Passing of Israeli goods ban bill could put US companies in a bind

12 Jul 2018

Leinster House. Image: Timothy Dry/Shutterstock

A bill banning the importation of Israeli goods produced on Palestinian territory has passed in the Seanad.

The Control of Economic Activity (Occupied Territories) Bill 2018 has passed in the Seanad.

Proposed by Independent Senator Frances Black, the private members’ bill would essentially make it a criminal offence to purchase goods and services from Israeli settlements, which have been deemed illegal by both Ireland and the EU. Black said that the bill can be applied to all similar settlements worldwide and has been drafted to be enacted generally.

According to The Irish Times, the bill passed its first vote in the Seanad by 25 votes to 20 yesterday (11 July). Fianna Fáil, Labour, Sinn Féin and several Independent senators support the bill. The Government is strongly opposed to the passage of the bill and An Tánaiste Simon Coveney, TD, has lobbied members of Fianna Fáil against it. The Government would prefer a unilateral, EU-led response to the settlements issue as opposed to striking out alone.

Israeli goods ban poses potential issues for US firms in Ireland

Fortune reported that the bill, if enacted, could force US companies with Irish subsidiaries or divisions to essentially choose between violating Irish or US law. If the Irish bill is enacted and the firms abide by it, they will be breaking US law, which currently bans US firms from taking part in foreign boycotts not supported by its government.

Currently, the US accounts for a massive 67pc of foreign direct investment (FDI) in Ireland, so the bill could present some serious compliance issues for these corporations with presences here and in the US. Law professor Orde F Kittrie claimed that the bill could mean major alterations to Ireland’s links with these firms and may impact future FDI decisions.

The bill could see Ireland become the first EU country to ban settlement goods and services, but would not apply to goods or services from within Israel itself.

Black said the second stage passing of the bill was “testament to the fact that this is not a radical act”, describing it as “the bare minimum that should be expected of an EU member state”.

She added: “We are simply saying that, if we are sure that certain goods have been produced as a result of war crimes, we should not be trading in them.”

In January of this year, the Israeli settlement project was declared a war crime by the International Criminal Court.

The Israeli embassy condemned the bill, deeming it “populist” and “dangerous”, warning that it would have a negative impact on diplomacy in the Middle East. Palestinian rights groups praised the bill, urging other nations to follow Ireland’s lead.

What comes next?

The bill was first tabled in January of this year, but was delayed after Israeli prime minister Benjamin Netanyahu ordered that Ireland’s ambassador to Israel be summoned to account for the changes outlined in the documents.

It is now expected to move through the Seanad next term, then moving to committee stage and, following this, debate and vote in the Dáil. If all entities that currently support the bill maintain this position, it will likely be passed into law.

Leinster House. Image: Timothy Dry/Shutterstock

Ellen Tannam was a journalist with Silicon Republic, covering all manner of business and tech subjects