Lawyers for Palestinian Human Rights (LPHR)
October 12, 2015
Helpful map to avoid breaking the law on illegal settlements, West Bank
On Saturday 3 October 2015, the Conservative party issued a press release announcing plans to introduce “new rules to stop politically-motivated boycott and divestment campaigns by town halls against UK defence companies and against Israel.”
It is apparent from the substance of the press release that the government’s proposed action is targeted at the Boycott, Divestment, and Sanctions (BDS) movement against Israel. LPHR does not take a policy on BDS in relation to Israel proper, but we do take a considered policy position that the UK government should withhold incoming and outgoing trade with illegal Israeli settlements as a matter of compliance with their fundamental legal obligations.
We are seriously concerned that the press release does not properly distinguish between local government boycott and divestment initiatives with Israel proper, and those that specifically relate to illegal Israeli settlements in the occupied Palestinian territory (OPT). This apparent conflation is noted by the examples cited to justify the plans, including reference to Leicester City Council passing a policy last year to boycott goods produced in illegal settlements in the occupied West Bank.
Accordingly, our initial view is that these plans do raise very important questions concerning their compatibility with the UK government’s long-standing and unequivocal policy recognising the illegality of Israeli settlements in the OPT, and the current guidance issued to UK businesses which clearly discourages trade with them.
UK government’s existing position on UK businesses operating with illegal settlements
The Foreign and Commonwealth Office (FCO) has published guidance which discourages UK businesses from operating with illegal settlements. The Overseas Business Risk advice for Israel states:
The UK has a clear position on Israeli settlements: The West Bank, including East Jerusalem, Gaza and the Golan Heights are territories which have been occupied by Israel since 1967. Settlements are illegal under international law, constitute an obstacle to peace and threaten to make a two-state solution to the Israeli-Palestinian conflict impossible.
Set against this clear legal context, the guidance states:
There are therefore clear risks related to economic and financial activities in the settlements, and we do not encourage or offer support to such activity.
In addition to this significant advice to UK businesses operating with illegal settlements, the guidance adds that UK government ‘strongly opposes boycotts’. This indicates that the FCO does not equate non-recognition of settlements with boycotting Israel. Any failure to distinguish between these two policies represents a new and deeply worrying departure.
Legal consequences flowing from the illegality of settlements
It is important to be aware that there are legal consequences flowing from the illegal status of settlements. The establishment of illegal settlements and their related infrastructure obstructs the Palestinian right of self-determination. The right to self-determination is recognised by the International Law Commission as a norm of such importance – called a ‘peremptory norm’ – that it includes a separate and additional legal obligation on all states, including the United Kingdom, to respect and promote this specific right.
The International Law Commission (ILC) Articles on State Responsibility for Internationally Wrongful Acts, clarify that the duty on states consists of an obligation not to recognise as lawful, or act in a manner that implies recognition for, a situation resulting from a violation of a peremptory norm, even if committed by another state. Nor may they render aid or assistance in maintaining that situation. The International Court of Justice has confirmed, in the context of the construction of the illegal Wall in the occupied West Bank, that the duty on all states of non-recognition and non-assistance applies to the obstruction of the right of self-determination for Palestinians.
Initiatives to refrain from trade or investment with internationally recognised illegal settlements, as reflected in the FCO guidance to UK businesses operating with illegal settlements, entirely aligns with the above fundamental legal obligation on all states to respect and promote the vitally important Palestinian right to self-determination.
Need for UK government clarification
Our initial view outlined above on the government’s plans does not take into account whether the plans are consistent with other relevant areas of law, for example, trade law and procurement law. It also does not address the very important issue of what impact these plans may have for local council’s ethical investment policies more generally. LPHR will be examining these issues going forward.
For now, it is essential that the UK government clarifies the apparent disjunction of the recently announced plans with their coherent existing policy and guidance in relation to illegal settlements. If the government’s plans are found to be incompatible with their current policy and guidance on illegal settlements, it is imperative from a rule of law perspective that they should be withdrawn.
Dearbhla Katharine Minogue; Tareq Shrourou; Claire Jeffery
Government to stop ‘divisive’ town hall boycotts & sanctions
Action to curtail ‘municipal foreign and defence policies’; Growing spread of militant divestment campaigns against UK defence and Israeli firms; Conservatives warn economic and national security from municipal militancy; Government to change pension and procurement rules to protect taxpayers’ interests.
