What’s happened: Following Foreign Secretary Miliband’s announcement that the UK was introducing a raft of measures centered on banning the sale of settlement goods, Israel has now provided its own response.

• In a speech made yesterday afternoon, Foreign Minister Saar announced four decisions:
  • The closure of the British Consulate in Jerusalem.
  • The removal of British representatives from the International Gaza Support Centre in Kiryat Gat.
  • The termination of British activities to train Palestinian Authority (PA) forces under the “British Support Team in Ramallah.”
  • The denial of entry to Israel to 12 British elected representatives and other British nationals involved in antisemitic and anti-Israel activity, as well as those who deny the very existence of the State of Israel.
• Saar described Miliband’s comments as “outrageous lies,” but also added, “we have nothing against the British people. We know that we have many friends in Britain.”
• He continued, “Unfortunately, a hostile Labour Government is in office, systematically acting against the State of Israel, and it has left us with no choice but to finally respond to its hostile actions.”
• “The British move is morally distorted and constitutes blatant interference in the affairs of a sovereign state and in its electoral process.”
• “The attempt by the British Labour Government to impose measures in the style of the “White Paper” carries echoes of the antisemitic words of British Lieutenant-General Barker, commander of British forces in the Land of Israel during the Mandate, who said: “punish the Jews by striking at their pockets.”
• Saar termed UK reasoning that the timing was based on the E1 tenders as “false claims,” adding, “no new decisions have been made regarding development in E1.”
• Saar stressed that the E1 decision was taken more than a year ago, and the tender process has been underway for many months, adding that the claims regarding the severing of potential Palestinian territorial contiguity were also baseless. “The decision of the Government of Israel, taken more than a year ago, stipulated that two roads would be built: the first, Road 80, which will serve as a major transportation route from the Bethlehem area to the Ramallah area; the second, known as the ‘Fabric of Life’ Road, between a-Za’im and al-Ezariya. The claim of harm to ‘Palestinian territorial contiguity’ sounds particularly ridiculous coming from those who insist on defining Judea and Samaria and the Gaza Strip as ‘one territorial unit.’”
• Saar continued, “The decision of the Labour Government also constitutes a gross interference in the electoral process of a sovereign state. This is a blatant and completely unacceptable attempt by a foreign government to exert external influence in the midst of an election campaign.”
• He also listed a series of unilateral measures taken against Israel since the Labour Government took office in July 2024.
  • “Recognition of a virtual “Palestinian state” in September 2025.”
  • “The resumption of funding for UNRWA, even though its employees were actively involved in the October 7 massacre.
  • “The suspension of licenses for defence exports to Israel
  • “Sanctions on Israeli ministers; sanctions on Israeli individuals and entities;
  • “The suspension of negotiations on a free trade agreement;
  • “Restrictions on Israel’s official participation in the international defence and security equipment exhibition in Britain;
  • “The freezing of military dialogue and security cooperation;
  • “Preventing IDF officers from participating in training at the Royal College of Defence Studies.
• He connected all these moves with, “biased and one-sided anti-Israel rhetoric,” which he said “have already contributed significantly to the unprecedented rise in antisemitic attacks, including violent attacks against British Jews.”

Context: The UK measures and the Israeli response plunge bilateral relations to their lowest ebb in decades. The timing appears politically motivated on both sides.

