Both the EU and the U.S. have been the targets of the Israel's government's strong protests against the European Commission's July 2013 guidelines excluding Israeli entities established or active in settlements from EU funding.

These protests have had some, limited, effect: U.S. Secretary of State John Kerry urged the EU to postpone implementation of the guidelines, using the same – shockingly disingenuous - argument previously made by Israel, i.e. that the guidelines would put in danger the Israeli-Palestinian peace negotiations. He urged the EU to “find a way to embrace the negotiators and encourage them to move forward rather than metaphorically bang them over the head”. The EU replied that the guidelines were simply “putting down on paper what is currently the EU position”. However, in a conciliatory gesture, it agreed to send a top-level delegation to Jerusalem to make sure the implementation of the guidelines was done “sensitively” and restated its wish to continue having a strong relationship with Israel.

It is important to explain why the EU should not give in to the Israeli government’s demands.

Delaying implementation of the guidelines until the end of the Israeli-Palestinian negotiations would have long-term consequences. The guidelines are not due to take effect before January 1st, 2014, the same date as the Horizon 2020 research program comes into force. A delay beyond the start of year means that for the next 7 years Israeli entities will gain unlimited access to EU funding, even if the activities being funded are carried out in settlements.

Nor do the guidelines in any way affect negotiations with the Palestinians. The EU’s position has always been that the borders between Israel and Palestine should be the result of negotiations between both States and that it would accept any such mutually agreed borders. At the same time it has always maintained that the starting point for those negotiations should be the pre-1967 borders. This is the basis on which all previous negotiations were held. In taking this position, the EU is not “banging the Israelis over the head” but repeating something that was generally accepted until Prime Minister Netanyahu recently framed it as a question.

The guidelines merely set forth the EU’s well-known position. The EU's Foreign Affairs Council affirmed back in December 2013 that Israel needed to acknowledge expressly that its agreements with the EU do not apply to territories beyond the 1967 borders did not give rise to any reaction on the Israeli side. In fact, Israel has already concluded agreements stipulating that they do not apply to these territories, such as the 1972 agreement with the U.S. to establish the US-Israel Bi-National Science Foundation and the 1986 agreement establishing the German-Israeli Foundation. Israel's sudden indignation that the EU should now impose this requirement cannot therefore be sincere.

The EU is not alone in considering that settlements are illegal, and the guidelines demonstrate the EU's conformity to international law as its own Treaty requires. Its position is shared by the entire international community, affirmed in numerous resolutions of the UN Security Council as well as in the 2004 advisory opinion of the International Court of Justice on the Wall.

The guidelines are limited in scope. Contrary to what is often stated in the press, they do not apply to all Israeli entities having “direct or indirect contacts” with settlements, but only to those having their “place of establishment” in occupied territory. Other entities are excluded only if the activities they plan to carry out in the framework of EU-funded grants are to take place in occupied territory. Thus an entity active, among other places, in occupied territory may apply for EU funding if the activities it intends to carry out with the funds received do not take place there. Critics of the guidelines should be grateful that, for practical reasons, the European Commission did not follow some Member States' suggestion to exclude not only legal entities, but also individuals living in settlements from receiving funds, even though this would have been justified in theory.

Many Israelis criticize the guidelines for imposing “sanctions” on Israel while not reacting at violations of international law committed by other countries. One of the most vocal expressions of this alleged “discriminatory outlook” can be found in the former Israeli ambassador to Canada Alan Baker's opinion piece in Haaretz . He accuses the EU of “glaring hypocrisy” by its “obsessive fixation” on the settlement issue and its refusal to sanction other countries acting in violation of international law. It is not difficult to show why this accusation does not hold water.

Firstly, the EU is not expressing an opinion about Israel’s violations of Palestinian human rights but purely the issue of the legality of the occupation of Palestine. Any parallel with parts of the world where serious violations of human rights occur without attracting EU sanctions is therefore unjustified.

Moreover Baker's criticism is based on an erroneous understanding of the facts:

Cyprus: When Turkey seized control of the northern part of the island of Cyprus, it established there the so-called Turkish Republic of Northern Cyprus. The EU has never recognized that government and does not recognize the validity of certificates of origin issued by the customs authorities of Northern Cyprus. There is no significant difference in the way the EU treats northern Cyprus and Israeli settlements in Palestine.

Tibet and Xinjiang: These are situated within the internationally recognized borders of China.

Similarly Kashmir, Polynesia, and New Caledonia are situated within the internationally recognized borders of the states that administer them. Requiring special labeling or restricting financing for products or activities in these regions would give rise to a justified complaint by the administering countries of interference in their domestic affairs. On the contrary, Israel rules over territories situated outside its internationally recognized borders. Although many in Israel lose sight of that fact, the occupation of East Jerusalem, the West Bank, the Golan Heights and the Gaza Strip is illegal in international law and has never been internationally recognized. Therefore the analogy made by Ambassador Baker does not hold.

Abkhazia (and Southern Ossetia and Transdniestra, which the Ambassador could have mentioned as well) were occupied by Russia, which established puppet governments there. These are not recognized by the EU. Exports (if any) from these illegally occupied territories could not be passed off as being of Russian origin without contravening EU and national labelling rules. But since the quantities exported to the EU are minimal and have not given rise to problems, the need to craft rules targeting them specifically has not arisen.

All this shows that there is no valid reason, whether from a legal, a political or a logical point of view, to modify or delay implementation of the guidelines. They do not put in jeopardy the peace negotiations nor play into maximalist Palestinian positions but merely restate the well-known EU position.

Their scope is more limited than what is generally assumed. They do not unfairly pick on Israel but are a first step in the EU's implementation of policies that for too long remained purely rhetorical. Acceding to Israel’s demand that they be delayed or their contents watered down would cause the EU to lose all international credibility, in addition to breaching its obligation under Article 3(5) of the Treaty to contribute to the “strict observance of international law, including the principles of the United Nations Charter”.

Willem Aldershoff held various positions in the Departments for International Relations and Justice and Home Affairs at the European Commission and is now an independent advisor on EU policy on Israel and Palestine, Brussels.

Michel Waelbroeck, previously a visiting Professor at the Law Schools of New York University and Michigan University, the European University Institute in Florence and Columbia University is Emeritus Professor of European Law at the Université Libre de Bruxelles.

Open gallery view Construction in the West Bank settlement of Modi’in Ilit. Credit: AP