EUs Israel Grants Guidelines:

A Legal and Policy Analysis

PROF. AVI BELL & PROF. EUGENE KONTOROVICH
A Kohelet Policy Forum Research Paper
October 2013
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 2
KOHELET POLICY FORUM
Te Kohelet Policy Forum strives to secure the future of Israel as the nation-state of the Jewish People, to
strengthen Israeli democracy, expand individual liberty, and deepen free market principles in Israel. Te Forum
was established by Prof. Moshe Koppel together with leading Israeli academics, public intellectuals and activists.
Te Forum is a non-partisan entity. It relies on private donations and does not accept, directly or indirectly,
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KOHELET POLICY FORUM (RA) 8 Am Volamo St., Jerusalem, Israel, 9546306
Tel: +972-2-631-2720 Fax: +972-2-631-2724 [email protected] www.kohelet.org.il
AVI BELL
Professor Avi Bell is a member of the Faculty of Law at Bar Ilan University and the University of San Diego School
of Law. He serves as a Senior Fellow at the Kohelet Policy Forum. His elds of research include property and
intellectual property law, international law, land use law, the laws of war, and the Arab-Israeli conict.
Bell is one of the leading researchers in Israel in the eld of economic analysis of law. His papers have been
published in leading law journals including Yale Law Journal, Stanford Law Review and Columbia Law Review.
Bell is also one of the worlds leading thinkers on the laws of war. He has been invited to give briengs to
elected ofcials and defense personnel in the United States, Israel, Australia and others countries, as well to UN
commissions of inquiry.
Bell received his BA and JD from the University of Chicago and his doctorate from Harvard University. He has
served as a visiting professor at the law schools of Fordham University and the University of Connecticut. He was
director of the Global Law Forum at the Jerusalem Center for Public Affairs during 2008-2009.
EUGENE KONTOROVICH
Professor Eugene Kontorovich teaches at Northwestern University School of Law and is a Senior Fellow at
the Kohelet Policy Forum. During the 2013-14 academic year, he is also a Lady Davis Visiting Professor at
Hebrew University.
Kontorovichs scholarship has been published in leading academic journals and he is often cited by news
organizations such as The New York Times and Wall Street Journal. He is one of the worlds leading experts
on international jurisdiction and criminal law and has been called on to advise lawyers in historic piracy trials
around the world. He is a widely-sought out lecturer on international law and the Arab-Israeli conict and has
spoken at scores of leading universities. He has also briefed American and European parliamentarians and served
as a consultant to the United States Department of Defense. He has been honored with a fellowship at the Institute
for Advanced Study in Princeton and with the Federalist Societys prestigious Bator Award.
Kontorovich attended the University of Chicago for college and law school and ultimately taught there. He clerked
for Judge Richard Posner on the United States Court of Appeals for the Seventh Circuit.
The authors thank Katja Knoechelmann for her indispensable research assistance.
KOHELET POLICY FORUM
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 3
EXECUTIVE SUMMARY
EXECUTIVE SUMMARY
The Israel Grants Guidelines adopted by the European Commission are singularly discriminatory
against Israel. They contradict international law as established in U.N. documents and leading
court cases, as well as the European Unions own interpretations of international law.
The EU provides aid and nancial cooperation to numerous countries that maintain settlements
in what Europe considers occupied territory, such as Morocco, Turkey, and Russia. In none of these
cases has the Commission imposed limitations on the aid akin to the Guidelines for Israel.
The Commissions position that the Guidelines are mandated by international law are further belied
by EU programs that provide grants specically for settlers in belligerently occupied territory, such
as the EUs programs in Turkish-occupied Northern Cyprus.
Under international law, there are no prohibitions regarding organizations engaging in activities
in occupied territories, yet the Guidelines bar funding solely on the basis of such activities.
In pretending that the Guidelines fulll the requirements of international law, the Commission
exposes the EU to legal challenge for EU funding of parallel activity in belligerently occupied
territories around the world, such as Northern Cyprus, Abkhazia and Western Sahara, and exposes
its businesses operating in such places to liability.
