The EU effective next year will fund no Israeli projects in the OPT because the settlements are unlawful. They will further give no grants to Israeli companies with operations in the OPT.
The relationship between the EU and Israel is spiralling downward, after Israel confiscated EU aid in a recent incident, and they manhandled a EU diplomat.
EU’s relations with Israel sink to new low after aid row
"Settlements are illegal under the Fourth Geneva Convention, which bars occupying powers from moving their citizens on to war-won land, such as the Palestinian territories that Israel captured in the 1967 regional war. More than 500,000 Israeli settlers now live in those areas.EU sends $600 million (Dh2.2 billion) to Palestinians in the territories each year. That sum, which does not include money also distributed individually by the bloc’s 28 member countries, in part goes to the West Bank’s Palestinian Authority.The funds are also allocated to development and humanitarian assistance to Palestinians in the Gaza Strip, East Jerusalem and those in an area of the West Bank that falls under direct Israeli administration, known as Area C. The PA has no remit in Area C, Gaza or East Jerusalem.
The European Commission estimates that between 2001 and 2011, Israel destroyed roughly $66m of European-supported development and humanitarian projects in those territories. Much of that destruction occurred during the second Palestinian uprising, or intifada, of 2000 and Israel’s three-week war on the Gaza Strip that began in December 2008.Over the years, Israel has demolished thousands of buildings in what critics describe as a policy of driving Palestinians out of strategically important areas. In many of those cases, Israel flattened buildings for lacking permits – something that Palestinians and aid groups say are practically impossible to obtain.
The demolitions violate international law, Mr Epshtein and Israeli and international human-rights groups say. But he said diplomats felt constrained by fear of fallout with Israel in responding more vociferously to the demolitions, which have left entire communities homeless.
Several European diplomats expressed concern over Israel’s reaction to the incident last month involving the French cultural attaché in Jerusalem, Marion Fesneau-Castaing.The EU ambassador reportedly summoned the deputy general for European affairs at Israel’s foreign ministry for an explanation of the incident, during which Israeli troops confiscated about $15,000 of EU-funded tents and supplies.Witnesses said the soldiers threw stun grenades at the group of European diplomats that escorted the aid to Makhul, a village whose residents were made homeless after Israeli bulldozers levelled it earlier in the month."
EU’s relations with Israel sink to new low after aid row | The National