EU guidelines politicized by the Foreign Ministry

Ze'ev Elkin 370 (photo credit: Marc Israel Sellem/The Jerusalem Post)
Ze'ev Elkin 370
(photo credit: Marc Israel Sellem/The Jerusalem Post)
The publication last July of the EU guidelines on the eligibility of Israeli entities for funding took the Israeli mission in Brussels by surprise.
While the EU side has clarified the meaning of the guidelines, the Israeli ministry, under its deputy minister, seems to have blown them out of all proportions.
What basically is a technical text has become a pretext for Israel to politicize its implementation and recklessly damage EU-Israeli cooperation.
The guidelines shouldn’t of course have come as a surprise to Israel since, basically, they express a long-held EU position on the status of the occupied territories.
A good starting point to understand the EU position is to read the Council conclusions of December 10, 2012, on the Middle East peace process. The guidelines also refer to them.
The objective is a comprehensive negotiated peace based on the two-state solution. Consequently EU will not recognize any changes to the pre-1967 borders other than those agreed by the parties.
In the meantime, it goes without saying that the EU doesn’t want to fund any Israeli entities or activities in the territories. It has been estimated that this amounted to only 0.5% of all funding in the past. The purpose of the guidelines is to prevent this from happening in the future by clarifying the rules and making them enforceable.
This legitimate purpose doesn’t exclude the existence of some anti-Israeli bias on behalf of those members of parliament who pressed for the guidelines or the NGOs who have been advocating them. An example of this is that the guidelines mention Gaza among the ineligible territories.
As everyone knows, Israel has withdrawn from Gaza.
It’s hardly accurate to designate Gaza as “occupied” by Israel. The Gaza strip is ruled by Hamas and there are no Israeli entities there who can apply for funding.
When the guidelines were first mentioned in media last July, well in advance of their entry into force on January 1, 2014, the impression was that the timing of their publication was intended to put pressure on Israel in the peace process. In fact the timing was linked with the discussion which took place among the EU institutions on the new Horizon 2020 regulation which replaces the 7th Framework Program on Research.
There were European members of parliament who linked the parliament’s approval of Horizon 2020 to the adoption of the Commission’s eligibility guidelines.
The issue was introduced via a proposed amendment to an article in the draft regulation on Horizon 2020 penalizing any entity which might have dealings with the occupation.
The parliament wanted the Commission to produce the guidelines so that it could agree to drop the amendment and give a green light only with a reference to the guidelines in a recital.
The amendment was kept in the draft of the regulation until the end of June when an agreement was reached so that the Horizon 2020 legislative package could be processed further for adoption by the parliament and the Council in October-December.
Why then have the guidelines become a sticking point in the relations between Israel and EU? After all the guidelines don’t exclude Israeli entities in Israel proper from applying for EU funding for activities inside Israel although they might have ties with entities in the territories or carrying out other activities there.
As is explained in Frequently Asked Questions (FAQ) at the website of the EU representation in Israel, to be eligible, a company applying for a grant needs to be established in Israel’s pre-1967 lines. In addition, the entity can only apply for EU funding for an activity that takes place inside the 1967 lines or for an activity that is carried out in the occupied territories but that aims to benefit protected persons or promote the Middle East peace process in line with EU policy.
An entity with branches in the occupied territories is not excluded. Natural persons residing in the territories aren’t excluded from working for eligible Israeli entities. The guidelines don’t forbid subcontracting by eligible grant beneficiaries to entities in the occupied territories in conformity with procurement rules.
Export from occupied territories isn’t affected at all.
There is no limitation of exports to the EU of products produced in the settlements but they don’t benefit from exemption from customs duties. An agreement on rules of origin of Israeli products was reached already in 2004 so it’s difficult to see why the issue of labeling should be confused with the eligibility rules.
In case of EU funding in the form of loans, Israeli entities which operate in both Israel and the occupied territories will be considered as not eligible. However, the vast majority of EU funding to Israel is in the form of grants.
The main concern is the declaration on honor. According to the guidelines, entities applying for EU funding would have to declare that they aren’t registered in the territories and that no part of the activity they are applying for takes place there. That is of course fair.
In media however you get the impression that Israeli entities when applying for EU funding would have to declare that they have no ties whatsoever with the occupied territories. This is a gross misinterpretation according to the EU external action service and contradicts the wording in the guidelines.
By repeating the misinterpretation the Israeli ministry of foreign affairs is obstructing a solution and damaging Israeli-EU cooperation.
Another misunderstanding is that the guidelines would require the Israeli government to agree to that all future agreements with EU will state that the occupied territories don’t belong to Israel. That’s far-fetched to say the least.
The guidelines aren’t supposed to be a model for other agreements. Perhaps certain funding regulations might include references to them but more specific references to eligible territory in new agreements would need to be negotiated.
It’s noteworthy that despite the disagreements on the interpretation of the EU guidelines business between Israel and EU seems to continue as usual. Two weeks ago, a large EU delegation headed by Vice-President Antonio Tajani, Commissioner for Industry and Entrepreneurship, visited Israel to enhance even further trade and research cooperation. Currently the total annual trade between EU and Israel is € 29,6 billion.
During his visit, Tajani, according to media reports, tried to calm down the Israeli side and assure Israel that a solution would be found to the guidelines. Someone who apparently didn’t feel reassured was deputy minister of foreign affairs, Ze’ev Elkin, who told media about his fears that the issue wouldn’t be solved.
What interest does the ministry of foreign affairs have in obstructing a solution at the expense of the current fruitful and intensive EU – Israel relations in research, innovation and trade?
The author is a former official in the European Commission where he worked in DG Enlargement as policy coordinator for public administration reform in the candidate countries.