The Guidelines have no precedent in similar arrangements between the U.S. and Israel.
The Guidelines seek to undermine territorial arrangements that are established by existing Israeli-
PLO agreements and foreclose issues that are preserved for negotiations.
The Guidelines do not advance the EU position on sovereignty because they do not relate to
activities that legally establish sovereignty or constitute recognition of sovereignty.
The Guidelines are unlikely to be accepted by Israel in their present form. Non-discriminatory
alternatives include borrowing language from scientic cooperation agreements with the U.S. and
extending the Guidelines to all occupied territories with funding relationships with the EU.
TABLE OF CONTENTS
Background of the Guidelines. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
The Guidelines discriminate against Israel . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Case Study: EU funding in Northern Cyprus . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
The Guidelines undermine the peace process . . . . . . . . . . . . . . . . . . . . . 16
Recommended alternatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Executive Summary (Hebrew) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
BACKGROUND
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 6
On June 30, 2013, the European Commission adopted (and ofcially published on July 19, 2013) a notice
with Guidelines forbidding the allocation of European Union grants, prizes and nancial instruments
to any Israeli entity that has an address in the West Bank, Golan Heights, east Jerusalem or Gaza
Strip.
1
The Guidelines also prohibit giving such grants, prizes and nancial instruments to any activity
carried out by an Israeli entity in those areas unless the activity is aim[ed] at beneting protected
persons under the terms of international humanitarian law who live in these territories or aim[ed] at
... promoting the Middle East peace process in line with EU policy.
The Guidelines apply to:
EU monies granted after December 31, 2013.
EU money, and not to money granted by individual EU states.
Israeli organizations (including local governments) but not to the national government of Israel and
not to individual people.
Israelis and not Palestinians.
The Guidelines appear to have been the work of Catherine Ashton, the High Representative of the
Union for Foreign Affairs and Security Policy, produced within the European External Action Service,
without indication of a broader European consensus. For instance, on the day the Guidelines were
published, a spokesperson for the German Foreign Ministry stated that the European Commission
developed the guidelines on their own prerogative. At the same time, Ashton expressed her pleasure
with the Guidelines and promised new unilateral EU steps against Israel (in the form of discriminatory
labeling requirements for goods imported from Israel) to follow up on the Guidelines.
2
Proponents of the Guidelines claim that they are mandated by international law. Supporters of the
measure have uniformly echoed this justication: because the EU regards the territories as occupied
by Israel, international law obligates it to ensure its monies do not support Israeli activities there.
3
(At
the same time, the Guidelines openly offer money to Israelis to undertake activities in the territories if
they promote European foreign policy, suggesting that the European interpretation of international law
leaves room for funding, depending on how the activities relate to EU foreign policy.)
Reactions within Israel have been almost uniformly negative. Supporters of a negotiated peace with
the Palestinians have noted that the Guidelines will undermine the peace process. The Guidelines both
contradict the existing agreements between Israel and the Palestinians, and grant the Palestinians an
additional incentive for continuing to attack Israels legitimacy while bypassing talks and ignoring their
prior solemn commitments.
1 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2013:205:0009:0011:EN:PDF.
2 Letter dated July 8, 2013 to European Commission President Jose Manuel Barroso.
3 See MEP Elmer Costello, EUs moment of truth on Israeli settlements, http://euobserver.com/
opinion/121415; Barak Ravid, Former EU leaders to Ashton: Stand rm on settlement guidelines, avaialble at
http://www.haaretz.com/news/diplomacy-defense/.premium-1.547188
BACKGROUND
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 7
Other Israeli critics of the EU action have observed that the Guidelines impose upon the Jewish state
of Israel a uniquely restrictive interpretation of international law, and that this interpretation has the
functional aim of rendering large areas of disputed territory empty of all Jewish residents. These critics
note that, in so doing, the Guidelines fall within the European Unions own denition of antisemitism.
The ill-considered Guidelines expose the European Union to considerable legal risk. The legal theory
underlying the Guidelines, as promoted by European ofcials, is that Israeli settlements are illegal
and that the EU must cut off grants that support settlement activity lest the EU be implicated in the
illegality.
