In a written answer on 4 August 2026, European Commission Vice-President Maroš Šefčovič defended the EU's approach to trade with Israeli settlements, arguing that imposing tariffs on settlement products is not a form of normalising illegal trade but rather a measure consistent with international law. Responding to a parliamentary question from Nacho Sánchez Amor (S&D), Šefčovič clarified that trade with settlements is not itself illegal under international law, but that the EU's non-recognition and non-assistance policies align with its obligations. He noted that goods from settlements are subject to the EU's Most Favoured Nation tariff rate, which applies by default to imports not eligible for preferential treatment.
The answer comes amid ongoing EU discussions on possible trade measures against Israel. On 17 September 2025, the Commission proposed a partial suspension of the EU-Israel Association Agreement on certain trade matters, following a review that found indications of breaches of human rights and democratic principles. More recently, on 13 July 2026, Member States discussed options for further trade-related measures on settlement products, as presented by the Commission, in line with European Council conclusions from June 2026. Šefčovič's response reiterates the EU's long-standing position, first articulated in a 2024 reply to a parliamentary question, that it does not recognise Israel's sovereignty over territories occupied since 1967 and considers settlements illegal.
The answer provides no new concrete proposals or timelines, instead reaffirming existing commitments and the legal framework. It signals that the Commission views tariffs as a legitimate tool within its trade policy, distinct from outright bans, and that any further measures will be developed through the established institutional process. The response underscores the Commission's intent to uphold international law while navigating the complex trade relationship with Israel, balancing legal obligations with diplomatic and economic considerations. Stakeholders affected include EU importers of settlement goods, who face continued tariff costs, and Israeli producers in the settlements, who may see increased trade barriers. The answer also has implications for EU foreign policy coherence, as it seeks to reconcile trade policy with the EU's legal and political stance on the occupied Palestinian territories.