The Irish government on Wednesday defeated a cross-party motion that called on it to stop the Central Bank of Ireland from facilitating the sale of Israeli bonds.
The motion, presented by the Social Democrats and supported by Sinn Féin, Labour, and People Before Profit, was intended to block what many refer to as “Israeli war bonds”.
The instruments provide economic support to Israel while it conducts military operations in Gaza, and Ireland’s Central Bank currently approves the sale of these bonds in EU markets.
Bonds issued by non-EU countries must be approved by the financial regulator in one member state before they can be sold within the single market.
The bill failed with 85 votes against and 71 in favour, upholding the government’s position.
Several TDs, Irish members of parliament, argued that Ireland should not be involved in financial instruments that fund destruction in Gaza.
The Central Bank estimated that Israel has raised between €100mn and €130mn from their sale.
Taoiseach Micheál Martin nonetheless rejected claims that the Irish government is complicit in genocide by allowing the facilitation of the bond sales.
Despite publicly acknowledging the severity of Israel’s attacks in Gaza, he maintained that Ireland must oppose the military action within legal and diplomatic channels.
As such, the government argued that it cannot legally direct the Central Bank due to its independence under Irish and EU law.
When the same objection arose last month in response to a similar motion from Sinn Féin, party leader Mary Lou McDonald argued: “We have over 20 pages of independent, robust legal opinion clearly stating that the bill is compliant with Irish law, European law and international law.”
As per the EU’s Prospectus Regulation, non-EU countries like Israel must meet disclosure and legal standards to issue bonds in the bloc. If those standards are met, the Central Bank doesn’t have the authority to reject bond applications.
“The Central Bank cannot decide to impose sanctions for breaches or alleged breaches of international law. It is for international bodies such as the UN or the EU to determine how to respond to breaches or alleged breaches of international law,” said Central Bank Governor Gabriel Makhlouf.
He added that the Genocide Convention applies to the Irish State, not regulatory bodies like the Central Bank.
The reason why the Irish Central Bank is at the core of this issue — despite Ireland being one of the EU countries that has been the most vocally pro-Palestine — is Brexit. When the United Kingdom voted to leave the European Union in 2016, Israel chose Ireland to be the home member state to approve its bonds. Prior to 2021, this responsibility fell to the UK.
The current prospectus for Israeli bonds is set to expire in September, but Central Bank officials believe that Israeli authorities will likely initiate the renewal process several weeks beforehand.
In the absence of new EU sanctions or changes to existing legislation, the Central Bank will remain legally bound to approve the bond prospectus, regardless of the political fallout.
Meanwhile, protesters have been gathering for months outside the seat of the parliament, Leinster House, and the Central Bank, demanding that the government block Israeli bond sales.
