal basis.

The Israeli regime rejects the international legal consensus that its settlements in the occupied Palestinian territories are illegal, instead describing them as "temporary sites". It has also introduced additional measures aimed at entrenching its control over the occupied West Bank and eastern al-Quds.

The issue is gaining additional political significance ahead of Israeli elections scheduled for October. Several EU governments reportedly believe the latest steps in the occupied Palestinian territories are partly linked to the electoral campaign.

"Every decision must be assessed not only on its political message, but on whether it actually improves the situation on the ground, avoids unintended consequences for civilians, and preserves the EU’s ability to play a constructive role in the region," German MEP Hildegard Bentele said.

Source: Euronews