4
However, the EU currently and openly supports similar settlement activity elsewhere in
the world. For instance, the EU has a grant program specically aimed at funding Turkish settlers
of Northern Cyprus. If the EU is serious about the legal theory it is using to promote the Guidelines,
it means that the EU violates international law with its grant programs in Northern Cyprus. Future
challengers to EU policy in Northern Cyprus, as well as other occupied territories like Western Sahara,
will use EU arguments regarding the Guidelines to convince courts to rule that EU policy violates
international law.
4 See, for example, http://www.haaretz.co.il/st/inter/Hheb/images/2013-09-16%20EEPG%20Letter%20
on%20EU%20funding%20guidelines. pdf.
BACKGROUND
THE GUIDELINES
DISCRIMINATE AGAINST ISRAEL
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 9
The Guidelines discriminate against Israel and contradict international law
and the EUs interpretation of such law.
There are roughly 200 territorial disputes worldwide, many involving countries exerting control or
occupying territory over which they have no sovereignty. In many of these cases, the EU does not accept
sovereignty claims of the states which administer the territory in question. For instance, the EU does
not recognize Moroccos claim to sovereignty over the belligerently occupied Western Sahara. Similarly,
the EU does not recognize the sovereignty claim of the Turkish puppet state Northern Cyprus, which is
a belligerently occupied part of an EU member state, Cyprus. But while the EU directly acknowledges
the existence of many other belligerent occupations, the Commission does not impose rules similar
to the Guidelines on the EUs funding relationships with any of these other occupying powers. The
Commission sets such restrictions on EU grant-giving on only one country in the world: Israel. In other
words, in adopting the Guidelines, the Commission has set a double standard: it has one rule for the
Jewish state, and a different one for the rest of the world.
Israeli entities do not have a monopoly on conducting activities in what the EU regards as occupied
territory. For instance, numerous European businesses and universities maintain considerable operations
in Western Sahara and Northern Cyprus. In no other case but Israel has the Commission adopted
guidelines that adversely affect funding based on the status of the territory. Nor has the Commission
conditioned EU aid to any EU member states or European businesses and organizations on their vow
not to undertake activities in the territories.
1. The EU does not claim in any other place in the world that it is forbidden to provide grants
to settlements in occupied territory. Indeed, in Northern Cyprus and elsewhere it is EU
policy to provide grants specifically for settlers of such territory.
The Guidelines forbid grantees to engage in activities - or be located in - the disputed areas. EU ofcials
falsely argue that this is required by international law, a policy which falls in line with its opposition to
potential Israeli claims of sovereignty in the disputed areas. Yet, in Turkish occupied Northern Cyprus,
the EU operates a grant program aimed at Turkish Cypriot settlers who were transferred there by the
Turkish government. (See the Case Study below for more detail on this program). The existence of
such programs makes it clear that even according to the EUs view of the law, such Guidelines are not
actually mandated by international law, and that the EU does not generally believe them to be required
by international law.
The North Cyprus program is only the most blatant of numerous EU programs that provide funds to
occupation and settler regimes. In another example, in a recent sheries agreement with Morocco, the
EU pledged nancial grants to develop the Moroccan shery industry as compensation for access to
THE GUIDELINES DISCRIMINATE AGAINST ISRAEL
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Moroccan waters.
5
Yet the Agreement dened the Moroccan shery and waters as including Western
Sahara. Thus the EU directly funds Moroccos exploitation of resources in the occupied territory, and
it recognizes the application of EU-Morocco treaties to territory occupied by Morocco. All of this is in
addition to direct aid to Morocco, none of which requires recipients to make declarations akin to the
Israel Grant directive. Similarly, the EU provides direct aid to the Russian-occupied Abkhazia region
of Georgia, and is indeed the largest donor there. The funding documents note that funding programs
require a pragmatic and exible programme approach given the occupied status of the region.
6
The double standard further carries over when it comes to the obligation of all Israeli grantees to sign a
declaration that they are located within the Green line, and none of their activities take place over the
line, simply by virtue of their nationality. Needless to say, this policy is applied towards Israel only and
not to any other countries with EU- recognized disputed territories.
