German Bundestag

17th electoral term

Printed Paper 17/10353

19 July 2012

Answer of the Federal Government to the Minor Interpellation tabled by the Members of the German Bundestag Annette Groth, Wolfgang Gehrcke, Jan van Aken, further Members and the Left Party parliamentary group
Bundestag Printed Paper 17/10205

Labelling of products from settlements in the territories occupied by Israel in 1967

Since 1995, the European Union (EU) has granted Israel preferential tariff treatment on goods of Israeli origin imported into EU countries. The legal basis for this arrangement is the Association Agreement concluded between the EU and Israel, similar to those adopted between the EU and almost every Mediterranean country within the framework of the Euro-Mediterranean Partnership. Pursuant to Article 2 of this Agreement, all the EUs partners must respect human rights and democratic principles (human rights clause). This clause is defined as an essential element of all the Agreements. Israeli settlements in the Palestinian territories occupied in 1967 are unlawful under international humanitarian law: they contravene Article 49 of the Fourth Geneva Convention. In its Advisory Opinion of 9 July 2004, the International Court of Justice (ICJ) confirmed that these settlements have been established in breach of international law. The Federal Government has also repeatedly stated that it considers Israels settlements in the occupied territories to violate international law. Accordingly, it makes a distinction between the territory of the State of Israel and the territories occupied in 1967. In the Israeli settlements established in breach of international law, goods are produced for export, inter alia to Germany. However, these products are not labelled by the Israeli customs authorities as products from the occupied territories, but are exported to Europe under the Made in Israel label. It is impossible to determine from the label whether the goods were produced in Israel or in the occupied territories.

The Reply was transmitted on behalf of the Federal Government with a letter from the Federal Ministry of Finance dated 13 July 2012. The Printed Paper also contains the text of the questions in smaller type.

As a consequence, since the EU-Israel Association Agreement entered into force, this has given rise to a practice which, although tacitly accepted, is nonetheless illegal: products from the occupied territories have benefited from the preferential tariff treatment in the same way as goods from Israel. Faced with growing criticism of this situation, the EU Member States secured a pledge from the Israeli Government that it would henceforth require its exporters to provide additional information about their export products. At the end of 2005, an informal Technical Arrangement entered into force; all proofs of preferential origin covering imports from Israel must indicate the imported goods place of production and an accompanying postcode. This enables the European customs authorities to distinguish between products from the territory of the State of Israel and those originating in settlements established in breach of international law, and to refuse preference to goods produced in these settlements. In its judgment of 25 February 2010 (C-386/08), the European Court of Justice ruled that such an approach by the European customs authorities is lawful and that the EUs preferential tariff arrangements granted for products originating in Israel do not apply to products originating in illegal settlements. Prior to this clarification of the legal position, the UK Government, in December 2009, had already issued packaging guidelines for British companies which state that labels should distinguish between goods produced by Palestinians in the occupied territories and products from Israeli settlements, the aim being to give consumers the opportunity to decide for themselves whether they wish to purchase goods from settlements which are illegal under international law. At the end of May 2012, the Governments of South Africa and Denmark announced plans for the correct labelling of settlement products; these can no longer be sold under the Made in Israel label. Several weeks ago, the Swiss supermarket chain Migros also backed critical consumers when it announced plans to introduce a labelling scheme, stating that consumers have a right to know where the items originate from. Products from settlements will be identified precisely as either made in Israel or made in the Israeli settlement area. No such labelling has been introduced in Germany as yet. Non-governmental organizations have repeatedly urged the Federal Government to introduce labelling of products from the occupied territories in Germany as well. In April 2010, the German section of International Physicians for the Prevention of Nuclear War (IPPNW), a global federation of medical organizations, called for mandatory labelling of goods from settlements in the Israeli-occupied territories. In May 2012, Pax Christi launched its Occupation tastes bitter initiative and encourages consumers not to buy foods which may be settlementproduced.

The Reply was transmitted on behalf of the Federal Government with a letter from the Federal Ministry of Finance dated 13 July 2012. The Printed Paper also contains the text of the questions in smaller type.

