Florida, Illinois, New York and Arizona have implemented the proscriptions against the Co-op, which has suffered a series of controversies since adopting its policy five years ago.
Co-op supermarkets in Britain have refused to stock products from Israeli West Bank settlements since 2009, and the policy was extended in 2012 to include barring any engagement with Israeli suppliers known to work with the settlements.
Arizona included the Co-op on a “prohibited investment list” in March, alongside a series of financial firms and banks.
New York State’s office of general services listed it as one of more than a dozen “institutions or companies determined to participate in boycott, divestment or sanctions activity targeting Israel” in May, as did Illinois’ investment policy board.
The State Board of Administration of Florida said it had scrutinised the Co-op after being directed to create a “list of companies that participate in a boycott of Israel, including actions that limit commercial relations with Israel or Israeli controlled territories”.
Luke Akehurst, director of the We Believe in Israel grassroots group which campaigns against boycotts, said: “The Co-op Group’s boycott of certain Israeli suppliers has done nothing to advance peace and coexistence or to help the Palestinians.
“All it has achieved is to alienate Jewish and other pro-Israel customers from the Co-op and now to get them added to a list of BDS-supporting companies that several US states can’t invest in.
“They need to drop this damaging and divisive policy and instead contribute positively to supporting their sister Co-operative movements in Israel and the Palestinian Authority.”
Explaining its policy on its website, the Co-op said that “exceptional circumstances” meant it had withdrawn trade from “the Israeli settlements in the Occupied Palestinian Territories”.
“On this basis, we do not source any produce or own-brand products from the Israeli settlements. We can categorically state that this position does not constitute a boycott of Israeli businesses. We remain committed to sourcing produce from and trading with Israeli suppliers that do not source from the settlements.”
Almost half the US Senate and more than 50 per cent of the House of Representatives signed a proposed bill last month which, if it becomes law, would ban boycotts of Israel. Companies which violate the bill could face fines of up to $1 million and executives could be jailed.
