S.5476 - A bill to impose sanctions with respect to foreign persons that have facilitated Israeli settlement construction in the E1 area of the West Bank.
S.5476 was introduced September 23, 2026 by Senator Chris Coons (D-DE). It is pending before the Committees on Banking, Housing and Urban Affairs and has 18 co-sponsors on a partyline basis
Bill Summary: S.5476 would require the imposition of sanctions on foreign persons involved in Israeli settlement construction in the E1 area of the West Bank. Beginning 30 days after enactment, the President would be required to impose sanctions on foreign persons the Secretary of the Treasury, in consultation with the Secretary of State, determines to have been responsible for, complicit in, or engaged in settlement construction in E1, including by submitting a bid for E1 tenders on or after August 18, 2026, guaranteeing such a bid, signing related development or lease agreements, or providing contracting or professional services; to have invested in or built infrastructure such as roads, water, sewage, or electricity systems that facilitates E1 settlement; to have organized, financed, or facilitated the transfer of Israeli civilians into E1; to have knowingly facilitated related financial transactions; or to be a leader or official of any entity, including a government entity, engaged in these activities. The President would also be authorized to sanction persons who materially support, or are owned or controlled by or act on behalf of, sanctioned persons. Sanctions consist of the blocking of property and interests in property subject to U.S. jurisdiction under the International Emergency Economic Powers Act, with civil and criminal penalties applying to violations. S.5476 exempts humanitarian transactions and authorized U.S. intelligence activities, and sunsets after seven years.
Context: In August 2025, Israel's Higher Planning Council approved 3,401 housing units in the E1 area of the occupied West Bank, a project frozen for decades under U.S. and European opposition due to its explicit use as a means to cut off Palestinian territorial contiguity between Northern and Southern regions of the West Bank. Finance Minister Bezalel Smotrich said the approved E1 plan "will bury the idea of a Palestinian state." Weeks later, the government committed funding to some 7,600 units across E1 and Ma'ale Adumim, the settlement whose municipal boundary contains E1. At the signing, Prime Minister Benjamin Netanyahu declared, "There will be no Palestinian state! This place is ours." Ma'ale Adumim was founded in 1975 by 23 families and is now home to roughly 40,000 Israelis; together with E1, it covers about 3% of the West Bank, in the triangle between Jerusalem, Bethlehem, and Ramallah. E1 housing is one piece of a broader plan to take control of that area. In March 2025, Israel's Security Cabinet allocated NIS 335 million for the "Sovereignty Road" between al-Eizariya and al-Za'ayem, which would divert Palestinian traffic onto a separate route and allow Israel to close the entire Ma'ale Adumim and E1 area to Palestinians. In May 2026, the Civil Administration demolished dozens of Palestinian businesses at the entrance to al-Eizariya to clear its path. On August 18, 2026, the government moved E1 into implementation by opening bidding on the first 1,234 units. Bidding was set to close October 19, one week before Israel's October 27 elections until the Government of Israel announced a pause on tenders due to concerns about electioneering and could resume thereafter. Completed, the project would connect the bloc to Jerusalem, divide the West Bank into northern and southern halves, and displace Bedouin communities that have lived in the area since the 1950s.
American Values Analysis: S. 5476 upholds American commitments to self-determination, equal treatment, and the rule of law. Article 49(6) of the Fourth Geneva Convention prohibits an occupying power from transferring its civilian population into occupied territory. It reaches those who organize, finance, or facilitate the movement of Israeli civilians into E1, and those who build the housing and infrastructure to receive them. The United States applied the same principle when it prohibited new investment in Russian-occupied Crimea: those who profit from the unlawful acquisition of territory should not have access to the American financial system.
American Interest Analysis: For decades, administrations of both parties treated construction in E1 as unacceptable because it forecloses the two-state solution. That policy depended entirely on executive discretion, and it has collapsed. In January 2025 the Trump administration revoked Executive Order 14115, the only U.S. sanctions program addressing threats to West Bank stability. Within months, Israel funded the Sovereignty Road and approved E1. S. 5476 begins to restore U.S. leverage. Its mandatory sanctions reach the bidders, guarantors, contractors, and banks the E1 tender depends on, as well as infrastructure, including roads, built with the purpose or effect of facilitating settlements
A New Policy’s Recommendation: SUPPORT
A New Policy supports S. 5476 as a necessary first step toward correcting U.S. policy in the West Bank. This bill sends a clear warning that U.S. lawmakers’ attitudes towards sanctions are changing. As potential investors in the E1 project are likely to take note of this change, this bill could have real consequences on the ground before passage. S. 5476 imposes mandatory sanctions, with no waiver, on those who build, finance, or facilitate the E1 settlement project. That establishes that participating in a project designed to foreclose Palestinian statehood carries real costs.
