Israeli Settlements: Trade Ban

Debate between Adnan Hussain and Naz Shah

Thursday 9th July 2026 Commons Chamber

[Naz Shah (Bradford West) (Lab)]

I want to start by putting on record my thanks to my hon. Friend the Member for Sheffield Central (Abtisam Mohamed) for bringing forward this important debate. I congratulate her on her tremendous, very passionate speech.

I am grateful to all Members who have outlined the legal position. We know that Ireland has passed a Bill banning products from illegal settlements, as has Spain, and Belgium is pushing to do the same. I am going to bring Members right back to the common-sense argument. The case put forward this week by the Irish Parliament was clear: goods should not enter freely into commercial markets, as doing so would allow illegal goods and services to be transformed into legal entities in Ireland. That is the crux of it for me, and it is that premise that has been highlighted in expert legal opinions by Richard Fisher KC and Rabah Kherbane of Doughty Street Chambers. They say that there is a legal basis under domestic UK law for prosecuting the trade of goods from Israeli illegal settlements into the UK and that it amounts to production under part 7 of the Proceeds of Crime Act 2002.

The decision not to ban these products seems driven less by genuine legal application than by how such a position might be politically received by Israel. Fundamentally, the question is not about trade with Israel but about trade with illegal settlements in illegal occupied territories and a matter of international law.

[Mr Hussain]

Does the hon. Member agree that the ICJ advisory opinion leaves the decision not as a political one but as a legal one? In respect of domestic law, we know that the Government accept the illegal settlements. Therefore, under the Proceeds of Crime Act, if the Government do not make a firm decision, are they not putting our financial institutions at risk?

[Naz Shah]

I thank the hon. Member for his comment. I was going to come to that in my speech, but I am having to miss lots out because of the time limit.

Currently, the UK Government strongly advise against conducting any economic and financial activities in illegal Israeli settlements, including financial transactions, investments, procurement and other economic activities. The Government confirm that that has legal and economic risks according to international law.

Here is the thing: so long as consumers are aware that goods originate from Israel’s illegal occupation of Palestinian land—according to international law, illegal settlements amount to war crimes—and are illegal produce, they can choose whether they want to buy the goods or not. Let me spell this out. If something is grown on stolen land, which is recognised as illegal by our Government and recognised to pose legal risks as proceeds from stolen land, so long as those goods are clearly and correctly labelled as “stolen goods”, they can legally be sold in Asda, Morrisons, Tesco or even Marks & Spencer.

Imagine if we were to apply the same principle in the UK to ordinary citizens. It would suggest that so long as a product or good is labelled, even if the product is linked to criminal property, it is fine. In fact, one could go even further and argue that if Asda, Morrisons, Tesco or any other supermarket were to sell stolen TVs, for example, so long as they labelled them “possibly stolen”, and businesses were warned of the legal and economic risks, it would be fine to buy one from the local supermarket. That is the bottom line: the consumer has the knowledge, and the authorities are happy to turn a blind eye.

We cannot continue to turn a blind eye to the annexation and terrorism that the Palestinians are facing from terrorist settlers. Make no mistake, this is a state-sanctioned occupation and annexation of Palestinian territory. We cannot and must not stand by, because history will not be kind to us.