EU warns Israel over anti-NGO bill

"We are following with extreme concern the debate in the Knesset over this draft legislation to oblige Israeli NGOs to make public any funds received from foreign governments," he told MEPs.

"We have made our concern clear on several occasions to the Israeli government."

The bill, which in its original form would have revoked the tax-exempt status of groups that received funding from foreign governments has been slammed by Israeli human rights and civil liberties organisations as ‘McCarthyist' and compared the legislation to laws restricting NGO activities enacted in Russia and Iran.

The legislation requires that any spokesperson of an NGO declare in all public appearances that they receive funding from a "foreign political entity". Non-compliance would result in fines or imprisonment.

The EU has taken a particular interest in the bill as the country's human rights groups receive a great deal of their funding from the bloc.

A revised version of the legislation has dropped the most controversial elements, notably the revocation of tax-exempt status and a requirement that groups report to the registrar of political parties.

Mr Fuele acknowledged there had been improvements to the bill, but still said the legislation placed an onerous burden on civil society groups.

"We believe the demand for transparency from the NGOs remains too demanding," he said.

"The new criteria for transparency solely concerns public finance, which would be discriminatory vis-a-vis those working with public funds, notably those from the EU."

According to the Association for Civil Rights in Israel, the law is redundant as existing legislation requires that groups already disclose funding sources on their websites and annual reports.

The ACRI also says that the bill is selective in that it requires only reporting of public funding rather than funds from private foundations. Israeli human rights groups tend to receive funding from public sources while conservative Israeli organisations and think-tanks supporting settlements in the occupied Palestinian territories tend to receive funding from private American Jewish and Christian foundations.

The group urges the legislation be dropped, or "to amend the bill by requiring full transparency of all types of organisations regarding all the sources of their foreign funding, not limiting the expanded reporting requirements only to funds received from foreign state entities."

The sponsor of the bill, Likud MK Zeev Elkin has said the law is intended to stop another ‘Goldstone Report' from recurring, referring to a UN investigation that was critical of the 2009 Israeli assault on the Gaza Strip that killed some 1400 civilians.

According to Mr Elkin, the bill aims "to prevent a recurrence of the Goldstone report, which is mostly based on material provided by Israeli organizations ... financed by foreign states. The NGOs sometimes co-operate with foreign bodies that use them to infiltrate messages or acts opposed to Israeli interests."

Gerald Steinberg, head of NGO Monitor, an Israeli-government-linked group that supports the bill and has accused Amnesty International, Human Rights Watch and Oxfam and other NGOs of engaging in what he calls "third-generation warfare" against Israel, said the EU was focussing on an "outdated" version of the law.

"We fear that the European Parliament is holding a debate based on a misleading premise," he said in a statement. "Many rumours have surrounded this legislation, but as the text currently stands, this bill simply ensures that Israeli citizens know the funding sources of the many NGOs that operate here."