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Israel's annexation policy had already deeply alarmed the European Union – Israel's largest trading partner – who said that any such action would be a , in particular the prohibition on the acquisition of territory through force. 

As a staunch defender of the two-state solution, this could be the EU's moment to prove itself as a soft power and reaffirm its dedication to the principles and commitments of . Otherwise it could well lose credibility internationally.

Death of the two-state solution?

According to Zaha Hassan, a Visiting Fellow at the Carnegie Endowment for International Peace think tank, the EU does not appear ready to , which it has invested so much in.

The main reason for the EU's reluctance lies in the fact that the alternative to the two-state solution - a binational state where Israelis and Palestinians live as equals - does not seem likely in the short-term future.

As a staunch defender of the two-state solution, this could be the EU's moment to prove itself as a soft power and reaffirm its dedication to the principles of international law

"EU policy is also hamstrung by the fact that the Palestinian leadership is not prepared to let go of the two-state solution, even if it now finally recognises that the Oslo peace process is dead," Hassan told °®Âþµº.

Annexation is not just a problem for the EU. Indeed, the two-state solution is still also supported by the UN, Russia, China, Egypt, Jordan and the Arab League, as well as Japan and India, the African Union and every multilateral organisation around the globe. 

Nevertheless, despite being a key advocate of the two-state solution, the EU has never seriously sanctioned Israel over a long list of , while only nine out of the 28 EU member states recognise Palestine as a state and the bloc as a whole does not.  

Recent developments suggest that the three-decade process of achieving a solution through the two-state model may soon become completely irrelevant, and Europe will have to figure out how to respond to this new reality. The bloc must also bear in mind the impact of annexation on frozen conflicts within, or on the outskirts, of its own borders, namely Crimea, Kosovo, the Republika Srpska in Bosnia, and Northern Cyprus

EU sanctions 

European officials have expressed their unequivocal opposition to the  and are reportedly considering sanctions against Israel over its planned attempt to annex the occupied West Bank. 

Josep Borrell, the EU's foreign policy chief and reportedly a key advocate of sanctions,  that the EU will direct "all our diplomatic capacities" to try to dissuade Israel's government from going ahead with the move. However, it is most likely that European states will remain divided about what action to take.

The EU has never seriously sanctioned Israel over a long list of human rights violations, while only nine out of the 28 EU member states recognise Palestine as a state

Grace Wermenbol, a scholar at the Washington DC-based Middle East Institute, says that while several EU nations, including Josep Borrell's home country of Spain, have reportedly expressed support for  to deter Israel from annexation, Israel's closest allies, such as Hungary, Austria, and the Czech Republic, stand to block such preliminary measures.  

Similarly, according to Wermenbol, in the post-annexation period, "the EU's potential application of a carrot-and-stick policy towards its major trading partner and scientific R&D funding recipient would require a cross-member political consensus that is unlikely to emerge," she told °®Âþµº.  

EU leverage over Israel

But Europe has considerable leverage over Israel. The EU is Israel's largest trading partner so the multilateral mechanism and member states could use economic sanctions to compel Israel to act in accordance with international law and human rights.

Many Israelis are also dual citizens of EU countries and some of these individuals live in illegal settlements or have interests in the settlement enterprise. As a result, European countries could take action against their own citizens for facilitating and profiting from what amount to . 

Moreover, some suggest a strict implementation of UN Security Council resolution 2334 by hardening differentiation measures against Israeli settlements through strengthening the EU's financial guidelines, restricting Israeli settlement products but also extending into other areas, including social security, taxation, and consular services.

While settlement activity itself represents a flagrant violation of international law since the 1967 occupation, Ugo Tramballi, a Senior Advisor at the Italian Institute for International Political Studies (ISPI), told °®Âþµº that thus far the only so-called sanction on Israel has been a label reading 'Made in the Occupied Territories' – pasted on Israeli products coming from the West Bank.

Despite this clarification of "bad" origin, every item goes freely to EU markets and it is up to the seller whether to keep or remove the label. In the case of annexation, Tramballi says that Europe should be a little more consistent and should start to  and any Israeli and international economic activity in the occupied territories.

