MEPs split on EU-Israel trade deal

The decision - which now goes to plenary in October - came despite a proposal by the committee chairman, Portuguese centre-left MEP Vital Moreira, to suspend the deal for two years in light of "the Union's firm condemnation of Israeli policy vis-a-vis the Palestinians, namely in what regards the Gaza economic blockade, which amounts to a collective punishment."

The trade agreement, which deals with the conformity of industrial products with EU standards, is open to all EU neighbouring countries.

But some MEPs say it could help Israel to sell items made in occupied Palestinian territories, further damaging the prospect of a future Palestinian state.

Its opponents remain optimistic the deal will be blocked in plenary.

Following the vote, the Socialist group said it would table an "interpretative declaration" to be attached to the pact to underline that settlement goods cannot be "lawfully traded" as part of the agreement.

Moreira's report noted that parliament has in the past blocked a number of EU-Israeli accords for the sake of the Middle-East peace process.

The committee chairman on Tuesday again said that "de facto" upgrading relations with Israel at this time is not appropriate.

The EU agreed its first bilateral trade deal with Israel back in 2000 and is Israel's main trading partner with total trade between the two worth about €30 billion in 2011.

Plans for upgrading EU-Israel diplomatic relations were frozen by Brussels in 2009 following Israeli attacks on the Gaza strip.

EU foreign ministers in July unfroze the upgrade. But the European Commission and the EU foreign service are currently drafting an EU-level code of conduct for consumer labels of settlement products.

The UK already has labels and Denmark is planning to introduce them shortly. In August, South Africa's decision to label products provoked a diplomatic row with Israel.

When contacted by EUobserver, an Israeli embassy spokesman played down the importance of the parliament vote.

He described it as "a welcome albeit a belated development," adding that it was "another step forward toward the ratification of a technical trade agreement that will benefit both Israeli and European consumers of pharmaceutical products."

He noted that "this agreement does not represent any kind of upgrade of EU-Israel relations, as we are merely talking about the entry into force of an agreement signed already in 2010."