Australia withdrew from sanctions statement, leaving EU states disappointed

European diplomats say they were surprised and disappointed that Australia baulked at joining a UK-led move to impose trade sanctions on West Bank Israeli businesses.

Last week the United Kingdom announced a major policy shift by targeting Israeli settlements with sanctions, declaring that ethnic cleansing was taking place in the West Bank and declaring Israel's occupation of the territory unlawful.

The move was followed by a collective statement from 12 governments — the UK, France, Canada, Denmark, Finland, Iceland, Ireland, Norway, Poland, Portugal, Spain, and Sweden — which said they would also either commit to or consider targeting trade with illegal settlements.

In the lead-up to the statement's release, EU officials had been working to try and build a wide coalition of countries to ramp up pressure on Israel.

Australia had been involved in those discussions — and had indicated it was open to taking more action on the West Bank — only to ultimately decide it would not join the action reasonably late in proceedings, multiple diplomatic sources from different countries told the ABC.

According to four diplomatic sources, Australia was involved in the discussions around the sanctions until close to the statement's finalisation.

Canada was the only country outside Europe to put its name to the statement, despite those efforts to bring in a wider coalition.

Why Australia did not join coordinated move

Over the past year, Australia has acted in concert with a large group of countries to try and press Israel over Gaza and over its treatment of Palestinians — including the joint push for countries to recognise the State of Palestine at the UN General Assembly in New York one year ago.

But its absence from the collective statement has created a gap in foreign policy between allies that had been moving in step.

The ABC spoke to eight diplomatic sources, based across Sydney, Canberra, Jerusalem and Tel Aviv, who said the coalition of countries had hoped Australia would join the statement and were disappointed when it did not.

The sources spoke on condition of anonymity because they were not authorised to comment publicly on the issue.

In a statement, a spokesperson for the Department of Foreign Affairs and Trade said Australia and international partners were "working closely together towards the same objective, even if we are not all taking exactly the same measures at the same time".

"We are concerned blanket import bans present practical challenges, including how to ensure they do not inadvertently harm Palestinian businesses, workers and livelihoods. The UK government has acknowledged these challenges as they work on their legislation over the next year," they said.

"In the meantime, Australia is pursuing further targeted measures, in coordination with international partners, to deter illegal settlements and settler violence."

EU allies expected Australia to join action

One official from a Nordic country which joined the statement said they believed Australia was "likely" to sign on. They said Canberra had "missed an opportunity" to apply meaningful pressure on Israel by backing away from it.

Another official said they were "disappointed" that Australia did not sign the statement.

They said the Albanese government clearly had reservations about the impacts of the sanctions, and their enforceability, but speculated that the government was also worried about the domestic political impact.

A different EU official said they had seen some text for an earlier version of the statement, which had included Australia.

It was not clear whether Australia had actually ever agreed to be part of the statement or was just written into a draft.

It was only on the day the statement was released that two sources involved in the negotiations realised Australia had not joined, they told the ABC.

Two EU officials said they were "surprised" Australia did not sign on.

But another official from a different country also involved with negotiations painted a different picture, saying that while Australia had signalled it was open to signing on Canberra had never given a concrete commitment to join it.

The prospects of Australia following the UK may have also been complicated by local Australian politics, multiple sources suggested.

Some sources speculated the pressure Prime Minister Anthony Albanese has been under since the Bondi terror attacks, and the criticism from Jewish groups that the federal government has not been strong enough on anti-Semitism, may have played a part in Australia's decision not to announce sanctions last week.

Other sources suggested internal politics meant the federal government could not pull together an aligned position in time to join the statement.

Just two months ago, at the Labor Party's national conference, MP and former Albanese Government cabinet minister Ed Husic had pushed — unsuccessfully — for the party to take almost identical measures to those announced by the United Kingdom.

UK 'ethnic cleansing' statement caught officials off guard

Multiple sources from signatory countries also said they were caught off guard by UK Foreign Secretary Ed Miliband's announcement that preceded the joint statement.

Mr Miliband told the British parliament there was "ethnic cleansing" of Palestinians in parts of the West Bank and that Israel was turning a "blind eye" to it.

He also announced the British government's formal position was that the occupation of the West Bank was illegal, bringing the UK in line with the International Court of Justice 2024 advisory opinion.

His statement was a departure from the language agreed upon in the final joint statement, one EU source said.

Mr Miliband became the first UK foreign secretary to declare the West Bank occupation illegal and describe settlers' actions as "ethnic cleansing", marking a shift in the country's policy on Israel.

Australia 'ready to take more action'

Israel has been facing increasing international pressure over intensifying settler violence in the West Bank and its rapid expansion of settlements in the territory.

In August, four European countries released a joint statement condemning Israel's plans to move forward with a controversial development that would effectively split the West Bank in two.

Israel's occupation of the West Bank, and settlements in the territory, are considered illegal under international law.

Israeli human rights organisation B'Tselem this week released a report that concluded Israeli policies in the West Bank were "eliminating Palestinian collective existence".

Israel has denied accusations of ethnic cleansing and rejects that its occupation of the West Bank, or its settlements, are illegal.

Foreign Minister Penny Wong told the Senate last week that Australia would not be taking the same action as the UK, saying the government was instead "pursuing further targeted measures in coordination with international partners to deter illegal settlements and settler violence".

In June, Australia joined the UK, Canada, France and Norway in coordinated sanctions against Israeli networks involved in financing, enabling and carrying out violence in the Israeli-occupied West Bank.

At the time, in a statement, Australia said it stood "ready to take more action if the Government of Israel does not take urgent steps to address the situation on the ground".