Israel moves bond approval process out of Ireland as Dublin pushes to reject ties

Luxembourg takes over European Union task of okaying prospectus for Diaspora bond program, used to help finance war, as Irish ramp up anti-Israel protests

DUBLIN, Ireland — Israel has moved the process of securing EU approval for its Diaspora bond prospectus from Ireland to Luxembourg amid increasing opposition in Dublin to its central bank’s role in approving the program on behalf of the European Union.

Irish lawmakers and pro-Palestinian campaign groups have called on the central bank to stop facilitating the sale of the bonds over the last year due to Israel’s nearly two-year military campaign against the Hamas terror group in Gaza.

Israel’s Diaspora bonds — an instrument used by some countries to fundraise among expats — are relatively small and sold mainly in Jewish communities around the world to help supplement the state’s bond sales that finance its budget deficit, which has risen due to the war sparked by Hamas’s onslaught in October 2023.

Non-EU countries must choose one EU member state to apply to for approval of a prospectus where securities are traded in the EU and Ireland’s central bank had been asked to approve Israel’s Diaspora bond program each year since 2021.

A joint committee of Irish lawmakers recommended in August that the government seek to amend EU regulations so as to allow each individual European central bank to refuse to act as the competent authority for such bond prospectuses.

Protesters have also demonstrated outside the central bank’s offices.

Activists from Action Justice Climat stick a placard depicting the Palestinian flag on a wall after painting the facade of French multinational bank and financial services holding company BNP Paribas at Place de la Bourse in Paris on October 24, 2024, as they accuse BNP Paribas of financing Israel through the purchase of bonds. (Dimitar DILKOFF / AFP)

Ireland is one of the most pro-Palestinian EU member states. It officially recognized a Palestinian state last year and the government is drafting legislation on restricting trade with Israeli settlements in the West Bank.

The Irish central bank had consistently said it is legally obliged to approve any prospectus once the relevant conditions are met.

In a letter to a lawmaker published by the central bank, Governor Gabriel Makhlouf said the approval for Israel’s program would be transferred to Luxembourg upon the expiry of the prior year’s prospectus on Monday.

Israel Bonds President & CEO Dani Naveh speaks at the Israel Bonds real estate & allied division luncheon in New York City, November 13, 2023. (Shahar Azran/Israel Bonds)

The new prospectus published on the website of Israel Bonds, the country’s borrowing vehicle for Diaspora bonds, said its program for the next year had been approved by Luxembourg.

Israel’s Finance Ministry did not immediately comment on the reasons for moving its EU bond prospectus approval.

The war against Hamas in Gaza began with the terror group’s shock invasion on October 7, 2023, in which 1,200 people were killed in southern Israel and 251 abducted to the Gaza Strip, about a fifth of whom are still being held.

More than 63,000 people in Gaza have been killed during the war, according to Hamas health officials in the enclave, who do not differentiate between civilians and combatants. Israel says it has killed over 22,000 combatants in battle as of August and another 1,600 terrorists inside Israel during the October 7 onslaught.

Israel has said it seeks to minimize civilian fatalities and stresses that Hamas uses Gaza’s civilians as human shields, fighting from civilian areas including homes, hospitals, schools, and mosques.

Israel’s toll in the ground offensive against Hamas in Gaza and in military operations along the border with the Strip stands at 460.