Press release, Conservative Central Office
October 03, 2015
Government Ministers announced today new rules to stop politically-motivated boycott and divestment campaigns by town halls against UK defence companies and against Israel. There is growing concern over the militant actions of left-wing councils, spurred on by trade unions and the Labour leadership, which threaten to poison community relations and harm Britain’s economic and international interests.
Labour’s Jeremy Corbyn and John McDonnell, alongside Labour-affiliated trade unions, are urging councils to use their procurement and pension policies to punish both Israel and the UK defence industry. Faith leaders have expressed alarm at such policies fuelling anti-Semitism – and worryingly encouraging further protests such as kosher food being taken from supermarket shelves and Jewish films being banned. Separate hard-left campaigns against British defence companies threaten to harm Britain’s £10 billion export trade, destroying British jobs, and hinder joint working with Israel to protect Britain from foreign cyber-attacks and terrorism.
The Government will amend pension legislation to make clear using pensions and procurement policies to pursuit boycotts, divestments and sanctions campaigns against foreign nations and the UK defence industry are inappropriate, other than where formal legal sanctions, embargoes and restrictions have been put in place by the Government. The Government will similarly issue new Procurement Policy guidance to implement the same approach in procurement law.
Greg Clark, Secretary of State for Communities and Local Government, said:
Divisive policies undermine good community relations, and harm the economic security of families by pushing up council tax. We need to challenge and prevent the politics of division. Conservatives will provide the stable, competent and sensible Government that working people want to see.
Matthew Hancock, Minister for the Cabinet Office, said:
Conservatives are on the common ground. We will take steps to stop such outdated policies being pursued through procurement and pension policies. We will safeguard the security of families at home and prevent such playground politics undermining our international security.
For further information, please contact the press office on 020 7984 8121.
Notes to Editors
HARD-LEFT FOREIGN AND DEFENCE POLICIES ON THE RISE
In November 2014, Labour-run Leicester City Council passed a policy to boycott goods produced in Israeli settlements in the West Bank (link). Jewish groups have recently launched a judicial review against the council’s decision, warning ‘this amounts to a get-of-out-town order to Leicester Jews’ (Daily Express, 25 August 2015, link).
In January 2015, Labour councillors on Nottingham City Council debated a boycott against Israel (link) – the council resolved to consider the issue further and ‘work with the Nottingham Palestine Solidarity Campaign’ (link). Jewish faith leaders warned: ‘local authorities need to be guardians of good community relations and not go down the route of setting one community against the other by adopting partisan campaigns’ (Jewish News, 26 January 2015, link).
Jeremy Corbyn is a patron of the Palestine Solidarity Campaign radical fringe group (link). In August 2015, whilst running for Labour leader, he endorsed the boycott of Israeli settlement goods and was receptive of academic boycotts of Israeli universities involved with the arms trade (link). He asserted: ‘I fully support the call to end all trade and investments with the illegal settlements’ (Labour Friends of Palestine and the Middle East, link) and ‘I think the boycott campaign, divestment campaign, is part and parcel of a legal process that has to be adopted’ (link).
Corbyn has also called for the removal of Israel’s right to trade with the UK and the EU: ‘It’s time, indeed past time, to demand the immediate suspension of the trade agreements between the EU and Israel’ (Morning Star, 2 June 2010) and cutting all off commercial and diplomatic ties: ‘no arms, no money, no recognition and no support for Israel’ (Haaretz, 13 April 2002, link). Corbyn was even heckled at the Labour Party Conference’s Labour Friends of Israel event for refusing to refer to Israel by name in his speech (Daily Telegraph, 29 September 2015, link).
Labour MPs such as Shabana Mahmood have personally taken part in supermarkets protests against Israeli goods (Daily Mail, 19 August 2014, link).
Both Corbyn and John McDonnell have sponsored a Commons motion urging the boycotting of Israeli goods, including demanding that all supermarkets boycott such goods (EDM 57, 14 May 2012). John McDonnell has told shops in his constituency of Hayes ‘to boycott Israeli goods… and find alternative suppliers’ (Get West London, 1 August 2014).
In August 2014, the SNP-led Scottish Government published a procurement notice to Scottish councils which ‘strongly discourages trade and investment from illegal settlements’, though conceding that ‘decisions need to be taken on a case by case basis’ (Scottish Procurement Policy Note 4/2014, link). Four Scottish councils have resolved to boycott Israeli goods: Clackmannanshire, Midlothian, Stirling, West Dunbartonshire (link).
