Brussels’ Toughest Package Ever Against Israel Divides Member States

The European Commission on Wednesday, September 17th unveiled its most extensive package of pressure against Benjamin Netanyahu’s government. The plan includes partially suspending the trade agreement that for three decades has granted Israel tariff advantages in its relations with the European Union, proposing sanctions against ministers deemed extremists, and freezing certain bilateral cooperation programs.

The announcement comes while Israel is conducting a major ground offensive in Gaza that has placed Jerusalem’s actions under growing international scrutiny. Brussels insists its aim is not to “punish Israel” but to send a message to the Israeli government that “red lines” have been crossed.

At the heart of the proposal is the suspension of tariff preferences Israel has enjoyed in the EU since the 1990s. According to EU estimates, the measure would affect Israeli exports worth around €5.8 billion—37% of the total—implying an additional tariff cost of about €227 million annually.

The most affected sectors would be agricultural products, which would lose preferential treatment. The measure does not imply a trade blockade but rather a return to the “most-favored nation” principle of the World Trade Organization, applicable to third countries without a special trade agreement with the EU.

However, this initiative still needs to pass the political filter of the 27 Member States: it requires the backing of a qualified majority (15 Member States representing at least 65% of the Union’s population). Countries such as Hungary, Austria, and the Czech Republic have already expressed disagreement, and Germany and Italy also seem reluctant to fully endorse the proposal.

Alongside the trade front, Brussels has also proposed sanctions targeting some of the controversial figures in the Israeli government. Finance Minister Bezalel Smotrich and National Security Minister Itamar Ben-Gvir could face asset freezes within EU territory and entry bans into the Union.

The list also includes several violent settlers and organizations active in the Judea and Samaria (the West Bank), as well as Hamas leaders responsible for the October 2023 attacks. However, unlike the trade suspension, individual sanctions require unanimity among Member States, making their approval uncertain.

The Commission has also decided to immediately suspend specific bilateral support programs for Israel, particularly those aimed at institutional cooperation and development. This amounts to around €20 million, excluding projects linked to civil society and the Holocaust memorial at Yad Vashem.

Brussels would leave funding for NGOs and so-called reconciliation projects untouched.

The European move responds to the conclusion that Israel has violated essential elements of its association agreement with the EU, particularly the article concerning respect for human rights and democratic principles. The alleged blocking of humanitarian aid to Gaza, the intensification of the military offensive, and the expansion of settlements in the West Bank are the key arguments advanced by the Commission.

European Council President António Costa welcomed the proposal, emphasizing that it is not aimed at the Israeli population but at government decisions. “Europe cannot accept going beyond the legitimate right of defense,” he stated.

Tel Aviv reacted immediately. Foreign Minister Gideon Sa’ar warned Israel “will respond accordingly” if the EU approves the measures. In a social media post, he described the Commission’s recommendations as “morally and politically distorted” and warned that such actions “will harm Europe’s own interests.”

Israel maintains that the war is existential and that measures of this kind only weaken its allies at a time when the country is fighting Hamas and other terrorist groups. Netanyahu’s government is counting on its closest European partners to block the process in the EU Council.

The fate of the plan now lies in the hands of European governments. If a qualified majority is achieved, the trade suspension will take effect within 30 days and must be notified to the WTO.