Israel will make it clear to the European Union that it will not sign any future agreements that restrict European assistance, grants or investments on Israeli entities with a direct or indirect connection to the West Bank, East Jerusalem or the Golan Heights. Nor will Israel agree to include in agreements with the EU a territorial clause that requires it to acknowledge the fact that its sovereignty does not extend beyond the 1967 lines.
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The new EU guidelines regarding the settlements were first reported in Haaretz on July 15. The new guidelines were then published in writing on July 18 and will take effect beginning on January 1. According to the guidelines, any funding or financial investment, and granting of stipends, scholarships or prizes by EU agencies or foundations to Israeli groups connected directly or indirectly to the settlements will be banned. The guidelines also determine that in any agreement between Israel and the EU there must be a clause to the effect that the settlements on the West Bank, East Jerusalem and the Golan Heights are not a part of the State of Israel.
The Israeli decision was reached at the conclusion of a well attended discussion convened by Prime Minister Benjamin Netanyahu on Thursday morning at his office in the Kirya Defense Ministry headquarters in Tel Aviv. The discussion was convened in light of the negotiations expected to begin with EU representatives next Wednesday, August 14, on the scientific cooperation agreement Horizon 2020. As part of the agreement, the EU was expected to invest over 600,000 euros in Israeli high-tech companies in the coming years. Participating in the discussion were Finance Minister Yair Lapid (Yesh Atid), Education Minister Shay Piron (Yesh Atid), Science Minister Yaakov Perry (Yesh Atid), Justice Minister Tzipi Livni (Hatnuah), Economy Minister Naftali Bennett (Habayit Hayehudi), Agriculture Minister Yair Shamir (Likud) and Deputy Foreign minister Ze'ev Elkin (Likud).
A senior diplomatic source noted that the ministers present at the meeting agreed that the new EU guidelines on t the settlements significantly undermines the diplomatic process with the Palestinians. He said that an understanding was reached during the discussion that Israel would not be able to sign agreements with the EU based on the new guidelines. "It was agreed that we will request additional clarifications from the EU in order to better understand the significance of the guidelines," said the diplomatic source.
Netanyahu plans to conduct a phone conversation with the High Representative of the European Union for Foreign Affairs Catherine Ashton in the coming days in order to update her on Israel's position. The ministers decided that the first meeting with EU representatives would take place next Wednesday as scheduled. But at the start of the meeting, as well in the concluding announcement, it will be made clear that Israel is conditioning the signing of the present accord and other future agreements on a change in the wording of the guidelines on the subject of the settlements to appear in the agreement.
Israel is not demanding that the EU change the guidelines on the settlements, but only the way in which they will be reflected in agreements with Israel. Israel will present several reservations:
1. Israel is opposed to the demand that Israeli firms or organizations will have to submit a written declaration to EU foundations, in which they promise that they have no direct or indirect connections with groups in the settlements or the West Bank, East Jerusalem and the Golan Heights.
2. Israel is also opposed to the clause that determines that Israeli organizations will not have been eligible for European loans if they have an indirect connection to the settlements. For example, Teva Pharmaceuticals would have been ineligible for a loan of 200 million euros that it received from the EU, only because it has a plant on Har Hotzvim beyond the Green Line in Jerusalem. Israel believes that this is an all-encompassing demand that goes beyond the question of where the European money will go, and that if no red line is set here this demand is liable to expand.
3. The negative reservation is related to the European demand to introduce a territorial clause in the agreement specifically stating that Israel recognizes the fact that it is not sovereign beyond the 1967 lines and that therefore the agreement does not apply to those territories
"We will not sign the guidelines in their present form," said a senior Israeli official who participated in the meeting convened by Netanyahu. "On the other hand, we want to conduct negotiations with the EU so that the Horizon 2020 agreement for scientific cooperation, as well as other agreements, can in fact be implemented. If nothing changes it will be impossible to sign. We want to find a creative solution. We will work with EU headquarters in Brussels and with all 28 capitals of the member countries and explain that this is a genuine crisis situation that requires a solution."