• For the British government it was convenient to make this announcement ahead of Labour Party Conference where this will appeal to the grassroots and left wing of the party, and counter their competition from the Green Party and pro Gaza independents.    
• For Saar and Netanyahu, this was an opportunity for them to show strength in the context of their re-election campaign.      
• Israeli officials had been anticipating this initiative from the UK government but were surprised by the harsh tone of Miliband’s speech and coordinated aspect with the other 11 countries.
• Following the UK, the Foreign Ministers of Canada, Denmark, Finland, France, Iceland, Ireland, Norway, Poland, Portugal, Spain, and Sweden all confirmed, “their intention to introduce national and/or support European restrictions on trade in goods with settlements which are illegal under international law, or that they are actively considering these and other measures.”
• The response against the UK was particularly harsh as Israel identified their leadership on this matter.      
• Meanwhile, US Secretary of State Rubio was emphatic, saying that the US “obviously” wouldn’t be following the UK, while suggesting that the move could have “implications on our ability to make progress in Gaza with the 20-point plan and the Board of Peace, which we’re very committed to.”
• It is understood Prime Minister Burnham has not spoken to Netanyahu since taking office. Underlining partisan support, Saar said he had a “great conversation” last night with the Leader of the Opposition Kemi Badenoch and Shadow Foreign Secretary Tom Tugendhat. According to his post on X he, “thanked them for their firm opposition to the hostile Labour Government’s announcement,” adding, “I welcomed their support for the friendship with Israel and their commitment for the future relations between our countries. We know that we have many friends in the UK, but unfortunately we are faced with the ongoing hostility of the current Labour government.”
• Outgoing Israeli Leader of the Opposition and former Prime Minister Yair Lapid reportedly held a lengthy, tense conversation with top British leadership, telling them, “You are helping Smotrich.” During the call, a senior British official expressed surprise that the Israeli government had done nothing meaningful to prevent the sanctions in advance. Lapid’s response was sharp: “Of course, because they knew it was good for them politically.”
• In a separate statement, Lapid referred to the UK decision as a, “grave mistake… a flawed and dangerous policy, at the wrong time and for the wrong reasons,” which would strengthen extremist voices in Israel and serve as a “shot in the arm for Hamas and terror organisations.”
• According to Israel’s Ministry of Economy, total Israeli exports to the whole world in 2025 stood at around $165 billion, while trade with the UK accounted for $4.4 billion, with exports from the West Bank making up only around 1 per cent, primarily dates from the Jordan Valley.
• However economists are concerned of a knock on effect, where doing business with Israel becomes too complicated with most Brits not knowing the contours of the Green Line.
• Since the UK’s unilateral recognition of Palestinian statehood in 2025, its consulate in East Jerusalem has functioned as its de-facto embassy to Palestine. Its closure could now lead to the establishment of an embassy in Ramallah.
• The termination of British Support Team in Ramallah is significant. This was the most senior international interface with the Palestinian security forces, that despite the ongoing tension on the ground, kept discreet coordination with the IDF.  
• None of those banned are senior members of the Labour Party who were involved in drafting yesterday’s policy announcement, instead representing the party’s hard-left anti-Israel wing, the Green Party, or in Jeremy Corbyn’s case Your Party.
• Those banned have broadly responded positively. Taking to Twitter, Zarah Sultana MP described Israel’s measures as a “badge of honour” she would happily wear, while the Green Party responded by saying that it “will not be bullied into silence.”
• Mainstream Anglo-Jewish leaders have strongly condemned the new policies. The Chief Rabbi, Sir Efraim Mirvis, accused the British government of overlooking communal concerns, saying that “Gesture politics of this kind feeds into an increasingly hostile discourse about Israel, and the cumulative effect of such punitive policies is to further embolden those, at home and abroad, who use hatred as a weapon against Jews.”
• The Jewish Leadership Council said that “the government’s increasingly punitive and unbalanced approach towards Israel does nothing to advance peace, risks harming Jewish life in Britain, and damages the UK’s relationship with a vital ally”, and that “A ban on trade with goods from settlements also risks becoming a de facto boycott of Israel, giving legitimacy to those who reject Israel’s very existence.”
• Whilst many have raised concerns about the timing of the announcement, it has also been noted that if the UK government were truly concerned about the situation in the West Bank and Gaza, they would expedite the proposed six to nine months’ timeframe announced in Parliament.  Supporting the claim that this policy is performative and will have little impact in these territories.

Looking ahead: From the UK’s perspective, the announcement was a declaration of intent rather than an immediate move. Miliband plans to advance new legislation that will take effect only in six to nine months.

• However according to Saar the removal of the British representatives (listed above) will take place in the next week.

“It is deeply disappointing that the UK government has chosen performative actions to suit its own domestic needs over responsible diplomacy, especially during the sensitive period in the lead up to an Israeli election. The UK’s sanctions risk emboldening the most radical elements in Israeli politics. While the government claims that a two-state solution is its aim, these sanctions directly hinder progress towards that goal.

“The sanctions are harming not just innocent Israelis but the estimated 20,000 Palestinians currently working in various Israeli businesses in the West Bank, and their livelihoods are threatened by the UK’s actions.

“The new government policy also weakens the UK’s influence in the region and undermines its ability to serve as an honest broker in any potential peace process between Israel and the Palestinians.

“In this light, the UK’s latest policy towards Israel is an act of political posturing against a critical trade and security partner, disregarding our own national interests. Where previously issued, such sanctions had no moderating effect on the Israeli individuals or businesses concerned. It is highly unlikely that those just announced will have the desired effects.”

– Richard Pater, BICOM Chief Executive

What’s happened: Foreign Secretary Ed Milliband announced a package of measures targeting Israel.

