The measure, formally titled the “Israeli Settlements in the Occupied Palestinian Territory (Prohibition of Importation of Goods) Bill,” would make it a criminal offense to import such goods into Ireland. Some anti-Israel critics of the bill note that it excludes services, which account for 70% of trade between Ireland and Judea and Samaria.

The bill, long stalled due to legal and political disagreements, was debated last week in the Dáil Éireann, the lower house of the Irish parliament, in the legislative process’s second stage. The Irish government, which supports the measure, has said it hopes to enact it before the Dáil’s summer recess in July.

A State Department spokesperson told JNS that Washington views the legislation as “unhelpful virtue signaling” that “does not serve the cause of peace in the Middle East, help feed Gazans, or work toward the outcomes Ireland says it seeks in the region.”

The spokesperson added that the measure “could encourage those who wish to see war return to Gaza” and “risks fueling antisemitism within Ireland.” The department also warned that “it could adversely affect American businesses operating in Ireland, and Irish companies operating in the United States.”

The concern reflects long-standing U.S. opposition to boycotts of Israel, both within its internationally recognized borders and in areas under its control.

Some analysts say the bill’s passage would force U.S. companies, which employ an estimated 245,000 people in Ireland, to close their Irish headquarters or other facilities to avoid running afoul of American law.

An Irish Department of Foreign Affairs regulatory impact analysis, published in recent days, acknowledged the bill could have “a potential impact on political engagement and a potentially significant adverse impact on Irish economic interests and operators,” given that the U.S.-Irish economic relationship is worth some $1.6 trillion, “with considerable U.S. foreign direct investment into Ireland.”

The proposed law has also drawn renewed attention in Washington. In October, 23 House lawmakers wrote to Irish officials warning of potential consequences if the measure advanced.

Rep. Josh Gottheimer (D-N.J.), the only Democrat to sign the letter, said last week that the bill is “a one-sided measure that singles out Israel while ignoring territorial disputes everywhere else in the world” and warning “it could come with a real cost” as American companies in Ireland “could be forced to choose between complying with Irish law and complying with anti-boycott laws in thirty-eight American states.”

While the regulatory analysis stressed that the Irish government’s position is that the bill “is not a boycott measure,” it allowed that “it is ultimately for the United States authorities to interpret the requirements of their own legislation.”

Ed Walsh, Washington’s ambassador to Dublin, told the Business Post on June 12 that the bill was a “political stunt,” the kind of which “don’t usually work out very well,” and a “big risk” for American companies that might have “unintended consequences for the ordinary Irish worker.”

The State Department spokesperson told JNS it is “monitoring developments closely.”