The key question about the UK’s decision to ban trade in goods and services from illegal Israeli settlements in the Occupied Palestinian Territories is whether – and how – such a ban can be enforced. To answer this question, it’s worth looking at how such sanctions are already enforced in similar situations.
Blood diamonds, the precious stones whose proceeds are used to finance war, are often cited as an example of the way countries can avoid trading in commodities that can contribute to harm. But the goods and services involved in the sanctions on West Bank settlements are far less valuable.
Exports include agricultural products like dates and olives, supporting – according UK foreign secretary to Ed Miliband – settler terrorism and ethnic cleansing. While blood olives might not have the same ring to it, enforcement challenges are similar to those with blood diamonds.
The announced sanctions have been widely reported as impossible to implement. The Foreign, Commonwealth and Development Office (FCDO) has previously expressed “reasonable concern” that the enforceability of sanctions would be undermined because distinctions between the internationally recognised area of Israel and the Occupied Palestinian Territories are not applied consistently. The FCDO also expressed concerns about over-compliance with sanctions and unintended consequences.
The sanctions build on existing law. The FCDO strongly advises “against conducting any economic and financial activities in illegal Israeli settlements”. Since 2005, products produced in Israeli settlements located within the territories occupied by Israel since 1967 are not entitled to benefit from preferential tariff treatment upon entry into the United Kingdom. A list of non-eligible locations is published at postcode level.
Provenance is important for many products, especially in the agri-food sector. But establishing the origin of products is challenging. In the West Bank, boundaries are more political than geographical. Olive trees in illegal settlements and neighbouring core Israeli territory are likely to share climate, geology, and even their irrigation water sources. This makes the olives indistinguishable.
With no way to determine the precise origin of all products imported from the West Bank, origin becomes a paper claim. The responsibility for verifying that claim lies with customs authorities. This is a significant challenge for often already stretched resources.
In the EU and UK, products from illegal settlements do not receive the same preferential treatment as products from other parts of Israel. Nevertheless, analysis from the Israel corporate and legal watchdog, the Global Echo Litigation Center of 30,000+ trade records estimates roughly one-fifth of Israeli shipments to the EU originate from a settlement.
Their report highlights methods of obscuring or falsifying product origin. Some exporters include the postcode of an illegal settlement as the true origin of the product, claiming the location is in Israel. Others provide a false address within Israel. True origin can also be obscured by mixing products from Israel with those from settlements. This typically happens during packaging or further processing, for example of grapes to wine or olives into oil.
How sanctions can be enforced
Many other schemes exist to prevent products reaching certain markets. A prominent example is the Kimberley Process, which came into force in 2003 to stop the trade in blood diamonds. The cost of its certification processes and audits is trivial compared to the value of the diamonds and there are relatively few production points for diamonds. Nevertheless, the Kimberley Process has faced criticism for enabling diamond laundering. The cost of certification is more significant for products with a lower unit value, such as the ones exported from the West Bank.
An example of origin verification of agricultural products is the EU Deforestation Regulation, which aims to guarantee that the products EU citizens consume do not contribute to deforestation or forest degradation. Its requirement to submit precise origin information along the whole supply chain has been postponed twice because of the high implementation cost.
The simplified package, to be enforced from December 2026, is estimated to represent a roughly 75% cut in compliance costs compared to the original design. Detailed origin verification, as will be needed to enforce the announced sanctions on illegal settlements, is expensive.
The US’s Uyghur Forced Labor Prevention Act takes an alternative approach that shifts the burden of proof to importers. Importers have to provide clear and convincing evidence that any goods from the affected region are made without forced labour. They are then placed on a list of permitted importers. This approach could provide a blueprint for prior approval of entities rather than retrospective scrutiny of individual shipments from the West Bank.
For Russian-occupied Ukrainian territory, sanctions are in place prohibiting imports from non-government controlled Ukrainian territory.
Read more: UK plan to sanction Israel’s illegal West Bank settlements is a historic shift in tone and policy
The difference here is that Ukraine is involved in certifying origin. All goods from the West Bank, whether Palestinian exports or from settlements, depart through Israeli ports under Israeli authority. And, as Global Echo’s research has shown, these have been found to be untrustworthy on questions of origin certification.
This has design implications for supply chains that include products from the West Bank. Origin has to be established before exporting. A clear chain of custody must preserve identity and segregation so products of different origins are not mixed. Otherwise a ban on imports from the illegal settlements is meaningless.
Combined with shifting the burden of proof to a limited list of importers, a chain of custody could make the announced sanctions actually enforceable.
Unintended consequences
There are also concerns about unintended consequences of the announced sanctions. In terms of supply chains, these might include damage to trade with Israel, which includes pharmaceutical products, cosmetics and technology.
And, if new rules and regulations are seen as complex, they might deter companies from importing from the West Bank entirely, to the detriment of Palestinian exporters.
Ultimately, the question is not whether the UK can differentiate between settlement olives and Israeli ones. It is a question of who bears the cost of proving origin. Main UK imports from the occupied Palestinian territories include fruits and vegetables, as well as oils and fats.
Many Palestinians in the West Bank depend on agriculture for their livelihoods. Unless proof of origin is designed into supply chains, they will be the most severely affected.