• The measures specifically target trade with Israeli settlements in the West Bank and, by extension, with Israel in general.
• Miliband’s announcement follows calls from Labour activists, including more than 140 Labour MPs, to ban trade with Israeli settlements, with campaigners preparing a motion to be tabled at the Labour Party Conference later this month.
• At the same time, Miliband’s policy faced opposition from Labour Friends of Israel, which warned that the measures risk becoming a “de facto boycott” of Israel.
• Similar point was raised by Conservative Friends of Israel, whose Parliamentary Chair Greg Smith marked today “a dark day in the history of British foreign policy” and warned that “this will only pour petrol on the fires of anti-Jewish hatred which have spread at such an alarming rate in recent years.”
• According to president Isaac Herzog, the UK policy is “a grave miscalculation, a decision that will fall on the wrong side of history.” Herzog also pointed out that sanctions will negatively impact Palestinians themselves: “It will directly harm – unfortunately – Palestinians, robbing them of business and employment.”
• Currently, around 20,000 Palestinians work in various Israeli businesses in the West Bank, and sanctions will directly affect their livelihoods.
• Today’s sanctions mark the eighth time that the UK has announced punitive measures5(11.1%) against Israel since the war began with Hamas’s invasion and massacre on 7 October 2023. No comparable measures have been taken by the UK against the Palestinians during the same period. With this one-sided approach, Britain undermines its ability to serve as an honest broker in any potential peace process between Israel and the Palestinians.

Context: In the days before being elected Labour leader in July, Burnham made a public “apology” for the Labour government (of which he was not a member) having “got it wrong” on Gaza in its initial response to the Hamas massacre of October 7.

• Burnham criticised the outgoing Starmer government for not putting more pressure on Israel in the initial days of the war to accept a ceasefire.
• The two issues that precipitated public disputes between London and Jerusalem were the E1 construction tenders and the humanitarian situation in Gaza.
  • On E1, the UK, together with many allied governments, has claimed that the settlement would effectively cut the West Bank in two and irreversibly prevent the establishment of a contiguous Palestinian state, neither of which is an empirically sustainable claim. E1 is west of Maaleh Adumim, which has been included in Israeli territory in all proposed peace plans in the past three decades, and the remaining corridor of land is roughly 25 km wide. For comparison, the inclusion of Tulkarem in a future Palestinian state, which all proposed peace plans also stipulate, leaves central Israel a corridor of barely 15km without anyone claiming that it cuts the state in two or prevents territorial contiguity. Secondly, every single proposal since and including the 1947 UN Partition Plan has envisaged a Palestinian state with non-contiguous territory, with the Gaza Strip as its exclave.
  • Data on the humanitarian situation in Gaza just from the last weeks has shown definitively that there is no shortage of food or medical supplies. Claims made in a social media video by Foreign Secretary Milliband earlier this week where he describes learning in a meeting with NGOs about restrictions on medical supplies were refuted by Israeli authorities who noted that there has been no restriction of any kind on medical supplies since the ceasefire came into force a year ago, and in fact the UK is an active member in the CMCC mechanism which oversees the transfer of these supplies.
• Beyond these two issues, the larger motivation for the new UK policy reset is the ostensible need to preserve the two-state solution and act against parties working against it.
  • The acceleration of so-called “outposts” in the West Bank, particularly since the October 7 massacre, do seem intended to make future Israeli withdrawals from the territory more onerous. But it’s not entirely clear how, if a peace treaty were reached, they could actually fulfil that purpose. Israel has withdrawn from much bigger and more populated settlements in the past, both in Sinai and Gaza, as well as in the northern West Bank in 2005. And in final status talks at the end of the Oslo process, it offered to withdraw from much larger settlements to achieve a two-state peace accord, but these withdrawals never came to pass not because of settler opposition but because of Palestinian rejection.
  • The argument that settlements must be boycotted because any claim that Jews should live in the West Bank imperils the prospect of two states is substantially weakened by the insistence on funding UNRWA, the UN-backed Palestinian agency that treats Palestinians living in the West Bank or Gaza as “refugees” from what is today Israel. And yet, support for UNRWA has become a central plank of this government’s position on the conflict since 2024.
  • Rather than address the actual reason a two-state solution has not been effected — namely, that at each opportunity to establish their state, the Palestinians have rejected peace and sought violent confrontation instead — the reset seeks to take a tough stand against an imagined cause for this impasse. And in so doing, whether intentionally or not, the government is effectively rewarding rejectionism and implicitly awarding a prize for the October 7 attack.
• Israeli commentators have tended to see the announced British move as a boon to the right and far-right in Israel’s heated election campaign, leading up to the first general election since the October 7 massacre in seven weeks time. The actual impact on the election will probably be limited.
• But it will burnish two major right-wing arguments, and at a rather awkward time for domestic Israeli opponents of the settlement enterprise.
  • The issue of settler violence in the West Bank had begun to capture headlines in Israel in recent weeks and had put the settlers on the wrong side of public opinion. The UK moves against all settlements — and especially the likely inclusion of East Jerusalem in the trade ban — effectively undo that. To the extent the issue of the settlements is one of armed gangs harassing Palestinian shepherds (and interfering with IDF operations in the West Bank), it becomes an issue where the vast centre of Israeli politics is opposed. If the issue is Israelis living in what as seen as sovereign Israeli territory in Israel’s capital city or doing business with firms that operate both in pre-1967 Israel and settlements on the Green Line that are to be annexed to Israel in any proposed peace plan, that same broad centre lands on the other side.
  • The connection between settlements and two states or settlements and the war which was launched on October 7 doesn’t play out domestically in Israel the way it appears to in Whitehall. The invasion of Israel and the worst massacre of the Jewish people since the Holocaust didn’t occur from a contested land dotted with settlements. It came from Gaza, where there was no Israeli military presence and not a single settlement or settler since 2005. The unavoidable empirical connection made by Israelis is that where settlers and the IDF stayed, no such massacre and invasion was mounted, and where they left, two decades of rocket fire ensued culminating in the October 7 massacre and long war since.
• In response to UK sanctions, the UK will almost certainly be removed from the International Gaza Support Centre (still generally referred to by its old name the CMCC), the multinational body based in Kiryat Gat, Israel, which coordinations stabilisation and relief efforts in Gaza in line with the October 2025 ceasefire.
  • The CMCC is the International organisation overseeing the provision of humanitarian aid into Gaza, and its staff include civilian and military personnel from multiple countries, including Switzerland, Japan, Australia, Canada, Egypt, Jordan, the UAE, Denmark, Cyprus, Greece, New Zealand, and others.
  • Israel has previously expelled personnel from Spain and the Netherlands for diplomatic moves that were less extreme than those being announced in London today, so it is unlikely that Israel will continue to host the UK at the facility.
  • Israeli anger at the UK on the specific issue of CMCC participation was already piqued earlier in the week when Foreign Secretary Miliband made false claims about Israel blocking medical supplies to Gaza, despite the UK’s active participation in the relevant CMCC working groups that oversee the provision of medical supplies.
• Other direct responses from Israel are under consideration in Jerusalem. These include shutting down the UK consulate in East Jerusalem which functions as a de facto embassy to the Palestinian Authority, despite being located outside any territory governed by the PA. For comparison, the UK does not have an embassy to Israel anywhere in Jerusalem, but rather in Tel Aviv.
• Israel may also suspend the export of certain weapons systems to the UK. The UK today purchases from Israel Trophy Active Protection System for its Challenger 3 tank, missile defence systems, electronic warfare technology, and a variety of unmanned and autonomous devices.
• Both the UK and Israel are major participants in the multinational program developing the F-35 fighter jet, and even in previous steps the UK has taken against Israel, action on this specific form of defence cooperation has been limited. It is rumoured that Israel might ask the US to find Britain in breach of its commitments to the program due to the limited export license removals for F-35 parts, though it is not clear the US would be inclined to agree with this.
• More extreme proposals included a call by Otzma Yehudit leader Itamar Ben-Gvir to respond by recognising Argentine sovereignty over the Falkland Islands. This hard-line rhetoric is highly unlikely to be adopted by decision-makers in Jerusalem.
• On the other hand, domestic American law places limitations on the doing business with firms that cooperate with boycotts of Israel. These vary state-by-state, but any broad to ban trade with Israeli firms that have business in the settlements (which is most Israeli firms, especially if East Jerusalem is considered a “settlement”) could have far-reaching implications on British business in the US, particularly in the two large states of Florida and Texas.

