Belgian authorities intent on cutting off funding for Israeli tech companies
EU Proposes Partial Suspension of Israeli Tech Startup Funding
The European Commission has proposed a partial suspension of Israeli tech startup funding under the Horizon Europe program, specifically targeting grants linked to dual-use technologies such as drones, cybersecurity, and artificial intelligence. This move is a direct response to Israel’s actions in Gaza, which the Commission cites as violating human rights obligations under the EU-Israel Association Agreement.
Background and Reasons
The proposal comes amid the severe humanitarian situation in Gaza, with the EU Commission highlighting restrictions Israel has imposed on humanitarian aid delivery to Palestinians in Gaza. The decision is grounded in Article 2 of the EU-Israel Association Agreement, which requires respect for human rights as a fundamental condition for cooperation. Although Israel has implemented some humanitarian pauses and commitments, the EU considers these insufficient, characterizing the situation as "grave" and citing audits pointing to human rights violations by Israel.
The proposal focuses on restricting Israeli access to the European Innovation Council (EIC) Accelerator, a sub-program within Horizon Europe that funds startups with innovative and potentially market-disrupting technologies, including security-related dual-use technologies.
Potential Impact
Israel has been a highly successful participant in Horizon’s EIC Accelerator, having received approximately $231 million since 2021 and notable funding for startups in sectors like biotech and AI. The suspension would halt funding for Israeli startups developing dual-use tech, which could impair innovation and commercial cooperation in these fields between Israel and the EU.
However, it's important to note that the move does not affect Israeli universities and researchers involved in broader Horizon Europe scientific projects but strictly targets funding related to sensitive dual-use technologies. To become effective, the proposal requires a qualified majority vote from EU member states: at least 15 of the 27 countries representing 65% of the EU population. Germany and some other EU countries have expressed opposition to sanctions on Israel, so the vote outcome remains uncertain.
Israel has rejected the proposal, labeling it as “mistaken, regrettable and unjustified,” warning it could strengthen Hamas by undermining ceasefire prospects.
In summary, the EU Commission’s proposal reflects a significant and unprecedented move to sanction Israel through restricting tech collaboration funding based on human rights concerns, potentially affecting Israeli startups primarily in security-relevant fields, pending approval by member states. The humanitarian situation in the Gaza Strip remains critical.
- The EU's proposal to partially suspend Israeli tech startup funding under the Horizon Europe program, primarily targeting grants linked to dual-use technologies such as drones, cybersecurity, and artificial intelligence, is a consequence of Israel's actions violating human rights obligations under the EU-Israel Association Agreement, as mentioned in the community policy as well as the general-news.
- The financial implications of this proposed suspension could have significant effects on Israel's access to funding sources like the European Innovation Council (EIC) Accelerator, which supports startups in sectors like biotech and AI, thereby impacting the overall business and technology climate, as per the finance, business, and technology sectors.
- Political considerations are at play amidst the EU's proposal, as Germany and some other EU countries have expressed opposition to sanctions on Israel, which could potentially alter the outcome of the qualified majority vote needed to approve the measure, as per politics.