The existence of Israeli settlements in the territories occupied by Israel in 1967 poses a significant obstacle to a just peace in the Middle East. In order to strengthen the forces in Israel and the Palestinian territories which are working through non-violence for an end to the occupation and for a just peace in the Middle East, consumers should refrain from purchasing goods produced by companies based in the occupied territories. Companies are free to choose where to invest and engage in production. Until now, it has been highly profitable for them to set up production sites in illegal settlements as they receive preferential treatment from the state for doing so. For these companies, their participation in the violation of international law has no practical consequences. This could provide a starting point for critical consumers to make purchase decisions which are guided by respect for international law. This is possible if they have the requisite information available to them. In its Advisory Opinion in 2004, the ICJ also recalled the third-country obligations of all States parties to the Fourth Geneva Convention. Under this Convention, all the European states have an obligation to ensure that international humanitarian law is respected and implemented in Israel and the occupied Palestinian territories.
1. Does the Federal Government intend to introduce labelling of products originating in the territories occupied by Israel in 1967? If so, when, and in which form? If not, why not?

No. The labelling requirements for products originating in the territories occupied by Israel in 1967 are based on European Union (EU) law. Under an administrative arrangement between the EU and Israel relating to consignments of goods from Israel, all movement certificates EUR.1 and invoice declarations issued or made out in Israel must bear the name of the city, village or industrial zone where production conferring originating status has taken place. In the conclusions of the Foreign Affairs Council meeting on 14 May 2012, the Council of the European Union reaffirmed the commitment of the EU and its Member States to fully and effectively implement existing EU legislation and the bilateral arrangements applicable to settlement products. The Council underlined the importance of the work being carried out together with the Commission in this regard.
2. In the Federal Governments view, is there any legal reason to prevent products from the occupied territories from being labelled as such? If so, what is the reason?

There is no obvious legal reason for a prohibition of this nature. The competencies of the EU must be respected.
The Reply was transmitted on behalf of the Federal Government with a letter from the Federal Ministry of Finance dated 13 July 2012. The Printed Paper also contains the text of the questions in smaller type.

3.

Does the Federal Government share the view that the labelling of products from illegal settlements would enable it to fulfil its own legal obligation, arising under the Fourth Geneva Convention, to ensure that international law is respected and implemented? If so, why has labelling not been introduced already? If not, why not?

A product labelling requirement does not arise under the Fourth Geneva Convention of 1949, nor from the 1907 Hague Convention respecting the Laws and Customs of War on Land or customary international law. Attention is also drawn to the answer to Question 14.
4. How often and in which specific cases, according to the Federal Governments information, have the German customs authorities refused to grant preferential treatment to settlement products?

Import clearance in Germany is IT-supported; the ATLAS Automated Customs Tariff and Local Processing Application System is specifically designed to check compliance with the provisions of customs legislation and the related data collection and information requirements and to ensure that customs procedures are as efficient as possible. This system does not allow automated analyses to be carried out separately beyond the parameters of what is required for legally compliant and efficient customs clearance. An analysis of the immense data stock, most of which is held in an archived database, cannot be generated directly from the available datasets of relevance to this particular question. That being the case, no relevant information is available.
5. Does the Federal Government share the view that European consumers are boosting the profits of production sites in illegal settlements if they purchase goods from these settlements?

The profitability of production sites depends on a multitude of factors such as wage, input and financing costs, taxes, subsidies, etc. It is therefore not possible to comment on the extent to which the consumption of goods from specific regions affects their profitability.
6. In the Federal Governments view, does the marketing of settlement goods as originating in Israel give suppliers of these goods an unfair competitive advantage, as this label is likely to influence a customers purchase decision without their full knowledge of the actual origin of the products concerned? Does the Federal Government consider it permissible, in terms of consumer protection, to withhold from consumers information which would enable them to make an informed purchase decision about goods produced under conditions which violate international law?

7.

Question 6 and Question 7 are factually related and are therefore answered jointly.

Sections 3 and 5 of the Act Against Unfair Competition (Gesetz gegen den unlauteren Wettbewerb) regulate inter alia the protection of
The Reply was transmitted on behalf of the Federal Government with a letter from the Federal Ministry of Finance dated 13 July 2012. The Printed Paper also contains the text of the questions in smaller type.

consumers against misleading commercial practices. It is a matter for the courts to decide, on a case-by-case basis, whether a commercial practice is misleading. The Federal Government has no information available as to whether the labelling of a product from the occupied territories as Made in Israel is likely to prompt customers to make a purchase decision that they would otherwise not have made. 8.
a) Does the Federal Government have any information available indicating how many people in Germany at present generally refrain from buying products labelled Made in Israel due to the risk that their purchase could support illegal settlements?

No.
b) Does the Federal Government share the view that labelling of goods produced in illegal settlements would enable German consumers who wish to buy products from Israel to do so without running the risk of unwittingly supporting illegal settlements? If not, why not?

Please refer to the answer to Question 7.