Shir Hever, a board member of the Jewish Voice for a Just Peace and author of the book Privatization of Israeli Security, believes that measures aimed at Israeli exclusion from the entire European milieu would be more effective because Israeli society refuses to acknowledge that Israel is part of the Middle East, and pretends to be part of Europe (what former prime minister Ehud Barak called "a villa in the jungle"). 

"Any sanctions by the EU that exclude Israel from European agreements – such as the visa agreements, the Eurovision, the Association Agreement, etc. have a tremendous symbolic and a psychological impact which far exceed their economic impact," he told °®Âþµº. 

The EU is Israel's largest trading partner and could use economic sanctions to compel Israel to act in accordance with international law

Moreover, Hassan says that Europe should also stop providing diplomatic cover for Israel in international forums, including the UN and the ICC, and could proactively support legal accountability for Israeli annexation and human rights abuses against the Palestinian people. 

"The various EU countries that have passed laws to prevent free and open debate about Israeli human rights violations by defining such discussions as anti-Semitism could repeal those measures so that private citizens could engage in advocacy and public awareness about what annexation means for the rights of Palestinians." 

The EU's most effective measure, in Hever's opinion, would be sending a clear message to Israel that "it does not qualify as a democracy and will only be allowed to engage in European projects after it begins respecting human rights and international law."  

However, it's important to remember that many European countries have lucrative economic relations with China, Saudi Arabia, Egypt, Iran and many more undemocratic systems who daily violate the rights of their own citizens, making it harder to halt existing programmes and agreements, particularly on trade and new technologies. 

Within Europe, Netanyahu has also carefully cultivated ties with far-right governments in Poland and Hungary to sabotage the EU's attempts to criticise or sanction Israel, despite the fact that the leadership of both countries, most notably Viktor Orban, have been widely accused of anti-Semitism.

EU action may impact US relations 

While any acceptance of Israel's annexation policies would undermine Europe's credibility, the far greater problem, according to Hever, is the stance of the US, which, under the current administration, has adopted a new approach that openly supports the acquisition of territory through force. This has already impacted the policies of the Hindu nationalist Narendra Modi government in India and the government of Recep Tayyip Erdogan in Turkey.   

The emergence of an internationally recognised situation of apartheid will affect the EU's relationship with Israel and its main supporter the US

The disappearance of the two-state solution, and the emergence of an internationally recognised situation of apartheid, will have deeper repercussions over the long term, affecting the EU's relationship with Israel and its main supporter the US. Since the US is ruining its relationships with the EU anyway, and sabotaging bilateral and multilateral channels of cooperation, the EU, in Hever's opinion, has no reason to think that sanctions against Israel will further harm relations with the US. 

While the EU has had a rocky relationship with the current Trump administration over a number of issues, Hassan thinks that Europeans are not interested in opening up another front with Washington, although, with a new Democratic administration in the White House, those fears might be abated. 

However, it is still unclear what any  would do if Europe moved forward with punitive measures in the face of Israeli annexation. The Biden campaign has indicated that his potential administration would be against conditioning US aid to Israel, but that doesn't necessarily mean it would go after third countries that seek to meet their international legal responsibilities. 

What's next? 

While there is already a one state reality in terms of institutional and systemic ethno-religious discrimination, the question remains of how long it will take before it might be transformed into a state where both Palestinians and Israelis would enjoy equal rights and self-determination.

"If we say that Israel made the two-state solution no longer viable, we are also saying that Israel could find a way to make a democratic binational state no longer viable. Neither is acceptable," Hever says.  

While the Palestinians have not yet made their choice, the Israeli public, according to him, does not want "two-states nor one bi-national one, but rather apartheid and status-quo."  

In his opinion, one democratic state is the best mechanism for implementing restorative justice measures for implementing the right of return of Palestinian refugees and for building a civilian (i.e. not military) economy to overcome social inequalities and a sustainable future. 

While it is clear that sustained and strategic international pressure could stop Israel's annexation plans, the role of the US is crucial as the only third-party mediator able to exert meaningful pressure on Israel. 

However, the Trump administration is ardently pro-Israel, and has already moved the US embassy to Jerusalem, endorsed Israel's occupation of the Golan Heights, and proposed a disastrous peace plan green-lighting annexation of the West Bank.

Stasa Salacanin is a freelance journalist who has written extensively on Middle Eastern affairs, trade and political relations, Syria and Yemen, terrorism and defence