When Spain began blocking Israeli products imported from the West Bank, Golan Heights and East Jerusalem this week, it officially kicked off what may be the largest state-level embargo of products and services from the Jewish state since the Arab League boycott launched around the time of Israel’s inception.
While the ban on those products, and other measures that took effect on December 30, are not expected to significantly impact Israel’s economy or its $850 million in annual exports to Spain, they give a “symbolic message” that may encourage other countries to pursue similar trade boycotts with the Jewish state in the future, according to Maya Sion-Tzidkiyahu, director of the Israel – Europe Relations Program at the Mitvim Institute and a lecturer at the Hebrew University of Jerusalem’s European Forum.
“When a country of considerable size like Spain advances a move like this, it gives backing to smaller states to follow,” she said.
December 30 marked the deadline in Spain for formal enforcement of Royal Decree-Law 10/2025 (Spanish link), a law passed in September providing for “urgent measures against the genocide in Gaza and support for the Palestinian population.”
That day, Spain’s Finance Ministry began officially enforcing a ban on products originating “from Israeli settlements in the Occupied Palestinian Territory.” It published on its website a list of hundreds of localities and postal codes, including those in the Golan and East Jerusalem, from which imports would be forbidden. Products from these areas — primarily agricultural products, wine and cosmetics — likely comprise just a tiny fraction of Israel’s exports to Spain.
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The law also states that all imports from Israel must now state clearly their place of origin and postal code.
Spanish Prime Minister Pedro Sanchez announcing several measures, including an arms embargo on Israel, September 8, 2025. (Borja Puig de la Bellacasa / LA MONCLOA / AFP)
Also on that day, Spain’s Social Rights, Consumer Affairs and Agenda Ministry contacted seven websites promoting vacation rentals and told them to immediately remove or block 138 different ads for apartments in “Israeli settlements in occupied Palestinian territory.”
Article 4 of the law establishes that advertising the sale of goods from those settlements, or services provided in them, is now illegal, it explained.
Failure to remove these ads could result in further actions, the ministry warned, without specifying a penalty.
Also on December 30, Spain announced an exception to a total ban that went into effect in September on the export and import to Israel of defense technologies, including “dual-use” technologies. That law had allowed for exceptions to be made for reasons of “national interest,” and on Tuesday, the government announced that aviation giant Airbus would be allowed to continue importing from Israel.
Airbus uses Israeli technologies for several programs based in Spain that employ thousands of people and comprise as much as 60 percent of Spain’s total air and defense exports.
An Elbit Systems’ staff member looks at his phone at the Eurosatory international land and airland defence and security trade fair, in Villepinte, a northern suburb of Paris, June 13, 2022. (Emmanuel Dunand/AFP)
“The inability to maintain this trade with Israel would seriously jeopardize the continuity of these projects in Spain, which would have an industrial, economic, employment and technological impact of such magnitude that it would affect strategic autonomy and general national interests,” the government stated in a Council of Ministers meeting.
The exception for Airbus may be seen as a small victory for Israeli technologies. However, the fact that Spain issued the exception on that day made it clear that the new laws regarding arms sales are now being actively enforced, analysts said.
Its restrictions are likely to generate legal uncertainty and create supply chain disruptions for numerous companies, commercial advisers say.
Since the October 7, 2023, Hamas onslaught, Spain has emerged as one of Europe’s most aggressive critics of Israel, systematically dismantling decades of diplomatic and economic cooperation and instead pushing harsh sanctions that have taken a bite out of once-thriving ties.
Under the leadership of Prime Minister Pedro Sánchez, Madrid has used some of the most severe rhetoric of any G20 nation, frequently labeling Israel’s military operations as “extermination” and “genocide.”
In June 2024, it was the first European country to formally apply to join South Africa’s case against Israel at the International Court of Justice (ICJ). A month earlier, it formally recognized a Palestinian state in a coordinated effort with Norway and Ireland in an attempt to increase diplomatic pressure on Jerusalem to end its war with Hamas.
