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European Court of Justice Ruling: British Boycott of Oil Sales to Israel Does Not Violate Eec Law

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Britain’s oil export policy, which effectively boycotts sales to Israel, does not breach the law of the European Economic Community, the European Court of Justice in Luxembourg has ruled.

The ruling last week is the latest, and possibly final step, in a five-year legal battle between the Swiss based Bulk Oil Trading Company, which buys oil for Israel, and Sun Oil, a major American oil company which operates in the North Sea.

Sun had sued Bulk for about $15 million in damages over the cancellation of an oil delivery after it transpired that the oil was bound for Israel, and therefore contrary to the British government’s export guidelines.

But although the British courts ruled in favor of Sun, they allowed Bulk to appeal to the European Court over whether Britain’s oil export policy breached the 1975 Free Trade Agreement between Israel and the European Common Market.

After two years of deliberations the European Court last week rejected Bulk Oil’s appeal. However, it also criticized Britain for failing to register its export policy with the European Commission.

It remains to be seen whether Sun Oil can recover the damages which it expects following the ruling. Bulk Oil says that its affiliate mentioned in the case, Bulk Oil (Zug), ceased trading more than four years ago.

CLARIFICATION The February 26 Bulletin reported that Ernest Michel will serve as executive vice president of the UJA-Federation of New York following the merger of the United Jewish Appeal and the Federation of Jewish Philanthropies of New York, on July I. It should have read that William Kahn and Michel will serve as vice presidents.

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