In June 2015, Labour-affiliated UNISON launched a campaign to lobby councils to divest their Local Government Pension Schemes from companies linked with Israel (A UNISON guide to pension fund engagement and divestment, link). In July 2014, Labour-affiliated Unite resolve to campaign for boycott of goods produced by Israeli settlements and divest from any financial holdings in any companies or funds linked to the settlements (Unite press release, 11 July 2014, link). In July 2013, the Labour-affiliated GMB voted to support boycott and divestment initiatives against Israeli settlements, and banned its members from visiting Israel on delegations organised by the Trade Union Friends of Israel (link).
By contrast, the last Labour leader, Ed Miliband, opposed such ‘BDS’ policies: ‘I think the boycotts of Israel are totally wrong. We should have no tolerance for boycotts. I would say that to any trade union leaders’ (Jewish Chronicle, 7 March 2013, link) and ‘boycotts of Israel will never be a way of advancing the cause of peace. They are the wrong response and I will never support them. Labour will continue to resolutely oppose the isolation of Israel. The answer has to be greater dialogue and greater engagement rather than disengagement and boycotts’ (Jewish News, 1 May 2015, link).
The hard-left Campaign Against the Arms Trade has been lobbying for Local Government Pension Schemes to divest funds in British manufacturers such as BAe (link). Jeremy Corbyn has endorsed their campaign: ‘The Campaign Against the Arms Trade… has a long and honourable tradition… The scale of British arms sales is truly astounding… we need a clear lead for arms conversion. Let the brilliance and skill of those in the arms industry be converted for peaceful purposes’ (Corbyn website).
Shadow Chancellor, John McDonnell, has similarly called for ‘the end of the arms trade’ (Guardian, 1 April 2009).
DANGEROUS CONSEQUENCES OF HARD-LEFT POLICIES
Local government pensions are a funded scheme. Councils’ goals should be to ensure that their pension funds investments deliver the best rate of return. Councils receive £3.1 billion a year from their pension investment returns; in addition, town hall pensions cost taxpayers a further £6.0 billion a year in employer contributions – equivalent to over £300 a year on a Band D council tax bill. Twisting investment decisions on political grounds risks reducing investment returns, requiring larger employer contributions to compensate: in turn, such higher costs would force cuts to services and/or hikes in council tax.
It is not for local government to pursue its own municipal foreign or defence policies – as rightly, that matter is reserved to the UK Government. The Government has to take into account the international implications of such policies, and the broader need to maintain stability and security in international relations. Rather than encouraging legitimate debate, such boycotts are counter-productive – they widen gaps in understanding, poison and polarise debate, and block opportunities for co-operation and collaboration.
The call for municipal boycotts against Israel threatens to inflame tensions in local communities, undermining integration and fuelling broader anti-Semitism. Such militant boycotts have already led to hard-left groups pressuring supermarkets to take Kosher products off their shelves (link), and Jewish films being banned as part of such boycotts (link).
The campaign against British defence companies risk harming Britain’s export trade and would destroy British jobs across the country. The UK defence sector has a £22 billion turnover a year and contributes £10 billion to UK exports (ADS fact sheet, link).
This Government wants to enhance the growing economic ties between the UK and Israel, particular in areas like technology and science, as well as working together to strengthen security against cyber-attacks and tackle Islamist extremism (No10 press release, 10 September 2015).
The UK Government has put in place formal legal sanctions and restrictions at a national level, when justified as in the national interest (link).
The Government will take action to curtail such municipal foreign and defence policies:
The Local Government Pension Scheme (Management and Investment of Funds) Regulations 2009 requires local authorities to publish and follow a Statement of Investment Principles (link). These statements must also comply with guidance issued by the Secretary of State. The government propose to amend the secondary legislation to make clear that such boycott, divestment and sanctions (‘BDS’) campaigns are inappropriate – other than where formal legal sanctions, embargoes and restrictions have been put in place by the Government. There is a statutory requirement to consult on the pension law changes.
The Cabinet Office will issue a revised Procurement Policy Note to public authorities to make clear that boycotts in procurement policy are inappropriate, outside where formal legal sanctions, embargoes and restrictions have been put in place by the Government. Indeed, the WTO Government Procurement Agreement – an international market access agreement – requires all those countries that have signed up to the Agreement to treat suppliers equally. This includes the EU and Israel. Any discrimination against Israeli suppliers involving procurements covered by the Agreement would therefore be in breach of these treaty obligations.
Procurement guidance relates to England. Local government pension regulations relate to England and Wales.
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