Palestinian Authority President Mahmoud Abbas (left) shakes hands with Spanish Prime Minister Pedro Sanchez after delivering remarks following their meeting at the Moncloa Palace in Madrid on December 12, 2025. (Javier SORIANO / AFP)
Trade wars
Spain is now the second European country to implement a ban on products from Israeli settlements and any weapons trade, after Slovenia launched similar boycotts in August, but its impact is expected to be much more significant.
The European Union has had a longstanding policy that Israel’s presence in the West Bank and other territories conquered during the 1967 war is illegal, but has generally refrained from enforcing that position with trade sanctions beyond labeling guidelines, due largely to disagreements between member states.
Slovenia’s measures, which it said at the time were designed to ratchet up diplomatic pressure over the war in Gaza, were mostly symbolic. Trade in weapons and products made in the settlements was virtually zero before the ban, and Slovenia’s Foreign Minister Tanja Fajon conceded at the time that the measure was chiefly about messaging to the country’s partners in the European Union.
“While symbolic,” the ban “is a necessary response to the ongoing humanitarian and security situation in Gaza,” she said at the time.
People hang a Palestinian flag in front of the Slovenian Parliament building after the National Assembly recognized a Palestinian state in Ljubljana, on June 4, 2024. (AFP)
Other countries have limited state-level restrictions on trade with Israel, such as Colombia’s ban on coal sales to Israel. Canada, Germany, the United Kingdom, Italy and Belgium are among those that have restrictions on arms trade with Israel, but Spain’s is the most comprehensive, with a two-way embargo that bans both the export and the import of defense material, as well as bans on “dual-use” products that also affect its tech sector.
To counter the effects of such boycotts, Prime Minister Benjamin Netanyahu recently unveiled a massive NIS 350 billion ($108 billion) strategic independence plan to bolster Israel’s defense industry and reduce its reliance on foreign markets.
The move, he said, stemmed from a desire to “reduce our dependence on all players, including friends,” after allies imposed various restrictions on weapons sales to Israel in reaction to the war in Gaza.
Still, he noted, many countries around the world “want to buy more and more systems from us.”
Israeli Air Force F-35I fighter jets depart for strikes in Iran, June 13, 2025. (Israel Defense Forces)
Shortly after Spain passed its trade ban on defense products in September, the country canceled a contract worth nearly 700 million euros ($825 million) for Israeli-designed rocket launchers.
The country has already blocked 200 attempts to buy material linked to Israel, its digital transformation minister Oscar Lopez recently told national broadcaster TVE.
Dr. Maya Sion-Tzidkiyahu (Courtesy)
But besides concerns about the embargo’s impact in and of itself, there is concern that the measure could pave the way for other countries to follow.
“This is sending a strong political message that others are seeing,” Sion-Tzidkiyahu said.
Ireland, Israel’s fourth-largest export market in the EU, is said to be close to finalizing its Occupied Territories Bill, which could endanger billions of dollars in annual trade. Israeli companies sold more than $3 billion of electronics and microchips to tech manufacturers in Ireland last year and bought more than $1.6 billion in pharmaceuticals and medical products.
A ban on products from Israel’s settlements could create a legal quagmire for Ireland, as it could trigger US anti-boycott laws that would affect large multinational corporations, including Intel, Google and Microsoft, that have large hubs in all three countries. If Irish law forces them to boycott an Israeli subsidiary or service, even ones based over the Green Line, those companies could face massive legal penalties in the United States.
Pro-Palestinian, anti-Israel protesters march in Dublin, Ireland, January 13, 2024. (Screen capture: X/Fergal O’Brien, used in accordance with Clause 27a of the Copyright Law)
That, in turn, could create a snowball effect that would be difficult for Israel to combat.
“If other countries follow, they could form a group that would protect them from Israeli retaliation,” Sion-Tzidkiyahu said. “That would be very challenging.”
