Britain threatens sanctions against businesses bidding for Israeli settlement construction in E1, warning the project could undermine Palestinian statehood and a two-state solution…reports London Daily News Desk
The UK has warned businesses and individuals against bidding for Israeli settlement construction in the occupied West Bank, threatening sanctions and legal consequences as the deadline for bids for the controversial E1 project falls on Monday.
Foreign Secretary Ed Miliband said the Israeli government’s decision to open construction tenders in E1 threatened the prospect of a two-state solution, under which Israel and an independent Palestinian state would coexist.
The warning follows Britain’s introduction of new sanctions powers targeting individuals and companies involved in the construction of illegal Israeli settlements. The government has also pledged legislation to ban goods imported from settlements and take action against services that finance or facilitate their activities.
“We urge businesses and individuals not to proceed with bids for E1 construction tenders,” Miliband said, warning of legal and reputational consequences, including the risk of involvement in serious breaches of international law.
The Foreign Secretary said the government would not accept the continued displacement of Palestinians or the unlawful occupation of Palestinian territory.
“We will not be bystanders in the destruction of the two-state solution,” he added.
What is E1 settlement project?
The E1 area lies east of Jerusalem, between the city and the Israeli settlement of Ma’ale Adumim in the occupied West Bank. The proposed development would expand Israeli settlement construction across a strategically important stretch of land connecting major Palestinian population centres.
The project has received renewed attention because of concerns that construction could sever the territorial links between East Jerusalem and the rest of the West Bank, while restricting movement between Palestinian communities to the north and south.
Israel approved plans for approximately 3,400 housing units in the E1 area in August 2025, following years of delays amid international opposition. The latest tender covers 1,234 homes across seven residential compounds, according to reporting by The Times of Israel and other media outlets. A separate tender for a further 2,167 units has also been reported.
Palestinians regard East Jerusalem as the capital of their prospective state. Critics of the E1 project argue that settlement expansion in the area could fragment the occupied West Bank and make the creation of a geographically connected Palestinian state increasingly difficult.
The United Nations has also warned about the project’s implications. In September, UN officials told the Security Council that continued settlement expansion threatened the viability of a two-state solution.
Britain’s warning follows a joint statement issued by several Western governments in August opposing the E1 tender and urging Israel to withdraw its plans.
The statement was backed by the UK, France, Germany, Italy, the Netherlands, Canada and Norway, among others. The governments said the development would undermine the territorial continuity of a future Palestinian state and urged businesses not to bid for construction contracts.
Israel has rejected aspects of international criticism of its policies and maintains its own claims and security arguments concerning the territory.
New UK sanctions powers target settlement activity
The British government has been stepping up its response to settlement expansion and violence against Palestinians in the West Bank.
In August, Miliband condemned the launch of the E1 tender, demanded that Israel halt the plans and summoned the Israeli chargé d’affaires to the Foreign, Commonwealth and Development Office.
Miliband also condemned what he described as escalating settler violence in the West Bank, citing recent attacks involving officials from France, Belgium and Poland, a representative of the Catholic Church and a US journalist.
The government said it would pursue further action against settlement-related trade and services as part of its effort to preserve the possibility of a negotiated settlement.
