DaysOfPal — The European Council has called on Israel to immediately halt settlement expansion in the occupied West Bank and cancel a construction tender for the controversial E1 project, warning that companies and financial institutions involved in Israeli settlement activities could face legal, economic, and commercial consequences.

In a statement issued Saturday following its meeting, the Council demanded the "immediate reversal" of recent Israeli decisions to advance settlement construction, specifically calling for the withdrawal of the E1 building tender.

The Council also cautioned businesses and financial institutions against participating in the E1 project or other Israeli settlement activities in occupied Palestinian territory, warning that such involvement could carry significant legal and financial risks under international law.

The warning comes amid longstanding international opposition to the E1 project, which threatens to further fragment the occupied West Bank and undermine the territorial continuity of Palestinian communities.

E1 Project Threatens to Divide the Occupied West Bank

The E1 project involves Israeli settlement construction in an area between occupied Jerusalem and Ma'ale Adumim, one of the largest Israeli settlements in the occupied West Bank.

The proposed development would expand the settlement corridor connecting Ma'ale Adumim to Jerusalem, creating a major obstacle to Palestinian territorial continuity.

Critics warn that construction in E1 would further separate Palestinian communities in the northern and southern West Bank and severely restrict the geographic connections between Ramallah, occupied Jerusalem, and Bethlehem.

The European Council warned that the project would undermine prospects for a "viable, independent and contiguous Palestinian state."

The plan has faced opposition from the European Union and much of the international community for more than two decades because of its implications for Palestinian movement, development, and territorial integrity.

Companies Warned Against Involvement in Israeli Settlements

The Council's statement extended beyond demands directed at Israeli authorities, warning private companies and financial institutions about the consequences of involvement in settlement construction.

It cautioned businesses against participating in E1 or "any other colonial settlement projects," citing potential "legal, economic and commercial consequences."

The warning places renewed attention on the role of businesses that finance, construct, supply, or otherwise support settlement projects in occupied Palestinian territory.

It also highlights the legal risks associated with commercial activities linked to settlements that violate international law.

The statement did not announce specific penalties against individual companies but warned of the potential consequences of their participation.

Israel Continues to Advance Settlement Expansion

Israeli authorities have repeatedly sought to advance construction in the E1 area over the past two decades, although several proposals have been delayed or frozen following international pressure.

Israel considers Ma'ale Adumim and the surrounding area strategically important because of their proximity to Jerusalem and their connection to existing Israeli settlements.

Palestinian officials, however, have warned that expanding settlements in the area would deepen the fragmentation of occupied Palestinian territory and further restrict the development of Palestinian communities.

Israeli settlement expansion across the occupied West Bank has also been accompanied by land seizures, restrictions on Palestinian construction, and limitations on movement.

Israeli Settlements Violate International Law

Israeli settlements in the occupied West Bank, including occupied Jerusalem, are illegal under international law.

The Fourth Geneva Convention prohibits an occupying power from transferring parts of its civilian population into the territory it occupies.

In July 2024, the International Court of Justice concluded in an advisory opinion that Israel's continued presence in the occupied Palestinian territory is unlawful and that Israel must immediately cease new settlement activity.

The E1 project remains a major focus of international concern because of its potential to further divide Palestinian territory and obstruct the establishment of a geographically connected Palestinian state.

The Council's warning underscores mounting pressure on Israel to reverse settlement expansion plans and on businesses to avoid involvement in activities that could contribute to violations of international law.