Looking ahead: It is virtually impossible to distinguish goods made in Israel from those made in settlements, however these are defined, as supply chains normally involve actors from both. Making the distinction with regard to services too is even more difficult. A policy that is more than symbolic will inevitably lead to a rollback of trade with Israel as a whole, and many British firms seeking to avoid legal difficulties will protect themselves by stopping business with Israel.

• If the announcement is purely symbolic and will ultimately have no effect on trade relations with Israel at all, it will only serve to heighten the rhetoric against Israel and further the demonisation of Israel’s self-defence as criminal. It is precisely this rhetoric, and the extended permission structure that attends it, that has accompanied the dramatic uptick in antisemitic violence and harassment faced by the British Jewish community in the last three years.
• This move might be more dramatic than some of the other announcements of the past three years, but it continues a consistent direction of UK policy since war erupted on October 7 — a direction that has sought to limit Israel’s capacity to self-defence and use the violence of the last three years to entrench real political gains for the Palestinians. It is unlikely that any future Israeli government will see a major role for Britain in any future peace process, should one ever get underway.
• This early pronouncement and the new reset, a month before the Holborn & St Pancras by-election, where a Labour seat is at risk from a Greens who have made criticising Israel a focal point of their campaign, are an indication of how the new Government seeks to make strong stands against Israel a part of its domestic posture rather than risk bleeding more constituencies to independent or Green candidates.