EU punishes Israel on settlements, rewards it on UN club

The grants will be governed by new EU guidelines, which say Israeli firms and institutions cannot spend a cent of EU money on activity in occupied Palestinian land.

Contacts familiar with the MoU text told EUobserver it will include an appendix saying Israel does not recognise the guidelines.

But they described the appendix as "futile … a fig leaf."

They said the Horizon 2020 "work programme" and "calls for proposals" - which detail implementation - will oblige Israeli entities to comply with the guidelines if they want EU cash.

Crucially, the European Commission will also send Israel a notification on the implementing documents.

The legal notice means Israel will not be able to challenge Horizon 2020 eligibility criteria in the EU court in Luxembourg and Israeli entities will not be able to challenge them in Israeli courts.

The EU went some way to help Israel save face.

It agreed to the Israeli appendix.

It is keeping quiet on the work programme and legal notification issue.

EU officials also agreed to let Israel break news of the accord in Israeli media so they could spin it as a "compromise" in which Israel won "concessions."

Israel spends a tiny fraction of EU science funds in occupied zones.

But after years of verbal criticism, the Horizon 2020 deal represents the Union's first legal blow against settlement expansion.

It also creates a precedent for EU grants in other sectors for the next seven years.

"This agreement will pave the way for Israel's participation in other EU programmes to be launched from 1 January 2014," the two sides said in a joint statement on Tuesday (26 November).

Israeli spin backfires

EU diplomats told this website that Israeli PR made the EU less flexible than it might have been.

The EU commission, at one point in the talks, wobbled on the legal notification issue.

But a series of leaks by Israeli officials to Israeli media saying EU negotiators had agreed to water down its new regime prompted Arab diplomats, pro-Palestinian NGOs, MEPs and European politicians to deluge EU institutions with complaints.

"The lesson is that even if you are speaking to your domestic audience, your enemy is also reading the press," an EU source told this website.

"We had an unprecedented number of high-level letters, meetings, which made it very tough for the EU to back down," he added.

Other Israeli efforts were equally counterproductive.

On Monday, the eve of the Horizon 2020 deal, Israel sent major general Eitan Dangot to talk to EU diplomats in an EU Council working group on the Middle East.

Dangot, the head of Cogat, a branch of the Israeli defence ministry responsible for the occupied territories, showed EU diplomats a slide presentation of Palestinian children with AK47s designed to demonstrate that Palestine does not want a peace deal.

He said Palestinians should be "grateful" for the occupation because Israel builds them schools and other facilities.

Dutch and Swedish delegates complained, saying Israel has destroyed dozens of EU-funded projects in Palestine.

"The more I listen to this kind of thing, the less sympathy I have for the Israeli point of view," another EU diplomat who met Dangot told this website.

The EU's hard line on settlements does not mean it is not giving Israel what it wants in other areas, however.

Quid pro quo

Also on Tuesday, EU states, the US and Turkey in the "Western European and Others Group [Weog]" at the UN office in Geneva agreed to let Israel become a fully-fledged member.

Weog co-ordinates voting positions and holds internal debates, in a similar way to political groups in the European Parliament.

The move comes despite the fact that in 2009 EU states froze plans for a "diplomatic upgrade" in EU-Israel relations, part of which included Weog membership in Geneva.

EU foreign relations chief Catherine Ashton told MEPs in September the freeze is still in force.

But a diplomat from one EU country told EUobserver that many EU capitals have "forgotten" their 2009 decision.

"Four years is an eternity in diplomatic life," he said.

He noted that Germany pushed for the Weog move in order to compensate Israel for the settlement funding rules.

"It's a clear breach of the upgrade freeze. But there is a broader mindset in which the EU is afraid of its own shadow on Israel, and it has certainly cast a shadow with the new guidelines," he added.

An Israeli diplomat told EUobserver: "We don't see any connection between Weog and the guidelines."

The German foreign ministry declined to comment.