Norway is pushing legislation which would bar Norwegian citizens and company executives from trading with Israeli settlements in the occupied West Bank and East Jerusalem, in what is the most severe economic condemnation so far from a European government against Israel's actions in the occupied territories.

Foreign Minister Espen Barth Eide told NRK he hopes the bill will be approved by the country's parliament, the Storting this autumn. The measure would make the trading of goods with Israeli settlers in the West Bank illegal for both people and businesses, and a public consultation on the draft ends on September 19. Eide said the timing was inextricable from what has happened on the ground, and that the more the West Bank situation worsened, the stronger the case for the law became, and that Norway was not doing this alone, but with more and more governments doing the same.

The bill wouldn't be confined to the West Bank. It also applies to East Jerusalem, which Israel has annexed since the 1967 war, but most of the world still considers to be occupied Palestinian territory. The distinction is important because many of the Jewish neighborhoods constructed in East Jerusalem since 1967 are, in practice, fully- integrated parts of Jerusalem; even the British Government's own sanctions drive has been fraught with difficulties, and a British official admitted last week it had not yet resolved whether Jewish areas of East Jerusalem are included within or outside its new restrictions.

On an economic level, the effect on Norway is close to insignificant. The trade relations between the settlements and Norway have been described as a trickle, according to Eide, with the exception of services related to the building industry, and mostly wine and agricultural products. The proposal is one of the softer sanctions measures that exists, as it focuses on a small part of settlement commerce as opposed to the wider Israeli economy, which is much more intertwined with settlement enterprises and would cost far more if attacked directly, Jørgen Jensehaugen, a senior researcher at the Peace Research Institute Oslo, said. This, in other words, is a law designed for signalling, not for causing harm to the balance sheet something that Israeli officials have picked up on despite their condemnation of the law.

Which symbolism is the very reason behind the weight of the bill. Norway is not alone. A week ago, 12 nations (Canada, Denmark, Finland, France, Iceland, Ireland, Norway, Poland, Portugal, Spain, Sweden and the United Kingdom) expressed agreement in a statement that they would be introducing or supporting national and European limits on the settlement business, stating that continued settlement expansion is making a two-state solution unworkable.

The United Kingdom was the first and most aggressive to announce new measures, with Foreign Secretary Ed Miliband announcing an import ban on settlement-made goods, a broader sanctions regime to extend to construction and financing linked to settlement growth, a ban on the UK's property events marketing settlement homes, and an expanded arms-export freeze. London's history indicates that these steps will not come into force until six to nine months later, and that this is a gradual, structural change and not a punitive gesture.

The response to Washington has been far less vocal than usual for such a massive offer from allies. Eide told NRK that the American reaction to the European sanctions wave was limited and rather understanding – and he felt that was a sign that the blanket protection Israel could count on from Western capitals, is wearing away. Secretary of State Marco Rubio has stated that the United States will not take a similar step to Britain, and U.S. Ambassador to Israel Mike Huckabee has suggested that if London goes ahead there will be “all but no response” from Washington but there hasn't been a single American response against a G7 ally. Former U.S. officials have been less sanguine about the entire European campaign, arguing that it is more about domestic political imperatives from their own floundering bases than about any strategic calculations and that, in practice, it is unlikely to have a significant impact on U.S. policy toward Israel.

Israel has rejected the Norwegian offer as another sign of the long-standing enmity of the foreign minister toward the country, and Jerusalem's foreign ministry has put the blame for London's action on “a false pretext.” This legislative package is not the only debate in town. In a new report released this week, B'Tselem, an Israeli human rights group, claims that West Bank policy since late 2022, and especially after the October 7, 2023 Hamas attacks, has constituted a “systematic approach to eroding the Palestinian collective life in the West Bank.” The Israeli government has yet to comment on the report and the military has consistently denied that the majority of Palestinian deaths in its operations in the west bank are of innocent civilians.

Less any one measure, the trajectory is what brings these threads together. Ten years ago, European opposition to settlements focused on the labeling of products. It now involves asset freezes, import bans and even a threat of prison time, all of which, even if an economic consequence of the actions, indicate a new approach to the settlement enterprise from a growing group of Western governments.