EU weighs sanctions on Israel as concerns mount over Gaza aid deal

Good morning. News to start: The EU’s next seven-year, €1tn budget is set to benefit eastern states bordering Russia and ease oversight over regional development cash, according to a leaked plan seen by the Financial Times.

Today, the UN’s former point person in Gaza questions the details of the EU’s aid deal with Israel, and our energy correspondent hears concerns that Brussels’ ban on Russian gas could brach EU law.

Aid trap

An EU-Israel deal to increase aid shipments into Gaza risks being yet another false dawn for Brussels’ efforts to hold Israel to account, the UN’s former special co-ordinator has said.

Context: EU foreign ministers meet in Brussels today to discuss EU chief diplomat Kaja Kallas’s deal with the Israeli government to increase aid to the Palestinian enclave, announced last week.

They will also discuss options to put sanctions on Israel for its war that has reduced much of Gaza to rubble and left 2.1mn people facing starvation. Options range from trade sanctions to a suspension of the EU’s association agreement with the country.

Sigrid Kaag, who stepped down as the UN’s special co-ordinator for the Middle East Peace Process this month, said Kallas’s deal could represent a “promising” development for Gaza, but “the devil is in the details”.

“I don’t know what the deal actually entails in terms of volume, in terms of the scope of goods, and which safeguards and guarantees there are,” Kaag said. “For me . . . it does read like a déjà-vu on many levels.”

Since the EU deal was announced last Thursday, scores of people including children have been killed by Israeli forces while seeking aid from the Israel-backed Gaza Humanitarian Foundation.

Kaag said that the EU must not fall into a trap of seeing aid as a bargaining chip, rather than a fundamental human right.

“[The deal] can be an opening, at the end of the day, if it’s about saving lives, if it works, and if it’s in line with international humanitarian law,” she said. “But it can’t take us away from the big picture: Aid should not be militarised or weaponised, let alone be a negotiating tool.”

But Kaag, who was also the UN’s senior co-ordinator for Gaza, said “divisions among EU member states” often reduced the role the EU could play in the region. “You also have to ask yourself . . . if they’re willing to use political clout in a more coherent manner.”

Ireland’s Europe minister Thomas Byrne, whose country joined Spain in first requesting a review of the association agreement, said he would be asking ministers today to join its national ban on imports of goods from settlements in the occupied West Bank.

“That would be much stronger if it came from the EU and would apply a huge amount of pressure,” he told the FT. 

Chart du jour: Casualty

Volvo Cars is heavily exposed to higher import tariffs, forecasting smaller profits from two key vehicle models.

‘Grey zone’

The EU’s proposed ban of Russian gas from 2027 may sound impressive but lawyers warn that it may not pass muster in the courts, writes Alice Hancock.

Context: Three years after the start of Russia’s full-scale invasion of Ukraine the European Commission proposed last month to phase out Russian gas, starting with spot contracts, between now and 2027.

To avoid Russia-friendly Hungary and Slovakia vetoing the measure, the commission said that the ban would be based on the bloc’s trade policy, which can be approved by a weighted majority of member states rather than unanimity, which is needed for sanctions.

As EU diplomats meet in Brussels today to discuss the ban, lawyers are sceptical of its legal basis.

Ana Stanič, an energy lawyer advising one of the EU’s member states, said the EU’s common commercial policy has historically been understood to encompass external trade. “It cannot be used to adopt internal laws” such as the ban, she said.

Leigh Hancher, an expert in European regulatory law at the law firm Baker Botts, said: “This is really very much a grey area . . . it’s never been used before.”

She added that there was “heated debate” among EU countries about the legality of the ban. “Member states are always keen to make sure the commission doesn’t extend its competence,” Hancher said.

Several member states are still analysing the legislation. “We really want to be sure,” one EU diplomat said.

Slovakia, still a major buyer of Russian gas, has also said it will veto the EU’s latest package of sanctions against Russia, citing issues with the ban.

Slovakian Prime Minister Robert Fico has said he wants to reach an agreement with Brussels over support to deal with impacts of the ban, ideally before EU foreign ministers meet to discuss the sanctions today.

The commission did not respond to a request for comment.

What to watch today

1. EU foreign affairs ministers meet in Brussels.

2. German foreign minister Johann Wadephul and his Slovenian counterpart Tanja Fajon hold press conference in Berlin.

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