Britain is set to announce fresh sanctions against Israel this week with other western states in opposition to the E1 settlement project, which would effectively split the occupied West Bank in two.
The Foreign Office is expected to announce that UK firms will be sanctioned if they have any involvement in E1, according to the Guardian. It will also impose new sanctions on entites seen as supporting settler violence.
Middle East Eye reported last week that the UK was likely to impose a ban soon on the import of goods from illegal Israeli settlements.
It is unclear whether the measures that will be announced this week will go that far.
Although the construction plan for the E1 settlement project dates back to the 1990s, its implementation has repeatedly been delayed due to strong international opposition.
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Because it would split up the north and south of the occupied West Bank, it would make a contiguous Palestinian state impossible.
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“This is how we effectively kill the Palestinian state,” Israeli Finance Minister Bezalel Smotrich, who also oversees settlement activity and civilian affairs in the occupied West Bank, said about the plan.
Nine countries, including Britain, France and Australia, warned in late May that no company should be involved in E1.
More than 140 MPs signed a letter organised by Labour MP Melanie Ward over the weekend urging Foreign Secretary Yvette Cooper to end “trade with illegal Israeli settlements”.
The letter was especially significant because it was signed by the Labour chairs of every parliamentary select committee, as well as by former Health Secretary Wes Streeting, who has said he wants to be the next prime minister.
The letter accuses the government of an “unacceptable” failure to act sufficiently to combat settlement expansion.
It urges the foreign secretary to impose a ban on the import of settlement goods.
‘The UK is falling behind our allies’
Spain has already imposed a ban on settlement goods and Ireland, the Netherlands and Belgium are in the process of introducing bans.
The letter says: “The case for ending trade with settlements is clear. The international court of justice has directed third states not to enter into ‘trade dealings with Israel concerning the occupied Palestinian territory’, which is widely interpreted as meaning states must not trade with settlements.”
According to several people close to the government, Middle East Minister Hamish Falconer told Labour MPs late last year that a ban on settlement goods is desirable.
The ultimate decision, however, lies with Downing Street.
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Emily Thornberry, a senior Labour MP and the chair of parliament’s Foreign Affairs Committee (FAC) who had signed the letter over the weekend, told MEE last week that the “situation in Palestine is intolerable, and yet we tolerate it”.
Thornberry said Britain must “make it so economically painful for Israel that settlement expansion becomes untenable”.
Polling of Labour members released on Wednesday showed that a staggering 87 percent support a ban on trade with Israeli settlements, with only six percent opposing it.
Abtisam Mohamed, a Labour MP who sits on the FAC, has secured a debate in parliament on banning settlement goods.
Its date has not yet been confirmed, but the debate will pile further pressure on the government.
“The ICJ’s [International Court of Justice’s] ruling that no state should aid or assist in the illegal occupation of Palestine is now two years old and the UK is falling behind our allies,” Mohamed told MEE last week.
An ICJ opinion in 2024 ruled that Israel’s occupation of Palestinian territory is illegal.
According to Israeli human rights group B’Tselem, Israel has driven out 59 Palestinian communities, home to more than 4,000 people, since 7 October 2023.
The United Nations recorded almost 2,000 settler attacks in 2025 – approximately five a day.
In May 2024, the Labour government sanctioned several prominent Israeli settlers in the West Bank, including veteran settler activist and head of the Nachala movement Daniella Weiss.
Last June, the UK – alongside several allies – then sanctioned two far-right Israeli ministers, National Security Minister Itamar Ben Gvir and Finance Minister Bezalel Smotrich, over “their repeated incitement of violence against Palestinian communities” in Gaza and the West Bank.
