EU split over Israeli settlement trade ban as foreign ministers fail to reach majority for action

A divided council

EU foreign ministers met in Brussels on Monday for what was the first Foreign Affairs Council under Ireland’s EU presidency. Banning trade with illegal Israeli settlements in the occupied West Bank was one of several key issues discussed. The bloc’s foreign policy chief, Kaja Kallas, said afterward that the trade ban option had “got the most support” from member states, but acknowledged that it fell short of the simple majority required to force the European Commission to table a concrete proposal.

Taking measures against trade with the settlements gained the broadest support from member states.

“Everybody agrees that the situation in the West Bank is really intolerable,” Kallas said, adding that settlement expansion is “making it more and more impossible that the two-state solution can ever come into effect.” The discussion exposed deep rifts within the 27-member bloc, both between member states and between EU institutions.

The procedural quagmire

At the heart of the impasse is a dispute over whether a settlement trade ban should be classed as a foreign policy measure (requiring unanimous approval from all 27 member states) or a trade measure (requiring only a qualified majority of 15 states representing 65 percent of the EU population). The European Commission has signalled it views the ban as pursuing a “foreign policy objective,” implying unanimous backing would be required.

Critics note that Commission President Ursula von der Leyen previously supported taking more foreign policy decisions by qualified majority, and last year the Commission repeatedly argued that suspending the EU-Israel free trade deal required only a qualified majority. Some diplomats have accused the Commission, and von der Leyen in particular, of dragging its feet. Several member states, including Ireland, Spain, the Netherlands, and Belgium, already impose their own restrictions on settlement goods.

Member state fault lines

Germany and Italy are reported to be undecided or blocking the proposal. German Foreign Minister Johann Wadephul said in Brussels that settlement policy contradicts international law and that he had made this "clear" to the Israeli government during a recent visit to Tel Aviv. But Germany, along with other states, holds that strong measures can only be adopted unanimously. The Czech Republic is reported to oppose firm action outright.

We are calling for concrete proposals.

Belgium’s foreign minister said the options presented by the Commission appeared to be more “a bone to gnaw on than a genuine desire to move forward.” Irish Foreign Minister Helen McEntee expressed support for a “full ban on trade in the occupied territories” and said she hopes to enact domestic legislation to that effect by the end of next week.

Next steps

The issue has been passed to EU ambassadors to press forward with potential action, and Kallas said an extraordinary meeting on the matter would likely be held. Even if the Commission does come forward with a proposal, a ban is not guaranteed. Israel occupies the West Bank since 1967; more than 500,000 Israeli settlers live in the territory, excluding East Jerusalem, alongside some three million Palestinians. Trade with the settlements represents less than 1 percent of total EU-Israel trade, according to the EU.

Broader sanctions context

The same Foreign Affairs Council meeting also failed to reach agreement on a new package of Russia sanctions. Kallas expressed regret, saying the bloc was “quite close” to a deal. Diplomats said Greek efforts to protect domestic shipping companies involved in LNG transport to third countries were among the obstacles. The planned package would suspend a routine adjustment of the oil price cap, which must otherwise be raised by 15 July due to higher global prices linked to the Iran war and the partial blockade of the Strait of Hormuz.