Ben & Jerry’s to Stop Selling Ice Cream in West Bank Settlements, East Jerusalem

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Ben & Jerry’s said it would stop selling its products in the Israeli-occupied West Bank and parts of contested East Jerusalem when its license agreement expires, as the Ice cream maker takes another activist stance.

Sales in the settlements of Palestinian territories were “inconsistent with our values,” the company said Monday in a statement on its website.

Israeli Prime Minister Naftali Bennett denounced Ben & Jerry’s move. “This decision is morally wrong and I believe that it will become clear that it is also commercially wrong,” he said on Twitter.

Ben & Jerry’s, a unit of

Unilever

UL -0.96%

PLC, won’t renew its agreement with its licensee in Israel, which manufactures and distributes ice cream in the region. The company said that after the agreement expires at the end of next year, it will make a different arrangement to stay in Israel.

Israel captured East Jerusalem and the West Bank in the 1967 Mideast war. Around 700,000 Jewish settlers live in those areas. Israel considers East Jerusalem as part of its capital, while Jewish settlements in the West Bank are still technically under military occupation authority. In practice though, the settlements are treated largely the same as the rest of Israel and supported by the government.

The international community considers both areas to be occupied territory.

Commenting on Ben & Jerry’s step, the Israeli Foreign Ministry said, “The decision is immoral and discriminatory, as it singles out Israel, harms both Israelis and Palestinians and encourages extremist groups who use bullying tactics,”

Israel’s foreign minister,

Yair Lapid,

said he would ask more than 30 U.S. states to enforce laws passed in recent years requiring states to divest from companies that boycott Israel.

Pro-Palestinian activists have long campaigned to get companies to boycott Israeli settlements, but few companies have recently taken the move. In 2018,

Airbnb

said they would remove all listings on their website in Israeli settlements, only to reverse the move a few months later following intense pressure from the Israeli government and a lawsuit in a federal U.S. court.

Ben & Jerry’s, founded in 1978 by Ben Cohen and Jerry Greenfield and acquired by Unilever in 2000, has long touted values such as human rights and economic justice. As part of its acquisition by Unilever, Ben & Jerry’s and its independent board retained the right to make decisions about its social mission.

In a statement on Monday, Unilever called the Israeli-Palenstinian conflict a “very complex and sensitive situation,” and said it was fully committed to its presence in Israel and welcomed Ben & Jerry’s plans to stay in Israel.

Ben & Jerry’s Chief Executive

Matthew McCarthy

has supported former football star Colin Kaepernick in his protest against police brutality and racial inequality and wrote an op-ed that supported legislation to consider the possibility of paying reparations to descendants of enslaved people in the U.S.

In the past year, leaders at some of the world’s biggest corporations have taken a stand on issues including immigration, voting rights and climate change, amid pressure from employees, customers and shareholders. 

Earlier this year, more than 100 CEOs and senior business leaders joined a call to plan a response to new voting laws in dozens of states, with

Kenneth Chenault,

former chief executive of American Express Co., and

Kenneth Frazier,

CEO of Merck & Co., urging action on greater voting access.

Write to Kimberly Chin at kimberly.chin@wsj.com

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