The uniquely restrictive standard the Guidelines apply to Israel is notable in light of the working EU
denition of anti-semitism, as adopted by the EU Monitoring Centre on Racism and Xenophobia in
2004, which includes among its examples of anti-semitism applying double standards [to Israel] by
requiring of it a behavior not expected or demanded of any other democratic nation.
2. Under international law, there is no prohibition on organizations engaging in activities
in occupied territories, yet the Guidelines bar funding precisely on the basis of such
activities.
The international law of belligerent occupation regulates the exercise of sovereign power by an occupying
state. It does not regulate activities of private entities conducting business or academic programs in
occupied territories. This is amply demonstrated in both formal sources of international law (legal texts
and opinions) and extensive state practice, including the EUs own ofcial activities. It is interesting
to note that the EU directly funds the activities of the Turkish and Moroccan occupiers of Northern
Cyprus and Western Sahara. In fact, the EU maintains an entire ofce devoted to the supporting the
Turkish settlers in occupied Northern Cyprus.
The legality of foreign companies conducting business in occupied territory was recently strongly
reafrmed by the 2013 ruling of the Court of Appeal of Versailles in France in the Alstom case.
7
The
Court held that a company doing business or establishing infrastructure in East Jerusalem in no way
violates international law (the case concerned a rm that worked on the Jerusalem light rail system).
The Court afrmed that an occupying power is bound by certain restrictions, but private entities are
not, even when they are in contractual arrangements with occupation authorities.
5 Morocco-EU shing accord signed after 18-month hiatus (July 24, 2013). The agreements were opposed
by representatives of the Western Saharan population. See Western Saharan Resource Watch, New EU-
Morocco Fisheries Protocol signed today, http://www.wsrw.org/a105x2631.
6 EURAID 2011 Georgia Annual Action Program, Annex 1: Action Fiche, pg. 44.
7 France-Palestine Solidarite v. Alstom, (Cour dAppel de Versailles, March 22, 2013), R.G. N 11/05331.
THE GUIDELINES DISCRIMINATE AGAINST ISRAEL
EUs Israel Grants Guidelines: A Legal and Policy Analysis
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Similarly, in a 2002 legal opinion, the U.N. Security Councils Legal Advisor concluded that foreign companies
taking Moroccan contracts to do business in Western Sahara do not violate international law, even when such
plans are opposed by the protected persons (i.e., people who are not citizens of the occupying country), so
long as the business in question does not disregard the interests of those protected persons.
8
The opinion
considered the fact that the contracts create economic opportunity for Moroccans and Western Saharans,
and it concluded that this is sufcient regard for the interests of protected persons. The EU has relied on
this opinion in allowing its business to operate in Western Sahara.
The matter of the Moroccan-EU agreements generated a fair amount of controversy in the European
Parliament and elsewhere, with some claiming that an extension of such agreements to Western Sahara
would violate the duty of non-recognition, or otherwise be inconsistent with international law. The EU
continues to reject these views; just last year, the EU renewed a trade agreement with Morocco, and this
summer it renewed a sheries agreement. In each case, the EU has relied in its reasoning on the Security
Council opinion above.
Further evidence that the Guidelines are not motivated by international law is provided by the broad
exemption contained in article 15 for Israeli organizations that operate across the Green Line but
happen to promote EU foreign policy. Obviously international law does not contain a rule forbidding
activities except where they concord with EU foreign policy interests. The exception underscores that
the directives are a purely discretionary and discriminatory foreign policy exercise.
3. The Guidelines do not advance the EU position on sovereignty because they do not relate
to activities that legally establish sovereignty or constitute recognition of sovereignty.
In international law, only national governments can assert legal claims of sovereignty, and they can
do so only through sovereign acts such as formal claims of annexation or through the extension of
domestic law to territory. Yet, the Guidelines explicitly exclude the national government of Israel from
the scope of the Guidelines. The Guidelines concern the addresses of organizations and non-national
governments, and commercial, residential and other activities by those actors. None of these can possibly
constitute potential sovereign acts. The Commission recognizes this in its dealings with the authorities
in Turkish-occupied and Russian-occupied territories. For example, the funding program for Abkhazia
simply notes that it should not be considered a form of recognition.
