EU threatens action on Israeli exports

The long-running dispute on goods exported from Palestinian territories burst into the open at a meeting of the European Union-Israel Association Council meeting in Luxembourg on 21 October 2002. The dispute centres on 'rules of origin' for goods exported to the European Union from East Jerusalem, Gaza, the West Bank and the Golan Heights. They mostly originate from Jewish settlements, and Israel has taken advantage of its trade accord with the EU that permits export of goods to Europe under a preferential tariff. However, Israel has extended the tariff arrangement to the occupied territories from where it exports items such as wine, olives and carpets under 'Made in Israel' labels. EU officials have threatened to take the dispute to arbitration.