Committee publication · Correspondence · 11 March 2026
Letter from the Minister for the Middle East, North Africa, Afghanistan, and Pakistan and the Minister of State for Trade relating to UK trade with Israeli settlements, 26 February 2026
From: Business and Trade Sub-Committee on Economic Security, Arms and Export Controls
Inquiry: The UK's trade sanctions regime
Summary
Two ministers respond to a committee inquiry on UK trade policy toward Israeli settlements in occupied Palestinian territory. The government condemns Israel's settlement expansion as illegal, outlines existing restrictions (export controls, trade agreement suspension, targeted sanctions on settlers), and states it continues considering options including a potential import ban, while drawing parallels to Russia sanctions enforcement mechanisms.
Key findings
- Government condemns Israeli settlements as 'flagrant violation of international law' and states recent extensions to settlement control are 'deeply concerning'
- UK has stopped relevant IDF exports, suspended Israel Free Trade Agreement negotiations, and imposed sanctions on settlers Ben-Gvir and Smotrich for inciting violence
- On import bans: government has 'not yet come to a definitive conclusion' but will inform Parliament of developments; currently uses declarations and risk-based HMRC checks to verify settlement goods don't receive tariff preferences
- HMRC uses origin verification on a 'risk and intelligence-led basis'; goods lacking origin proof face standard tariff rates rather than preferential treatment
- Government acknowledges Spain and Slovenia have introduced settlement trade bans; Ireland and Belgium reportedly considering similar measures, but declines to confirm joint UK-EU initiatives
Tone
FactualTopics
Key actors
Hamish Falconer MP, Sir Chris Bryant MP, Liam Byrne MP, Ben-Gvir, Smotrich, HM Revenue and Customs (HMRC), Department for Business and Trade, Foreign, Commonwealth and Development Office
Notable line
“Israel's illegal settlements and decisions designed to further them are a flagrant violation of international law.”
Key Quotes
“Israel's illegal settlements and decisions designed to further them are a flagrant violation of international law. We will take concrete steps in accordance with international law to counter settlement expansion and to challenge policies and threats of forcible displacement and annexation.”
“We have stopped relevant exports to the IDF that might be used to commit or facilitate serious violations of international humanitarian law in the conflict in Gaza. We have suspended negotiations on a Free Trade Agreement with Israel.”
“We have not yet come to a definitive conclusion but will inform the House and the Committee of any developments as soon as possible.”
“Where HMRC is not satisfied that the goods meet the conditions for preferential tariff treatment, including where origin cannot be confirmed or evidence indicates that the goods originate from a noneligible location, preferential tariff treatment is refused, and the goods are subject to the standard Most Favoured Nation tariff rate.”
“UK citizens and businesses should be aware of the potential reputational implications of getting involved in economic and financial activities in settlements”
Source · parliament.uk record ↗