9
There is no way that any of the grants excluded by the Guidelines, or that would be permitted in the
absence of the Guidelines, can have anything to do with a potential claim of sovereignty by Israel.
Moreover, it is clear, as noted above, that there is no connection between giving grants and recognizing
sovereignty. Finally, Israel has not even claimed sovereignty over much of the territory in question, and
thus it is not clear what sovereignty claims the Guidelines seek to not recognize.
8 Letter dated 29 January 2002 from the Under-Secretary-General for Legal Affairs, the Legal Counsel,
addressed to the President of the Security Council, S/2002/161.
9 See Action Fiche, supra, pg. 32 n. 26.
THE GUIDELINES DISCRIMINATE AGAINST ISRAEL
EUs Israel Grants Guidelines: A Legal and Policy Analysis
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4. The Guidelines capacious definition of settlements to include all activity by Israeli entities
has no basis in international law and contradicts the EUs own theory on the illegality of
settlements.
The argument that Israeli settlements are illegal, as endorsed by the EU and by the ICJ, posits that
although no international treaty talks about settlements per se, article 49 of the Fourth Geneva
Convention forbids an occupying power to deport or transfer parts of its civilian population to
occupied territory, and Israel illegally transfers civilians when it permits Israeli citizens to move to the
disputed areas. However, although EU ofcials justify the Guidelines as being related to settlements,
the Guidelines themselves have nothing to do with any Israeli transfer of civilian population. The
Guidelines explicitly blacklist only organizations that have no legal responsibility for transfer. The
Guidelines disqualify organizations simply for being located in or engaging in activities in the
disputed territories. Thus, the Guidelines act only against actions that have nothing to do with any state
transfer of civilian population.
5. The EU Directive finds no precedent in U.S. Grant Guidelines.
Some apologists for the Grant Directive claim it is little different than the requirements of the U.S.-Israel
Binational Science Foundation (BSF).
10
Yet the European Directive goes far beyond the U.S. regulations,
and is indeed notable in how much further it reaches.
For one, the BSF rules were reached through an agreement with the Israeli government, while the EU
effort is unilateral.
More substantively, the BSF rules apply to projects, not entities, and thus would permit funding for
entities based across the Green Line. It would also not bar funding to entities simply because some of
their activities are across the Green Line. The EU Directive, by contrast blacklists any organization
with a bad address, regardless of the project involved, and any organization that operates across
the Green Line. Finally, the BSF rules do not have self-serving exceptions for groups involved in foreign
policy activities sympathetic to the U.S.; indeed, they tend to rule out political projects. The EU Directive
gives a free pass to projects designed to undermine Israeli policy interests.
6. The EU exposes itself and its business to legal action.
The Guidelines propose what is in effect a new rule of international law inconsistent with much current
EU practice. The Guidelines can thus be invoked by litigants challenging EU direct funding or suing EU
companies either in national courts or the European Court for Human Rights. The targets of such suits
could be EU funding for Moroccan activities in Western Sahara and for Turkish activities in Northern
Cyprus, as well as activities by EU companies doing business in those areas.
10 Applicants for grants from the Foundation are informed that According to the agreement between the
U.S. and Israeli governments, projects sponsored by the Foundation may not be conducted in geographic
areas which came under the administration of the Government of Israel after June 5, 1967 and may not
relate to subjects primarily pertinent to such areas.
THE GUIDELINES DISCRIMINATE AGAINST ISRAEL
EUs Israel Grants Guidelines: A Legal and Policy Analysis
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Case Study: The EU directly and indirectly funds Turkish occupation of Northern
Cyprus, despite regarding it as illegal.
The EU knowingly and purposefully gives direct grants, funding, etc. to Turkish-occupied Northern
Cyprus. The EU does so even though the EU regards Northern Cyprus as occupied (indeed, it is an
occupation of an EU member state). The EUs ofcial policy is that Turkey must end its occupation, and
the Turkish invasion was condemned by every international institution from the Security Council on
down. Nonetheless, the EU maintains an entire program to direct funds to Turks in Northern Cyprus.
