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Local councils that boycott Israeli companies could be sued

Firms hurt by BDS could take authorities to court, says Steve Reed, Secretary of State for Housing, Communities and Local Government

January 4, 2026 11:29
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2 min read

Local authorities that support the “boycott, divestment and sanctions” (BDS) movement could face legal action from affected companies, the communities secretary has warned.

Several Labour-run councils have voted to block Israeli or Israel-linked companies. The Secretary of State for Housing, Communities and Local Government, Steve Reed, has told councils they risk being sued by companies that lose money as a result of boycotts, and warned that authorities could be forced to pay damages.

“Councils should stay out of foreign conflicts and get on with the job of delivering local services,” Reed said, according to the Telegraph on Saturday.

The government has published guidance prohibiting boycotts against Israeli firms and has said companies would be able to sue councils under the Procurement Act 2023.

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