NORWAY - An Israeli property company that failed to engage with the Norwegian Pension Fund Global is to be excluded from the scheme's investment universe over concerns it is violating the Geneva Convention, the Norwegian government has said.

In a statement, the ministry of finance noted that Shikun & Binui - listed on the Israeli stock exchange with a 57% stake owned by private local investment company Arison Group - was excluded after a recommendation late last year from the fund's Council of Ethics.

In its guidance to the ministry, the council said that Shikun & Binui, either directly or through its subsidiary Solel Boneh, was involved in settlement construction work in East Jerusalem and the West Bank, with the subsidiary participating in the construction of the separation barrier in 2004.

Referring to statements by the International Court of Justice, the UN Security Council and the Red Cross, the Council of Ethics said building Israeli settlements in either area was "in breach of the IV Geneva Convention".

It continued that there was "wide international consensus" that settlement construction in the West Bank and East Jerusalem - both deemed occupied territories - was illegal.

"In the view of the Council, companies that build such settlements may be excluded from the GPFG," it added.

"In its deliberations of such cases, the Council does not distinguish between the building of settlements in East Jerusalem and in the rest of the West Bank."

Shikun & Binui was sent a number of letters by the council, although these went unanswered, resulting in the exclusion.

At the end of last year, the NOK3.5trn (€458bn) scheme's holdings were valued at NOK8.5m.

The NPFG has previously divested from companies it deemed to be undertaking construction work in occupied territory - also found in breach of the fourth Geneva Convention - while the Dutch asset manager PGGM has engaged with a number of companies over their activities in the occupied territories in Israel.

Topics