A new sanctions regime: targeting Israel’s West Bank settlements

International responses to Israel's policies in the occupied West Bank, notably regarding redrawing the ethnic composition of the territory, have been a slow burn affair. Condemnation and admonitions have issued from various international bodies and civil society groups regarding the settlements of zealous Israeli nationalists. The International Court of Justice, in its 2024 advisory opinion, clarified the point that the settlements in the West Bank and East Jerusalem had "been established and are being maintained in violation of international law" and that "the State of Israel is under an obligation to bring to an end its unlawful presence in the Occupied Palestinian Territory as rapidly as possible". Aside from tepid pronouncements at the government level, specific individuals associated with settlement expansion have been sanctioned in piecemeal fashion by Israel's allies, a measure never likely to turn the violent tide. But given that figures such as Mike Huckabee, US ambassador to Israel and an avid Christian Zionist, could be found condemning the actions of "settler terrorists" while demanding "severe consequences", something was overdue.

The latest announcement by twelve countries, largely seen as friendly to Israel, suggests a change of current. The joint statement by Canada, Denmark, Finland, France, Iceland, Ireland, Norway, Poland, Portugal, Spain, Sweden and the UK confirmed "their intention to introduce national and/or support European restrictions on trade in goods with settlements which are illegal under international law, or that they are actively considering these and other measures, in accordance with their national procedures." The parties demanded that Israel immediately halt the expansion of the settlements and civilian administrative powers in the West Bank, hold those responsible for settler violence accountable and investigate allegations levelled at Israeli forces. "We firmly oppose actions tantamount to the annexation of Palestinian land and forcible displacement of the Palestinian population."

Of the twelve, three – the UK, France and Canada – issued a separate statement at the leadership level confirming that steps will be taken "to ban the importation of goods from settlements and enforce targeted measures against settlements and those who facilitate or profit from them." Having recognised the State of Palestine a year ago, it was time "to take further action to uphold our commitment to protect the two-state solution, our interests and to stand up for our values, before it is too late."

In his September 8 statement to the House of Commons, Foreign Secretary Ed Miliband gave shape to the direction being proposed. He spoke of the "most unimaginable trauma and suffering over the last three years" in Gaza and the crisis in the West Bank. The secretary quoted the firm intention of Israel's Finance Minister Bezalel Smotrich to "bury the idea of a Palestinian State". This sentiment is precisely what signalled the need for "a new approach", one that does not take issue with Israeli citizens but with the conduct of the Netanyahu government. That egregious conduct had seen more settlements approved in less than four years than in the previous two decades. "Houses bulldozed. Roads and public infrastructure destroyed. Families displaced from their homes." Since 2023, 65 Palestinian communities had ceased to exist, with over 4,000 evicted from their homes for reasons of settler violence and actions by the state. Last month, the issuing of E1 tenders for 1,200 homes crossed "a long-standing red line" in prospectively evicting the Bedouin communities currently there and installing settlements between East Jerusalem and the West Bank. "Let's be clear what this means: the creation of a set of facts on the ground to make the two state solution unviable."

Settler terrorism was specifically underlined, with families being encircled by settlers in such places as Al Mughayir, largely with the blessing of the Israeli military. Israeli authorities on the predations being inflicted upon the Palestinians were noted. Former Israeli Prime Minister Ehud Olmert's description on the enterprise spoke of "a violent and criminal effort to ethnically cleanse territories in the West Bank", likewise former Minister of Health and retired Brigadier General from the IDF, Ephraim Sneh. According to Miliband, the definition of ethnic cleansing as described by the UN – "a purposeful policy designed by one ethnic or religious group to remove by violent or terror-inspiring means the civilian population of another ethnic or religious group from certain areas" – had been made out. The settler terrorists had led the effort.

Admitting that previous British policy on the illegality of the settlements was clear, the legality of Israel's occupation had remained untouched. Pointing to the 2024 ICJ decision, the Burnham government accepted "that the occupation is unlawful", manifested by Israel's entrenched control, intention of extending "permanent sovereignty" and the pursuit of an "expansionist agenda via illegal settlements."

The proposed remedy for such ills is, to date, uncharacteristically firm. In a nod to arguments advocating a steelier economic approach, Miliband promised the introduction of "a new comprehensive sanctions regime" formulated with the assistance of the Business Secretary "with appropriate religious exemptions." (This model, he insisted, will not be along the lines of the Boycott, Divestment, Sanctions (BDS) campaign.) The secretary did "not believe that the British people want us supporting the occupation by accepting products from settlements in our shops and supermarkets." As part of the regime, specific companies and individuals offering services in construction, infrastructure, financing or real estate to aid the settlement agenda will be targeted with sanctions. Advertising in the UK of illegal settlements will be banned. A further number of extremist settlers were also to be sanctioned. All license applications for arms and other exports materially contributing to the occupation will be refused. While these measures are in place, the Palestinian Authority is encouraged to accelerate its institutional reforms; Israel, in turn, should release valuable revenue for the provision of essential services in the West Bank.

The response from the Netanyahu government was viciously surly. The Israeli Foreign Minister Gideon Sa'ar briskly announced measures to counter the UK policy, including the closing of the British consulate in Jerusalem, the expulsion of British representatives from the aid centre for Gaza in Kiryat Gat, the halting of British training of Palestinian Authority forces in the West Bank and the barring of 12 elected officials and British citizens "involved in anti-Israel and antisemitic activities" from entering the country. Sa'ar also went to work buttering up the British Conservatives, thanking them for "their firm opposition to the hostile Labour Government's announcement […] and its series of anti-Israel policies since taking office."

While officials huffed, Israeli commentary focused on a trite point: that the government of Prime Minister Benjamin Netanyahu had done much to bring this upon themselves. The conservative Times of Israel took issue with a policy that had failed to "isolate obsessively anti-Israel countries in Europe like Spain and Ireland", making it easier "for those critics to pull powerful states to their side." Itamar Eichner, writing in Ynet Global, reported that Israel had not expected the broader coalition to materialise. "The decision is therefore being viewed in Jerusalem not only as a diplomatic setback but as a significant failure by Israel to prevent a coordinated international initiative."

Whether intentional or not, this new policy reveals a belated acceptance, at least in part, of such assessments as those offered by Francesca Albanese, the UN Special Rapporteur on the situation of human rights in the Palestinian territory occupied since 1967. In her July 2025 report, she observed that "post-October 2023, corporate actors have contributed to the acceleration of the displacement-replacement process throughout the military campaign that has pulverized Gaza and displaced the largest number of Palestinians in the West Bank since 1967." Among the recommendations are the imposition of sanctions and a complete arms embargo on the Israeli state, covering dual-use items, the suspension of all trade agreements and investment relations and the imposition of sanctions, including the freezing of assets "on entities and individuals involved in activities that may endanger Palestinians."

The proposals made by Miliband and his international counterparts differ in confining the sanctions regime to the West Bank settlements ("important and valued trade with green line Israel" would continue), an artificial distinction that fails to account for the broader aspects of the Israeli economy. Nevertheless, this turn suggests a hardening of relations between Israel and countries long considered unlikely to go wobbly on the Jewish state regarding what has, historically, been euphemistically regarded as the "Palestinian issue".