Doing Business in the Illegal Israeli Settlements? Think Twice.

Doing business with Israeli settlements in the Occupied Palestinian Territories (OPT) poses significant risks to companies. Not only are these settlements illegal under international law, they are associated with widespread human rights violations. Companies weighing up whether they can do business with the settlements should reconsider. 

Unfortunately, many companies have no framework for examining their business interests and potential relationships with the settlements. 

To this end, Amnesty International recently released “THINK TWICE: Can companies do business with Israeli settlements in the Occupied Palestinian Territories while respecting human rights?”; a briefing that covers issues relevant to companies across all industry sectors and at all stages of their trade and investment relationships in and with Israeli settlements. This publication draws on a range of standards and laws that are relevant to business conduct including international human rights law, international humanitarian law and the UN Guiding Principles on Business and Human Rights.

Companies must regard this as a legal compliance issue; where companies involved may face reputational damage, withdrawal by investors and legal measures including criminal prosecution.

Can companies afford to do business with the settlements?

Israeli settlements are built on confiscated Palestinian land and benefit from discriminatory policies resulting from the illegal ongoing Israeli occupation of the Palestinian Territories since 1967. Businesses operating in and with these settlements therefore inherently contribute to their maintenance and risk contributing to grave international law violations, illegal activities and serious violations of fundamental human rights. 

Some of these businesses include banks and other financial institutions, law firms, construction companies, real estate agents, utilities and service companies, agricultural and food companies, manufacturing companies, tourism agencies and security and information technology companies. Although companies may believe they are operating ordinary courses of business, they must take into account and acknowledge that they are located and operating in the context of a military occupation and therefore cannot mitigate contributing to serious human rights violations.

 Doing business in occupied territories carries very real risks, dilemmas and potential liabilities for companies.

Israeli settlements are illegal under international law

Companies considering operating in or doing business with Israeli settlements in the Occupied Palestinian Territories need to take account of the fact that any business activity there will inevitably contribute to an illegal situation.

 In order to adhere to international human rights and humanitarian law, companies should respect international rules applicable to situations of occupation, such as The Hague Regulations of 1907 and the 1949 Fourth Geneva Convention. These include a number of special protections designed to safeguard the local population from abuse, protect their assets from being pillaged and ensure the continuation of the pre-conflict way of life, which includes respect for cultural rights.

For instance, international humanitarian law prohibits an occupying power from transferring its own civilians into a territory that it occupies. It also prohibits an occupying power from forcibly transferring protected persons from occupied territory. Moreover, under the Hague Regulations of 1907, the public property of the local population of the occupied territories (such as land, forests and agricultural estates) is subject to the laws of usufruct. This means that an occupying state is only allowed to use this property for the benefit of the local population or for its military needs.

Human rights violations are inherent and inextricably linked to Israel’s settlement enterprise, because they contribute to serious human rights abuses against Palestinians living in the OPT, inter alia:

  • The right to life

  • The right to adequate housing

  • The right to equality and non-discrimination

  • The right to liberty and fair trial

  • The right to an effective remedy

  • The right to security of person and to health

  • The rights of children

  • The right to water

  • The right to education

  • The right to peaceful assembly

  • Labour rights

  • The right to freedom of movement

Israeli settlements are illegal under international law. The transfer of the civilian population of the occupying power into the occupied territories, and the forcible displacement of the local population from the occupied territory constitutes a war crime under the Rome Statute of the International Criminal Court.

Businesses contributing to war crimes

Companies cannot do business in or with illegal Israeli settlements without contributing to serious violations of both international humanitarian law and human rights law.

Settlement businesses depend on and benefit from Israel’s unlawful confiscation of Palestinian land and other resources. Industrial parks in settlements offer numerous incentives, including tax breaks, low rents and low labour costs. They benefit from Israel’s discriminatory policies for planning and zoning, financial incentives, access to utilities and infrastructure. Meanwhile, Palestinian enterprises are disadvantaged through restrictions on movement and administrative and legal constraints.

In its January 2018 report on business enterprises linked to the occupation, the UN Office of the High Commissioner for Human Rights (OHCHR) concluded that:

considering the weight of the international legal consensus concerning the illegal nature of the settlements themselves, and the systemic and pervasive nature of the negative human rights impact caused by them, it is difficult to imagine a scenario in which a company could engage in listed activities in a way that is consistent with the Guiding Principles and international law.

As a result of these special circumstances, it is inevitable that conducting business in the OPT and/or with Israeli settlements involves potential illegal activities and human rights violations. 

Companies are pulling out of the settlements, with good reason

In the past few years a considerable number of companies have terminated operations linked to Israeli settlement in the OPT. Banks and pension funds have taken steps to exclude companies from their investment portfolios, owing to concerns about the legal and ethical implications of those companies’ activities there.

The reasons for these divestments vary from case to case: legal action, government pressure, outcomes of dispute resolution processes under the OECD Guidelines for Multinational Enterprises, reputational risk, civil society campaigns or the ethical policies of state pension funds. Some companies have explicitly cited the illegality of the settlements under international law as a reason for disengaging. Amnesty International’s Think Twice briefing includes examples of divestment that demonstrate this increasing trend.

The scrutiny of companies doing business in or with Israeli settlements will increase with the UN’s compilation and publication of a database of enterprises involved in activities there. And as the UN Independent International Fact-Finding Mission report of 2013 stated:

It is with the full knowledge of the current situation and the related liability risks that business enterprises unfold their activities in the settlements and contribute to their maintenance, development and consolidation.

The risk of criminal prosecution and civil litigation under domestic legal regimes for damages arising from business activities in or with settlements is real. The International Committee of the Red Cross has noted that international humanitarian law applies to businesses in situations of conflict, imposing obligations on managers and staff not to breach these rules. 

As outlined above, certain acts carried out by Israel in relation to its illegal settlement policy amount to war crimes. This means that companies carrying out activities that contribute to the maintenance, development and expansion of these settlements expose themselves – and their individual directors and managers – to the risk of prosecution for complicity in war crimes. They may also be sued for damages in civil courts.

Destination: Occupation

Amnesty’s Destination: Occupation campaign covers the online tourism industry and its role in helping maintain and grow illegal Israeli settlements. The report examines four international digital tourism companies: Airbnb,, Expedia and TripAdvisor, exposing their activities related to Israeli settlements in the OPT and their contribution to and benefit from Israel’s violations of international humanitarian and human rights law.

SIGN our online petition telling TripAdvisor that settlements are on stolen Palestinian land. Their promotion as a tourist destination helps normalize and legitimize them to the public. Settlements are illegal under international law; their creation amounts to a war crime. They should not be tourist destinations.

Ongoing land confiscation promotes settlement expansions

Amnesty’s Occupation @50 campaign calls on states to prohibit Israeli settlement goods from entering their markets, and to stop companies domiciled in their territories from operating in settlements or trading in their goods.  

Since its occupation in 1967, Israel has promoted the creation and expansion of settlements in the OPT, resulting in:

  • the appropriation of 200,000+ hectares of Palestinian land;

  • the establishment of 250+ settlements, populated by 600,000+ Israeli settlers;

  • the physical enclosure and segregation of the 3 million West Bank Palestinians;

  • the extension of Israeli laws to the West Bank and the creation of a discriminatory legal regime;

  • the unequal access to natural resources, social services, property and land for Palestinians in the occupied West Bank.

SIGN our online petition to tell the Canadian government it’s time stop fuelling Palestinian suffering. It’s time to ban settlement products from entering our borders and stop Canadian companies profiting from the settlements.