9. To the Federal Governments knowledge, how many Israeli companies which market their goods in the EU have production facilities in the occupied territories? Which companies does this apply to? (Please attach a complete list).

The Federal Government has no relevant information available. 10.

a) What information is available to the Federal Government regarding reports that the Israeli Government has allegedly set up a fund in order to compensate firms based in the West Bank for any tax payments that they may be required to make?

In December 2009, the European Commission advised that shortly after the entry into force of the administrative arrangement between the EU and Israel for the implementation of the EU-Israel Association Agreement, the Israeli Ministry of Industry, Trade and Labor introduced a scheme to compensate exporters whose exports to the EU do not benefit from preferential tariff treatment under the Association Agreement.
b) To the Federal Governments knowledge, how much funding has been provided by the Israeli Government for this purpose, as compared with the revenue generated for Israel from its exports to Europe?

The Federal Government has no current information available on this issue.

11. Does the Federal Government have any information as to whether companies which are based in Israel but also produce goods in the
The Reply was transmitted on behalf of the Federal Government with a letter from the Federal Ministry of Finance dated 13 July 2012. The Printed Paper also contains the text of the questions in smaller type.

occupied territories label their export products from the occupied territories with the postcode of their site in Israel itself?

The Federal Government has no information available on this issue.

12. According to the Federal Governments information, what percentage of goods exported by Israel to the EU originates in the occupied territories? 13. Which goods from the occupied territories does this apply to (please provide an exact breakdown, specifying the type of product, its precise origin, and its percentage share of Israeli exports to Europe) and which of these goods are imported into Germany?

Question 12 and Question 13 are factually related and are therefore answered jointly. The Federal Government has no relevant statistical data available.
14. Does the Federal Government share the view that the constant misapplication of the EU-Israel Association Agreement is causing material damage to the EU budgets and to producers in EU countries? If not, why not? If so, why is the EU still actively pursuing a policy which is designed to protect Israel from the legal consequences of actions which are in breach of international law?

The Federal Government does not endorse the judgement underlying the question. Furthermore, according to statements made by the European Commission, the application of the administrative arrangement in force between the EU and Israel since 2005 is generally satisfactory in ensuring that goods produced in the occupied territories do not benefit from preferential tariff treatment under the EU-Israel Association Agreement. Moreover, in the conclusions of the Foreign Affairs Council meeting on 14 May 2012, the Council of the European Union reaffirmed the commitment of the EU and its Member States to fully and effectively implement existing EU legislation and the bilateral arrangements applicable to settlement products and underlined the importance of the work being carried out in this regard.
15. What is the Federal Governments assessment of the fact that the tacit acceptance by many governments and by the United Nations Security Council of the Israeli Governments serious breaches of international law is regarded by many human rights organizations in the region as a major factor exacerbating the conflict?

The Federal Government and the European Union have stated their position on the Israeli-Palestinian conflict publicly on many occasions, e.g. in the conclusions of the European Unions Foreign Affairs Council meeting on 14 May 2012. The Federal Government also takes account of the assessments provided by human rights organisations and other non-governmental organisations as a source of information when formulating its foreign policy.
16.
The Reply was transmitted on behalf of the Federal Government with a letter from the Federal Ministry of Finance dated 13 July 2012. The Printed Paper also contains the text of the questions in smaller type.

a) Does the Federal Government consider that Israels internal and international policy is based on respect for human rights which, pursuant to Article 2 of the Association Agreement (human rights clause), constitutes an essential element of this Agreement?

The Federal Government monitors the human rights situation in Israel attentively, intervenes where appropriate and opportune on a regular basis with the tried and tested instruments available to it, and engages in close coordination with its EU partners. The Federal Government takes the view that the cooperation and dialogue mechanisms established in particular on the basis of the EU-Israel Association Agreement, including the Informal EU-Israel Working Group on Human Rights, are appropriate forums in which to address human rights issues with Israel and make them the subject of broader political dialogue with Israel.
b) Does the Federal Government share the view that the violation of Article 2 of the EU-Israel Association Agreement by the Israeli Government must have consequences? If not, why not? c) If so, why has the violation of Article 2 not led to any consequences to date? d) Which consequences are conceivable in future, from the Federal Governments perspective?

The Federal Government does not endorse the assumption, implicit in the questions, that a violation of the EU-Israel Association Agreement has occurred.

The Reply was transmitted on behalf of the Federal Government with a letter from the Federal Ministry of Finance dated 13 July 2012. The Printed Paper also contains the text of the questions in smaller type.