An Israeli naval vessel on patrol in the Mediterranean near the Lebanese border yesterday. US-mediated talks about the countries' maritime boundaries began in 2020, but have made little progress. Photo: EPA
An Israeli naval vessel on patrol in the Mediterranean near the Lebanese border yesterday. US-mediated talks about the countries' maritime boundaries began in 2020, but have made little progress. Photo: EPA
An Israeli naval vessel on patrol in the Mediterranean near the Lebanese border yesterday. US-mediated talks about the countries' maritime boundaries began in 2020, but have made little progress. Photo: EPA
An Israeli naval vessel on patrol in the Mediterranean near the Lebanese border yesterday. US-mediated talks about the countries' maritime boundaries began in 2020, but have made little progress. Phot

Why are Lebanon and Israel at odds over Mediterranean maritime boundary?


Jamie Prentis
  • English
  • Arabic

A long-running dispute between Israel and Lebanon over maritime boundaries in the Eastern Mediterranean has reared its head again.

It comes as an Israeli official poured cold water on prospects of a renewed conflict between the two nations.

But what is the history of the disagreement and what has sparked its re-emergence?

Why are Lebanon and Israel in dispute?

The argument is over the Karish offshore gasfield, which was discovered a decade ago. Both Lebanon and Israel claim it as part of their respective exclusive economic zones.

US-mediated talks about the countries' maritime boundaries began in 2020, but have made little progress.

Lebanon and Israel last fought a war in 2006 and are separated by a UN-patrolled border. The indirect negotiations, which are currently stalled, have been complicated by the fact that the two countries do not have diplomatic relations.

What sparked the latest controversy?

The arrival of a vessel operated by international energy company Energean to produce gas for Israel at the site, which is about 80 kilometres west of Haifa. It is expected to begin operations immediately, with gas likely to begin coming in from September.

On Sunday, Lebanese President Michel Aoun said negotiations were continuing, adding that “any activity in the disputed area” would be a “hostile act”.

Lebanon said some of the Karish field is within the maritime boundaries it has claimed at the US-mediated negotiations. Beirut expanded its territorial claim by about 1,400 square kilometres to "Line 29".

What is Line 23?

In 2011, in its official decree to the UN delineating its boundaries, Lebanon’s claim did not include the Karish field. That boundary has been known as "Line 23." Beirut has yet to formally amend that claim, known as Decree 6433.

Hassan Diab, Lebanon's caretaker prime minister at the time, approved an amended decree in April last year, but Mr Aoun has yet to sign off on it.

Israel's claim runs farther north than the gasfield.

A tugboat pulls an Energean ship along Egypt's Suez Canal. Photo: AFP
A tugboat pulls an Energean ship along Egypt's Suez Canal. Photo: AFP

Hezbollah, the Iran-backed Lebanese militant group, has threatened to take action against Israel if it carries out operations in the maritime area before the dispute is solved.

“When the Lebanese state says that the Israelis are assaulting our waters and our oil, then we are ready to do our part in terms of pressure, deterrence and use of appropriate means — including force,” Naim Qassem, Hezbollah’s deputy leader, told Reuters on Monday.

“The issue requires a decisive decision from the Lebanese state,” he said. He said Hezbollah “urged the government to hurry up, to set a deadline for itself”.

Imad Salamey, a political analyst at the Lebanese American University, said a continued failure to resolve the dispute would be “to the advantage of Hezbollah” because it could claim to be the only protector of Lebanon’s sovereignty.

Mr Aoun has agreed to invite US energy official Amos Hochstein, who led the demarcation talks, to Lebanon to continue negotiations.

Mr Aoun’s office said Lebanon informed the UN in February that Karish is part of the disputed area and that the UN Security Council should prevent Israel from drilling there “to avoid steps that could form a threat to international peace and security”.

Lebanese MP Melhem Khalaf says Israel's drilling threatens Lebanon's rights. Photo: EPA
Lebanese MP Melhem Khalaf says Israel's drilling threatens Lebanon's rights. Photo: EPA

Where does Israel stand?

Israeli Energy Minister Karin Elharrar insisted on Monday that there had been no encroachment.

She has played down fears of a conflict, referring to a “disconnect” between rhetoric and reality.

But she said: “Israel is making preparations (and) I recommend that no one try to surprise Israel.”

Lebanon’s caretaker Prime Minister Najib Mikati said Israel was “encroaching on Lebanon's maritime wealth, and imposing a fait accompli in a disputed area”.

Lebanon is experiencing a devastating economic collapse, with much of the population falling into poverty. Electricity from the state is available for only a few hours a day, with people forced to rely on expensive generators as a back-up.

Ms Elharrar has expressed hope Beirut will return to the negotiating table.

“Ultimately, there are gains to be made from negotiating, and they can get a gasfield of their own,” she said.

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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Men:

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3. Reuben Kipyego(KEN) 2:08:25 

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Women:

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3. Immaculate Chemutai(UGA) 2:28:30 

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Squid Game season two

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18

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450,000

More than this many Palestinian refugees are registered with UNRWA in Lebanon, with about 45 per cent of them living in the country’s 12 refugee camps

1.5 million

There are just under 1 million Syrian refugees registered with the UN, although the government puts the figure upwards of 1.5m

73

The percentage of stateless people in Lebanon, who are not of Palestinian origin, born to a Lebanese mother, according to a 2012-2013 study by human rights organisation Frontiers Ruwad Association

18,000

The number of marriages recorded between Lebanese women and foreigners between the years 1995 and 2008, according to a 2009 study backed by the UN Development Programme

77,400

The number of people believed to be affected by the current nationality law, according to the 2009 UN study

4,926

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Updated: June 07, 2022, 12:48 PM