The United Kingdom Foreign Office, along with a coalition of Western nations, is set to announce a sanctions package against Israel this week. The measures aim to deter companies from participating in a proposed West Bank settlement known as E1, which would split the occupied territory in two and render a two-state solution nearly impossible. The announcement follows a warning from nine countries, including France, the UK, and Australia, that settlement violence must cease and that no business should engage in the E1 development. Tenders for over 3,000 homes between Jerusalem and the Ma'ale Adumim settlement were opened this month, threatening to sever the West Bank into northern and southern sections, effectively preventing a contiguous Palestinian state.
Labour MPs Demand Urgent Action
In a related development, 137 Labour MPs, including former health secretary Wes Streeting, have signed a letter to Foreign Secretary Yvette Cooper. The letter urges the government to take "urgent, concrete action" to counter escalating violations against Palestinians in the occupied West Bank and East Jerusalem, particularly by ending trade with illegal Israeli settlements. Melanie Ward, who organized the letter and previously served as chief executive of Medical Aid for Palestinians, stated: "Banning settlement trade would send the clearest possible message to Israel that settlements can have no viable economic future and are rejected by the world. This is needed now more than ever."
UN Condemns Displacement Orders
Last week, the UN Committee on the Exercise of the Inalienable Rights of the Palestinian People condemned an order signed by Israeli Finance Minister Bezalel Smotrich to begin displacing the Palestinian Bedouin community of Khan al-Ahmar in the occupied West Bank. The committee stated that the order would "heighten the risk of forced transfer of the civilian population" and called such moves illegal and a war crime. The MPs' letter highlighted that Khan al-Ahmar is "in a gruelling struggle against erasure, displacement and state-backed settler violence as part of Israel's E1 plan," which seeks to bisect the West Bank and make the two-state solution impossible.
Growing International Pressure
The letter to Cooper, signed by chairs of every Labour-led select committee, former safeguarding minister Jess Phillips, and foreign affairs select committee chair Emily Thornberry, notes that despite the government's February 2026 pledge to take "concrete steps" against forcible displacements and annexation, "the situation has worsened considerably and the government has taken no further action. This is unacceptable." The MPs urge Cooper to follow other European countries like Spain, which has begun enforcing a ban on products from Israeli settlements in occupied Palestinian territory. Ireland, the Netherlands, and Belgium are also legislating for similar bans. The letter argues that the UK would not need primary legislation to enact a ban, citing a precedent in UK law and policy of not trading with illegally occupied lands, including Crimea and parts of Ukraine.
Joint Statement from Western Nations
On May 22, nine Western countries issued a joint statement declaring: "The E1 settlement development would divide the West Bank in two and mark a serious breach of international law. Businesses should not bid for construction tenders for E1 or other settlement developments. They should be aware of legal and reputational consequences of participating in settlement construction including the risk of involving themselves in serious breaches of international law." The UK sanctions package is expected to outline penalties for UK firms involved in E1 and impose new sanctions on entities supporting settler violence. However, it remains unclear if the UK will go as far as banning trade with illegal settlements entirely.
Previous Sanctions and Ongoing Tensions
In August 2025, the UK sanctioned Itamar Ben Gvir, Israel's security minister, and Bezalel Smotrich. However, the EU drew back from similar measures last month due to internal opposition and the need for unanimity, with the Czech Republic reportedly holding out. Smotrich has described the E1 settlement as "Zionism at its best – building, settling and strengthening our sovereignty in the land of Israel," and stated it would bury the idea of a Palestinian state. French Foreign Minister Jean-Noël Barrot said at the weekend: "I have pushed for sanctions to be imposed not only on those responsible for this violence, but also on the entities, companies and organisations in Israel that are providing these extremist settlers with the means to drive Palestinians from their land, burn their crops and destroy their public buildings."
Meanwhile, meetings are underway in Cairo with Hamas, the dominant Palestinian faction in Gaza, to break the deadlock over the territory where Israel is threatening to expand areas under its control and has stepped up attacks. Hamas told envoys from Donald Trump's Board of Peace and mediators Egypt, Qatar, and Turkey that ending Israeli attacks in Gaza is essential for any progress.
