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Commission clarifies labelling rules for Israeli settlement products

The European Commission adopted, on 11 November, an interpretative notice on EU labelling rules for products originating in Israeli settlement areas in east Jerusalem, the West Bank and the Golan Heights (territories illegally occupied by Israel since June 1967). The decision met with strong criticism in Israel that regards it as discriminatory.

“We regret that the EU has chosen, for political reasons, to take such an exceptional and discriminatory step, inspired by the boycott movement, particularly at this time, when Israel is confronting a wave of terrorism targeting any and all of its citizens,” Israel’s foreign ministry said in a statement.

Replying to this criticism, Commission Vice-President Valdis Dombrovskis stressed that the guidance issued by the Commission was meant to apply to the Israeli settlement territories only and therefore imports of products from Israel proper would not be affected. “The EU does not support in any way boycott or sanctions against Israel,” Dombrovskis added. He also emphasised that the guidance does not establish any new legislation but only clarifies the existing labelling requirements applicable under EU consumer protection legislation.

Under the EU-Israel Association Agreement, which entered into force in June 2000, Israeli products can enter the EU market on preferential terms. Products from settlements are excluded from this arrangement. They are subject to tariff lines applicable under the most favoured nation treatment principle.

Israel is obliged to indicate the originating postcode of each shipment, while member states’ customs authorities should cross-check the information against a list of settlement postcodes to see which tariffs apply.

According to human rights activists in the region, the Israeli authorities get around this by coding settlement products under firms’ corporate headquarters in Israel proper or by bundling them together with Israel-proper-origin goods. Meanwhile, the lack of clear product-origin labels is making it hard for European consumers to choose whether or not to buy the items.

The Commission’s interpretative notice specifies that agricultural produce and cosmetics imported from Israel and sold in EU member states must now have clear labels showing their place of origin. Imports of processed food products and industrial products will continue to be subject to a voluntary scheme, a Commission expert explained. “In both cases the indication of origin must be correct,” she stressed, adding that these rules will apply to ca. 1% of imports from Israel. “99% of imports from Israel are already with a mark: made in Israel,” the EU expert said.

The EU is the leading trading partner for Israel with total trade amounting to approximately €30 billion in 2014. EU imports from Israel amounted to around €13 billion and EU exports to Israel to around €17 billion.

Israel’s economy ministry estimates that the impact of the Commission’s decision will be about €47 million a year.

The interpretative notice says that for products from the West Bank or the Golan Heights that originate from settlements, the expression “Israeli settlement” or equivalent needs to be added, in brackets. So, “product from the Golan Heights (Israeli settlement)” or “product from West Bank (Israeli settlement)” could be used.

Products from the West Bank not originating from settlements could be labelled “product from Palestine” or “product from West Bank (Palestinian product)”.

The 3-page interpretative notice will enter into force at its publication in the EU’s Official Journal on 12 November.