They even put out a nice colorful brochure last year.
11
The grants are pursuant to a 2006 Regulation adopted by the EU to end the isolation of the Turkish
Cypriot community, and allocated 259 million Euros over ve years.
12
The program now operates on
a 28 million Euro a year allocation (even this small sum is roughly 0.8 percent of Northern Cypruss
GDP).
13
EU-funded projects include study abroad scholarships; grants to small and medium-sized businesses
for the purpose of developing and diversifying the private sector; various kinds of infrastructure
improvements (iterate and telecom improvements, trafc safety, waste disposal, technical assistance to
farmers); community development grants; funding to upgrade cultural heritage sites, etc. The EU
program even puts on a musical concert.
Importantly, the vast majority of the Northern Cyprus inhabitants are Turkish settlers who arrived
subsequent to the invasion in 1974 and who do not have EU citizenship. Yet, none of the Commissions
grant or contracting documents limit eligibility or participation to EU citizens.
Can one imagine a similar EU project in the West Bank funding Israeli trafc safety, or providing grants
to Jewish West Bank residents for study abroad and grants to Jewish-owned small and medium-sized
businesses. Could one imagine one funding Jewish cultural events in the West Bank?
The relevant EU resolutions and reports on the EUs Northern Cyprus program make no mention of
the international legal issues arising from this policy, though they do note the difcult or unique
political context.
14
One reason the EU gives for the funding is that it is preparing for reunication
of an island that is technically in the EU. Yet, it is important to note that funding goes far beyond
particular reunication projects, and gives grants to Turkish private business entities, and builds the
infrastructure of the occupying government.
The EUs own reports make clear that preparing for possible reunication is only one goal of the
11 http://ec.europa.eu/cyprus/documents/2012/eu_assistance_to_tcc_brochure.pdf.
12 Council Reg. (EC) No 389/2006 of 27 February 2006.
13 Aid Program for the Turkish Cypriot Community: Background, available at http://ec.europa.eu/
enlargement/tenders/aid-programme-tcc/index_en.htm
14 Seventh Annual Report 2012 on the implementation of Community assistance under Council regulation (EC)
No 389/2006,, pg. 2..
THE GUIDELINES DISCRIMINATE AGAINST ISRAEL
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 14
program, and general welfare-improvement goals dominate the considerations behind funding. The
EU is doing exactly what it claims that international law prohibits when it comes to Israel.
The contradiction between the Northern Cyprus policy and the Israel policy is much starker. The
Guidelines on Israel aim to regulate groups based in Israel proper and they go out of their way to make
sure no money might be incidentally spent on occupation. Yet no such territorial restrictions are
placed on EU funding to Turkey itself, despite the fact that Northern Cypruss economy is dominated
by Turkish mainland-based entities and direct subsidies from Ankara. The EU funding of Northern
Cyprus goes even further than that: it is a specic project entirely dedicated to funding occupation
activities.
Indeed, the EU maintains an ofce in Northern Cyprus to oversee its over 1000 grant contracts to
NGOs, SMEs, farmers, rural communities, schools, and students.
15
This ofce liaises directly with the
Turkish occupation regime in the territory (which styles itself as an independent republic, but neither
the EU nor any other nation recognize it as such).
The Northern Cyprus program is more agrant in another way. The Israel-related Guidelines make
an exception for activities aimed at helping protected persons, i.e. Palestinians. The Northern
Cyprus funding can not (and does not attempt) to claim this excuse, as i) the majority of the territorys
population is composed of mainland Turkish settlers; ii) the ethnic Greeks present at the time of
occupation have all ed or been expelled.
The EU justication of the Guidelines is that it has no choice - the EU doesnt recognize the disputed
territories as part of Israel, and so no money can go there, and moreover, the EU has some afrmative
duty to prevent money going there. The Cyprus program gives lie to this position. The Israel-related
Guidelines are neither the legal nor logical consequence of Israeli activities, but a discretionary European
political decision to impose a double standard on Israel.
