Israeli-Palestinian Trade Relations Before the Israeli Supreme Court: The Case for an FTA

Arie Reich, Guy Harpaz

Research output: Contribution to journalArticlepeer-review


The Israeli Supreme Court recently delivered a judgment regarding a trade dispute between a Palestinian importer and Israeli trade authorities. The court relied on a trade agreement between the State of Israel and the Palestine Liberation Organization (PLO) (the ‘Paris Protocol’) of 1994 and concluded in favour of the Israeli authorities, based on a formal reading of the agreement. After analysing the judgment and concluding that its ruling is correct according to the prevailing law and trade agreement, this article suggests that the judgment underscores the fact that the Customs Union model used to regulate contemporary trade relations between the parties is inadequate. It further argues that a Free Trade Agreement would be a better model, which would allow the Palestinian Authority (the ‘PA’) to take responsibility for its trade policy, design a trade policy that would fit its needs, and promote more equal, reciprocal relations between the parties. Along with other democratic and governance reforms within the Palestinian Authority, such a model could reduce its economic dependence on Israel, improve diversification, support economic development, and reduce the concern for fiscal leakage connected to the current trade agreement. The article also calls for strong anti-corruption measures to be implemented within the Palestinian Authority to achieve these goals. Overall, the article highlights the need for a new trade agreement that promotes economic growth and development for both parties.

Original languageAmerican English
Pages (from-to)593-608
Number of pages16
JournalJournal of World Trade
Issue number4
StatePublished - 2023
Externally publishedYes

Bibliographical note

Publisher Copyright:
© 2023 Kluwer Law International BV, The Netherlands.


  • Customs Union
  • Free Trade Agreement
  • Israel
  • Palestinian Authority


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