British foreign secretary Ed Miliband accused Israel of "ethnic cleansing" in the West Bank as a dozen countries backed restrictions on trade with settlements in response to rising attacks on Palestinians.
Mr Miliband said the ban would be introduced through a "comprehensive sanctions regime", as he described Israel’s illegal expansion into the West Bank as “ethnic cleansing”
"We will take action against specific companies and individuals who provide services such as construction, infrastructure, financing, or real estate for settlement expansion," he told parliament on Tuesday.
The UK government now considers Israel's occupation of the Palestinian territories to be unlawful, Mr Miliband added.
"The British government has rightly said settlements are illegal, but we have remained silent on the question of the legality of the occupation as a whole, which in 2024 the International Court of Justice concluded was unlawful," he said.
"Today, I announce that the official view of the British government is that the occupation is unlawful because of Israel's entrenchment of its control, its intention to extend permanent sovereignty, and its expansionist agenda via illegal settlements," he said.
Eleven other countries including France, Canada, Denmark and Poland said on Tuesday they would back or consider restrictions on trade in goods with Israeli settlements in the West Bank that are illegal under international law.
French foreign Minister Jean-Noel Barrot the West Bank was "close to exploding."
"Why are we doing this? Because the West Bank is close to exploding - there is frenzied expansion of the settlements, a flare up of violence against Palestinians by extremist settlers, and acts of terror which have been attacked by Israeli authorities themselves," added Barrot.
"The Government of Israel's actions in the West Bank are undermining the possibility of a two-State solution," the statement by the 12 foreign ministers said.
"Today, Canada, Denmark, Finland, France, Iceland, Ireland, Norway, Poland, Portugal, Spain, Sweden and the UK confirm their intention to introduce national and/or support European restrictions on trade in goods with settlements which are illegal under international law, or that they are actively considering these and other measures, in accordance with their national procedures," it added.
Mr Miliband said the move brings the UK in line with the International Court of Justice’s advisory opinion, and hopes the measures can be a "prelude to justice".
“The British government agrees that there is ethnic cleansing of Palestinians in areas of the West Bank, perpetrated by settler terrorists," he said.
“All too often the Israeli government has turned a blind eye to this and worse, members of it have made statements and taken actions to support the forced displacement of Palestinians," he said.
He said the UK’s suspension of over 30 arms licences used by the Israeli military in Gaza would be extended to include “all license applications for arms and other exports that materially contribute to the occupation.”
“In effect, a double lock against arms sales. This means the ban on such exports will now remain in place as long as the occupation persists,” he said.
He stressed that the sanctions would target only illegal settlements, not Israel, and spoke of his opposition to the Boycott, Divest and Sanctions movement (BDS).
Iran referred to UN Security Council
The UK government will be re-imposing "major economic sanctions" on Iran, "line with the EU and the United States," Mr Miliband said on Tuesday.
It will also be reporting Iran to the UN security council this week "for its nuclear violations," he added.
The Iran-backed Lebanese militia Hizballah's financing arm, Al Qard Al Hasan, will also be subject to sanctions, Mr Miliband said - as he stressed that the UK would continue to support Israel in its fight against Iran and its proxies.
“Tackling these important threats is just one of the important shared national security interests we have with Israel and with which we continue to cooperate," he said.
Overdue measures
The sanctions of settlement goods are the UK government’s most serious step to date, and comes after growing pressure on the Labour government to do more to hold Israel to account.
To date, the UK has sanctioned around two dozen organisations and individuals linked to settler violence, and has excluded settlement goods from the preferential trade tariffs applied to Israeli products.
Supporters of the ban say that the measure is welcome but long overdue.
Hussam Zomlot, Palestine's Ambassador to the UK, said the "courageous" ban "follows naturally" from the UK's recognition of the State of Palestine last year.
But he also called on further measures to end the UK's involvement in the occupation, including a full arms embargo, and sanctions on Israeli agencies and institutions that support illegal settlements.
"Protecting the Palestinian people from illegal occupation, annexation and apartheid; ending the ongoing genocide in Gaza; and holidng to account those who have commited war crimes - these are essential for making the recognition real, meaningful and enduring," he said.
Almost half of the UK (46 per cent) support a ban on trading with illegal Israeli settlements compared to 18 per cent according to polling by the European Council on Foreign Relations, published on Tuesday. That support rises to nearly three quarters – 72 per cent versus 28 per cent – when excluding those who did not voice an opinion.
Implementation challenges
There are questions still about how the ban will be implemented.
One chief concern is how the government will distinguish between Israeli goods, and those originating from illegal settlements. This concern is shared by both backers and critics of the ban.
Labour MP Sarah Champion, who heads the International Development Committee, highlighted that up to 40 per cent of Israeli settlement goods that are mislabelled when imported to the UK.
"British consumers should not be placed in a position where they every day purchases may unknowingly support illegal settlements," she wrote, in a letter to the Minister for the Middle East Stephen Doughty earlier this week.
Likewise, the group Labour Friends of Israel fear that the ban on settlement purchases could lead to a "de-facto boycott" of all goods from Israel, because many Israeli companies have financial links to settlements.
The UK will also need to balance its trade sanctions with support for the Palestinian economy in the West Bank, which is linked to Israel and the settlements. Ms Champion also called on the government to challenge the restrictions that the Israeli occupation imposes on Palestinian goods.
Some campaigners would also like to see the ban extended to goods from Israeli settlements in the Golan Heights, Syrian territory which Israel has occupied since 1967.
Israeli retaliation
Israel has vowed to retaliate, and could expel British diplomats, as it has done for other countries who applied a trade ban.
President Isaac Herzog called the measures a "miscalculation" and a "gross interefence" in Israel's upcoming general elections in October.
Sanctioned Israeli minister Itamar Ben Gvir threatened to recognise Argentina’s claim to the Falkland Islands .
Liberal pro-Israeli campaign groups in the UK have also argued that punishing Israel could embolden the far-right ahead of the October elections.