15 Id. at pg. 3..
THE GUIDELINES DISCRIMINATE AGAINST ISRAEL
THE GUIDELINES
UNDERMINE THE PEACE PROCESS
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 16
The Guidelines undermine the peace process and international agreements by
seeking to impose a particular outcome regarding disputed territory, in disregard
of negotiated formulations.
1. The Guidelines seek to foreclose issues that are preserved for negotiations by existing
Israeli-PLO agreements.
The Oslo Accords explicitly preserve the positions of the parties without resolving the question of
territorial sovereignty. Rather, the Oslo Accords assign to direct bilateral negotiations any questions
about borders demarcating the separation between Israels sovereign territory and the territory assigned
to any agreed-upon Palestinian entity. Pending such a nal status agreement, both sides legitimately
maintain their positions. None of the agreements deny Israel the right to assert sovereign claims in such
negotiations. And, of course, none of the agreements empower a third party like the EU to override
the negotiations and impose its own views of sovereignty over the disputed territory. It is a violation
of the spirit of international law for the EU to seek to impose its position on Israel and Israeli entities
unilaterally.
2. The Guidelines seek to undermine territorial arrangements that are established by existing
Israeli-PLO agreements
Although they do not resolve the issue of territorial sovereignty, the Oslo Accords explicitly lay out
the powers and responsibilities of Israel and the Palestinian Authority in the West Bank (as well as
the Gaza Strip, though neither Israel nor the Palestinian Authority exercises effective control there).
They also allude to some powers and responsibilities in Jerusalem. The agreements oblige Israel and
the Palestinians to engage in negotiations regarding settlements (and the Roadmap discusses Israeli
concessions regarding construction in settlements), but none of the agreements place any restrictions
on the actions of private Israeli entities in the territories. By contrast, the Israeli-PLO agreements do
place geographical restrictions on public actions of various Palestinian authorities in several locations;
for instance, Palestinian authorities may not lawfully maintain their ofces within Jerusalem.
3. The Guidelines seek to establish the pre-1967 armistice lines (the Green Line) as borders of
Israeli sovereignty, contrary to international law and the negotiated agreements between
Israel and its neighbors.
The Guidelines explicitly and erroneously refer to the pre-1967 armistice lines as borders, and implicitly
and incorrectly insist not only that the EU does not recognize potential Israeli claims to sovereignty
in the disputed territories but that Israel is not entitled to assert those claims. Yet, numerous written
agreements among parties to the peace process show that the EUs position is wrong. (The line between
Israel and the Golan Heights, on the other hand, is an international border. It stems from the historical
division between the Mandates in Palestine and Syria).
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While the EU is certainly entitled to aspire to limit the ultimate sovereign territorial scope of Israel,
its aspirations have no basis in any binding legal document. The peace agreement between Israel and
Jordan establishes the international boundary between Israel and Jordan at the Jordan River (without
prejudice to the status of the territories occupied by Jordan prior to 1967); it does not deny Israeli
sovereignty over the West Bank or east Jerusalem. All of Israels peace agreements with bordering
states including the unratied agreement with Lebanon and the ratied peace treaties with Egypt
and Jordan have relied on the boundaries of the Palestine Mandate prior to Israels independence to
establish Israels current boundaries, rather than the armistice lines of 1949-1967 (or any UN-proposed
boundaries).
The non-binding advisory opinion of the ICJ on the Wall (non-binding by law) explicitly avoided ruling
on the question of territorial sovereignty.
16
Indeed, the Court specically criticized the route of the
Israeli-built barrier because it could prejudge the future frontier between Israel and Palestine.
17
Thus,
in the view of Court, there was no recognized frontier between the two entities. If the Green Line were
the recognized frontier, the Wall would not prejudge it, but rather simply infringe upon it.
16 Legal Consequences of the Construction of a Wall in the Occupied Palestinian Territory (ICJ 2004),
par. 52-54.
