The EU High Court in Luxembourg ruled that Israeli goods produced in the West Bank—disputed Palestinian territory—cannot receive EU tariff breaks.
The court upheld the previous decision of the German court, which refused to extend the trade privileges granted for Israeli goods to the products from the West Bank area.
Israeli authorities argued that products manufactured in those territories should not be subject of the EU import duties under the U.S.-Israel Agreement.
The ruling means that Israel cannot use the advantage of cheaper labor in the West Bank to enter the EU market with duty-free goods.
