	Introduction

This report provides information and analysis on the following:
Background on a "BDS" (boycott, divestment, and sanctions) movement against Israel. Private economic measures and product labeling policies—including those of the United States and European Union (EU)—that "differentiate" between (1) Israel in general and (2) entities linked with Israeli-developed areas and settlements in the West Bank, East Jerusalem, and Golan Heights (areas that Israel has controlled and administered since the 1967 Arab-Israeli war). Anti-BDS or antidifferentiation efforts to date, including federal and state legislation and proposals. Legislative considerations arising from existing antiboycott law, First Amendment issues, and issues regarding congressional powers over commerce and foreign affairs. Congress and the Trump Administration currently face a number of policy questions on these issues. For more information, see CRS Report RL33476, Israel: Background and U.S. Relations , by [author name scrubbed]. Background

		The BDS Movement

The BDS movement is generally seen as a loose grouping of actors from various countries who advocate or engage in economic measures against Israel or Israel-related individuals or organizations, though defining precisely what may or may not constitute BDS activity is subject to debate. Differentiation Between Israel and the Settlements

Debate is ongoing in the United States and elsewhere about whether economic "differentiation" (such as through product labeling policies) between (1) Israel proper and (2) Israeli-developed areas and settlements in the West Bank, East Jerusalem, and Golan Heights constitute a form of BDS. Some Members of Congress viewed the implementation of a policy of different labeling for goods from Israeli settlements in negative terms. 114-125 ) into law. The act contains a provision similar to the one in P.L. However, the Obama Administration asserted—including in a presidential signing statement—that certain provisions in P.L. 114-125 that seek to treat "Israeli-controlled territories" beyond 1949-1967 armistice lines (including West Bank settlements) in the same manner as Israel itself are not in line with U.S. policy. Participating in the BDS movement would not appear to place a U.S. organization in violation of existing federal antiboycott legislation, which targets organizations' participation in foreign boycotts. No foreign state has proclaimed that it participates in the BDS movement, and the movement does not have a secondary tier targeting companies that do business in or with Israel. Members might also consider legal and regulatory frameworks that Congress and the executive branch have used to designate actors of concern under various rubrics having to do with trade and/or national security. Potential First Amendment Issues Facing Laws Intended to Deter BDS Activity75

As discussed above, opponents of the BDS movement have proposed the enactment of legislation, either at the federal or U.S. state level, that would limit or deter participation in BDS-related activities and/or economic "differentiation" (between Israel and Israeli settlements). Some scholars and commentators have argued that legislation and other government action designed to deter or eliminate BDS activity potentially would raise First Amendment concerns, while others have argued that such action would be consistent with the First Amendment or would not implicate the First Amendment at all. Federal Preemption Questions: Commerce Clause and Foreign Affairs179

As noted above, some state and local governments have enacted or are considering measures to counteract BDS-related or differentiation measures. State and local economic sanctions meant to influence foreign politics ordinarily raise three related constitutional issues: (1) whether they are preempted by federal law under the Constitution's Supremacy Clause; (2) whether they burden foreign commerce in violation of the dormant Foreign Commerce Clause and, if so, whether they are protected by the market participant exception; and (3) whether they impermissibly interfere with the federal government's exclusive power to conduct the nation's foreign affairs. The constitutionality of any given state or local measure would depend upon the particulars of the legislation at issue. One bill in the 115 th Congress has been introduced to preserve state and local anti-BDS or antidifferentiation measures.
This report provides information and analysis on a boycott, divestment, and sanctions ("BDS") movement against Israel. The BDS movement is generally seen as a loose grouping of actors from various countries who advocate or engage in economic measures against Israel or Israel-related individuals or organizations, though defining precisely what may or may not constitute BDS activity is subject to debate.
The report also analyzes economic measures that "differentiate" or might be seen as differentiating between (1) Israel in general and (2) entities linked with Israeli-developed areas and settlements (whose legality is questioned under international law). Such settlements are found in the West Bank, East Jerusalem, and Golan Heights—areas that Israel has controlled and administered since the 1967 Arab-Israeli war. Debate is ongoing in the United States and elsewhere about whether economic differentiation (such as with regard to product labeling policies) between Israel proper and Israeli settlements constitutes a form of BDS.
The report also discusses
Anti-BDS or antidifferentiation efforts to date, including U.S. legislative action and proposals at the federal and state level. Legislative considerations arising from existing antiboycott law, First Amendment issues, and issues regarding congressional powers over commerce and foreign affairs.
These considerations present a number of policy questions for Congress and the Trump Administration. For more information, see CRS Report RL33476, Israel: Background and U.S. Relations, by [author name scrubbed].
The labeling of certain products imported from the West Bank is a subject with some connection to the debate regarding the BDS movement and economic differentiation. There appear to be some similarities between U.S. and European Union (EU) labeling laws and guidelines. Both jurisdictions call for the West Bank to be identified as the place of origin, but a November 2015 European Commission notice called for the labels for certain imports into the EU—Israel's largest trading partner—to provide additional information to EU consumers by further differentiating between products from Israeli settlements and from nonsettlement areas within the West Bank. This has fueled debate about whether the EU's guidelines might constitute, encourage, or foreshadow punitive economic measures against Israel.
In 2015 and 2016, President Barack Obama signed trade and customs legislation (P.L. 114-26 and P.L. 114-125, respectively) that opposed BDS-related measures against Israel. However, the Administration asserted—including in a presidential signing statement for P.L. 114-125—that certain provisions in the legislation that sought to treat "Israeli-controlled territories" beyond 1949-1967 armistice lines (including West Bank settlements) in the same manner as Israel itself were not in line with U.S. policy. Some legislation proposed in the 115th Congress contains similarly controversial language.
Participating in the BDS movement would not appear to place a U.S. organization in violation of existing federal antiboycott legislation, which targets organizations' participation in foreign boycotts. No foreign state has proclaimed that it participates in the BDS movement, and the movement does not have a secondary tier targeting companies that do business in or with Israel. If Members of Congress are inclined to propose legislation regarding BDS, they might consider using, as points of reference, legal and regulatory frameworks Congress and the executive branch have used to designate actors of concern under various rubrics having to do with trade and/or national security.
Opponents of the BDS movement or of economic differentiation have proposed the enactment of legislation that would prohibit the provision of public funding to U.S. corporations, academic institutions, groups, or individuals that engage in BDS activity. Some scholars and commentators have argued that such legislation would raise First Amendment concerns, while others have argued that such legislation would be consistent with the First Amendment. The constitutionality of a restriction on the availability of public funds would depend upon the particulars of the legislation at issue.
Some state and local governments have enacted or are considering measures to counteract BDS-related or differentiation measures. State and local economic sanctions meant to influence foreign politics ordinarily raise three related constitutional issues: (1) whether they are preempted by federal law under the Constitution's Supremacy Clause, (2) whether they burden foreign commerce in violation of the dormant Foreign Commerce Clause and, if so, whether they are protected by the market participant exception; and (3) whether they impermissibly interfere with the federal government's exclusive power to conduct the nation's foreign affairs. Some Members of Congress have proposed legislation intended to preserve state and local anti-BDS or antidifferentiation measures.