17 Id. at par. 121 (emphasis added).
THE GUIDELINES UNDERMINE THE PEACE PROCESS
RECOMMENDED ALTERNATIVES
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 19
The EU has better alternatives to achieve its policy aims: it can either negotiate
a more modest understanding directly with Israel or it can adopt Guidelines
that clarify EU policy without creating a double standard.
While the Guidelines contradict international law and EU practices, the EU does have alternative policy
tools to clarify and amplify its policy stances on Israel and the status of the disputed territories.
The Commission can begin by rescinding the Guidelines in their entirety and issuing a clarication to
the effect that it has further reviewed the matter and determined that the Guidelines are not required
by international law. This clarication is important if the EU is to defend itself against future legal
challenges against its policies in Northern Cyprus, Western Sahara and other disputed territories.
There is no difcult formal process required for the EU to rescind the Guidelines the Commission
can cancel them in exactly the same way it issued them; this is not a decision that requires unanimity
among EU states.
If the Commission feels it is important to adopt measures to advance the purported policy goals of the
Guidelines, there are several possible alternative means of doing so, either produced via negotiations
with Israel or unilaterally by issuing less problematic language.
1. A Negotiated Alternative: A Memorandum of Understanding Concerning EU Policy
In order to ensure respect for EU policy regarding Israel and the peace process, the EU could issue
together with Israel the following memorandum of understanding. It is likely that Israel would nd this
memorandum agreeable.
MEMORANDUM OF UNDERSTANDING
The EU afrms that no EU grants, prizes or nancial instruments will support activities that violate
existing agreements between Israel and the PLO regarding the geographic location of activities.
The EU afrms that the borders of Israels territorial sovereignty with its neighbors are those previously
determined by legally binding agreements produced through direct negotiations between the affected
parties; where the borders are unresolved by agreement, the EU afrms that the borders will be those that
are established through direct negotiations between the affected parties. No EU grants will be granted
in support of activity that unilaterally establishes borders pending agreement or alters borders already
agreed upon.
No assistance to Israeli entities located in or carrying out activities in areas under Israeli jurisdiction
should be construed as EU recognition of Israeli sovereignty in those areas. No assistance to Israeli entities
should be construed as altering the EUs long standing position on the illegality of Israeli settlements as
the EU understands that term.
RECOMMENDED ALTERNATIVES
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 20
2. A Negotiated Alternative: A Memorandum of Understanding Concerning EU Grants
The EU could negotiate with Israel for a narrower Memorandum of Understanding that does not clarify
the EUs overall policy on Israel and borders, but does clarify the EUs policy on grants. This provision
presented here is based upon similar language used by the Binational Science Foundation (between
Israel and the US), as well as existing language contained in Commission funding programs for other
occupied territories.
MEMORANDUM OF UNDERSTANDING
No projects sponsored by the EU grants may be conducted in geographic areas which came under the
administration of the Government of Israel after June 5, 1967 nor may such projects relate to subjects
primarily pertinent to such areas.
3. A Unilateral Alternative: Broad but Universal Guidelines
If the EU is unwilling or unable to negotiate with Israel an agreement clarifying the application of EU
policy to grants and the like, the Commission could issue alternative guidelines that use EU funds to
promote EU policies without creating a double standard.
The simple means of doing this would be to reissue the current Guidelines but rephrase them so they are
universal. The new guidelines would apply to all EU grants everywhere in the world. Specically, they
would apply to all entities organized under the laws of countries or organizations which are involved
in EU frameworks. The new guidelines would forbid all grants, etc., to (1) entities with addresses in
territories under administration of any country where the EU does not formally recognize the sovereignty
of the country over the territory being administered or (2) any activities that take place in territories
under administration of any country where the EU does not formally recognize the sovereignty of the
country over the territory being administered.
These alternative guidelines would remove the taint of a double standard from the Guidelines on Israel.
However, they would also make it impossible for the EU to continue its current funding practices in
Northern Cyprus, Western Cyprus and in disputed territories elsewhere in the world.
RECOMMENDED ALTERNATIVES
EUs Israel Grants Guidelines: A Legal and Policy Analysis
PAGE 21

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EXECUTIVE SUMMARY (HEBREW)