European Union foreign ministers will on Monday hold a first discussion on a confidential European Commission paper that maps three options for restricting trade with Israeli settlements in the occupied West Bank, according to EU diplomats and officials. The measures under consideration — an import licensing system, prohibitive tariffs, or a full ban — are being examined as the bloc faces increased pressure from member governments to respond to what they describe as escalating violence by Israeli settlers and the continued expansion of settlements under Prime Minister Benjamin Netanyahu’s government. No formal decision is expected at the meeting, with diplomats indicating the session will serve to gauge the political landscape across the 27 member states.

Divisions within the EU on Middle East policy remain deep, and the debate extends to the legal threshold required to adopt any trade restriction. Some diplomats argue that a ban would need a qualified majority of at least 15 countries representing 65 percent of the bloc’s population, while the Commission’s paper suggests unanimous support may be necessary — a bar that, if confirmed, would make a decision highly unlikely. The discussion follows a July 2024 advisory opinion by the International Court of Justice, which stated that Israel’s occupation and settlements are illegal and that states should act to prevent trade or investment relations that help maintain the situation. Israeli Foreign Minister Gideon Saar has previously described European efforts to implement that opinion as “shameful.” Israel views the territory as disputed and cites a Jewish presence stretching back thousands of years, rejecting the international legal consensus that the settlements are unlawful.

The settlement debate is part of a broader Foreign Affairs Council agenda that also covers Ukraine, the Black Sea, and the Gulf. According to the published agenda, ministers will discuss Ukraine’s energy preparedness for the coming winter, air defence needs, and further measures to counter Russia’s “shadow fleet,” including possible new sanctions. The council is also expected to approve new thematic listings under several sanctions regimes. On the Middle East, the agenda notes that ministers will review the situation in Iran and the Gulf following a US-Iran memorandum of understanding signed on 17 June, as well as freedom of navigation in the Strait of Hormuz, before turning to the deterioration in the West Bank and the Commission’s options on settlements.

In a parallel development that underscores the friction between Israel’s settlement policy and international positions, Israel’s National Security Ministry is making a 4-million-shekel grant to a nonprofit organisation that operates in illegal West Bank outposts and was sanctioned last month by six countries, including the United Kingdom, France and Canada. The funding, designated for “risk reduction” among West Bank youth, was reported by Haaretz. The EU itself imposed sanctions in May on four entities and three individuals over what it called serious and systematic human rights abuses against Palestinians in the West Bank. European Commission spokesperson Paula Pinho confirmed the paper has been shared with member countries but declined to comment on its contents. The ministers’ discussion is expected to produce a clearer picture of member-state positions, with any follow-up steps likely to be determined at a later session.