E1 Settlement Tender: UK Warns Bidders of Sanctions as Deadline Arrives

Britain warned companies on Monday, Oct. 19, 2026, not to bid on Israel’s E1 settlement tender, saying they risk sanctions. Monday was the deadline for bids on the first phase of construction in E1, an area east of Jerusalem. The warning from Foreign Secretary Ed Miliband came four days after new U.K. sanctions powers took effect that could target firms and financiers involved in settlement building in the West Bank.

“I want to be very clear with those considering engaging in the tendering process: we have created new powers allowing us to sanction individuals and companies involved in the construction of illegal settlements such as E1,” Miliband said in a statement on GOV.UK. “We urge businesses and individuals not to proceed with bids for E1 construction tenders.”

What the E1 settlement tender covers

The tender covers 1,234 housing units, part of a broader plan for about 3,400 units in E1, The Jerusalem Post reported. E1 lies between Jerusalem and the settlement of Ma’ale Adumim. Bids were due Oct. 19, but the tender committee’s review of them has been postponed until after Nov. 19. That means companies must decide whether to bid before it is clear whether Britain will use its new powers against anyone linked to the project.

Britain says building in E1 would break the territorial continuity needed for a future Palestinian state. Israeli officials see the development as part of settlement expansion and of strengthening the link between Jerusalem and Ma’ale Adumim, the Post reported, and they reject the argument that international opposition should stop it. Miliband called the Israeli government’s decision to open the tenders “a direct threat to the prospect of a two-state solution.”

Britain’s new sanctions powers

The new regulations, which took effect Thursday, Oct. 15, expand Britain’s human rights and international humanitarian law sanctions framework. According to The Jerusalem Post, they allow sanctions on people and entities directly involved in serious violations of international law, and on those who finance, facilitate or promote such activity, subject to legal conditions. Possible measures include:

• Asset freezes and financial restrictions
• Travel bans
• Disqualification from serving as company directors

The rules do not impose blanket restrictions on every company operating in the area, the Post reported. Simply doing business in the West Bank is not, by itself, grounds for sanctions. The regulations also add a fast-track mechanism letting London temporarily adopt partner countries’ sanctions for up to 112 days while it weighs its own measures.

Miliband said the government is also committed to legislation banning imports of goods from settlements and acting on services that finance or facilitate them. The import ban, part of a plan he presented on Sept. 8, has not yet been completed, according to the Post. In September, 12 Western countries including Britain, France and Canada said they backed trade restrictions related to settlements. Separately, the Post said the measures come amid a diplomatic dispute between Israel and Britain over the closure of the British consulate in east Jerusalem.

Pressure on banks and builders

Britain’s approach aims to deter companies at the bidding stage, before contractors are chosen. Last month, members of Parliament wrote to banks and financial institutions, asking them to assess their exposure to E1 and raise the issue at board level. The letters were requests, not binding directives. This week the Britain Palestine Project, a group that supports measures against settlements, warned contractors that taking part could put their international business ties at risk.

Inside Israel, the settlement watchdog Peace Now warned that the effects could spread. “Today, these are sanctions on settlements. Tomorrow, they will reach every household in Israel,” the group said, accusing Prime Minister Benjamin Netanyahu and Finance Minister Bezalel Smotrich of advancing E1. The Post noted that concerns had also been raised within the Israeli government that foreign banks and importers might struggle to tell settlement firms apart from other Israeli businesses. Any economic damage is so far only a forecast, and its scale is unknown.

Settler violence and what comes next

Miliband’s statement also condemned escalating settler violence in the West Bank. It cited recent attacks on officials from France, Belgium and Poland, a Catholic Church representative and a U.S. journalist. The Boston Report covered one of those incidents in Settlers attack European diplomats in Taybeh. “We will not be bystanders in the destruction of the two-state solution,” Miliband said.

The next milestone is the tender committee’s review after Nov. 19. A second is whether Britain names any company under the new powers. A third is whether other governments follow. For wider context on the conflict, see the Gaza ceasefire anniversary report.

Featured photo: The E1 area between Jerusalem and Ma’ale Adumim, by Dvirraz, CC BY-SA 3.0, via Wikimedia Commons (cropped; license). File photo.

Sources

• GOV.UK: Foreign Secretary statement on the deadline for bids for the E1 settlement tender
• The Jerusalem Post: UK expands sanction powers, enabling action against companies supporting West Bank settlements
• Al Arabiya: UK urges firms not to take part in E1 settlement tender or risk sanctions
• The Times of Israel: UK warns firms that bidding on E1 settlement tenders exposes them to sanctions