Dutch law impacts some Israeli exports

Amsterdam-based Wouter Seinen of Pinsent Masons was commenting after Dutch legislators decided to impose trade-related sanctions in response to what they have described as “unlawful settlement in the territories occupied by Israel”.

The measures prohibit the import, purchase and sale of affected goods in the Netherlands, as well as certain intermediary services and arrangements designed to circumvent the restrictions. The regime applies not only to products wholly originating from the relevant territories, but also to goods that are wholly or partly produced using ingredients, raw materials, components or semi-finished products sourced from those areas. The new law will enter into force on 21 September.

Seinen said: “Thee measures are likely to be particularly relevant for the food, technology and life sciences sectors. Food businesses may need to verify the origin of ingredients and raw materials throughout their supply chains, while technology and life sciences companies may need to assess whether components, subassemblies or products are linked to affected locations. The restrictions can also affect businesses that acquire, distribute or market products in the Netherlands even where they do not import them directly.”

“The rules apply to products that only contain some ingredients from the relevant origins. That said, software and services without any hardware component fall outside of the scope,” he said.

Seinen said businesses that do not comply with the trade restrictions face a range of enforcement-related risks.

“The regime will be enforced by the Dutch customs authorities, FIOD (the Fiscal Information and Investigation Service) and the public prosecutor,” Seinen said. “Potential consequences include criminal investigation, fines, seizure and forfeiture of goods, and disruption to commercial operations. Retailers and other customers are already beginning to impose contractual supply-chain transparency and documentation requirements which, in some cases, go beyond the express requirements of the legislation itself.”