Israel and the European Union have completed negotiations for the occupation state to join the EU's key funding programme for research and innovation, Horizon Europe. There is, however, a clause banning the use of funds within the Occupied Palestinian Territories. Israel will be permitted to remain a member of the €95.5 billion ($111) programme for seven years, despite the apparent difference of opinion about its occupation.
Funding guidelines for the Horizon Europe programme are in line with the EU's policy on illegal settlements. The bloc prohibits the allocation of funds to Israeli entities situated in the Occupied Palestinian Territory, or for research carried out there.
The agreement requires Israeli companies, organisations or academic institutes which apply for European loans or grants to set up a mechanism to ensure that the funds do not get invested over the Green (1949 Armistice) Line. Israel however makes no such distinctions and has essentially extended its sovereignty over the Palestinian territory without granting basic rights to millions of Palestinians living there. Human rights group have cited this to conclude that Israel practices apartheid.
The EU forbids member states from funding, cooperating with, or granting scholarships, research grants, and prizes to groups or individuals within West Bank settlements, the Golan Heights, or the parts of Jerusalem outside of Israel's pre-1967 nominal borders. Moreover, the policy initially agreed in 2013 established that any future deal signed with Israel must contain a clause asserting that the settlements are not part of Israel and are therefore not part of the agreement.
Nevertheless, the EU has been open to finding ways to work around its own prohibitions on funding projects within the occupied territories. This has prompted accusations that it has been rewarding Israel's human rights abuses.
In 2013, Israel's then Justice Minister, Tzipi Livni, said that the settlements' status within Horizon Europe's membership conditions would not constitute Israeli recognition of the pre-1967 borders. Even though the clause basically means that Israel does not agree with the EU it is being allowed to enjoy all of the benefits offered by the programme.
With the final draft agreed, the Israeli government and Knesset are expected to approve the deal with its settlement exclusion clause. The draft agreement will be published in December.