The decision follows mounting international pressure over the use of Israeli regime financing to support its genocidal war and military operations against Palestinians, particularly in the Gaza Strip.
Luxembourg’s financial regulator, the Commission de Surveillance du Secteur Financier (CSSF), allowed the authorization to expire on August 31 after deciding in May not to renew it.
The Israeli regime will now need to find another EU member state willing to approve its bond prospectus if it seeks to continue issuing bonds on European markets.
Israeli bonds, issued through the Development Corporation for Israel (DCI), represent loans to the Israeli regime and provide funding for its overall financial needs, including defence and military spending.
Following the Israeli regime’s October, 2023 war on Gaza, the bonds were marketed internationally as opportunities to “support Israel at War”.
According to Amnesty International, the Israeli regime raised $4.5bn through bond sales on international markets between October 2023 and January 2025.
Israel Bonds issued in the European Union raise about $2.5bn annually, according to the Israeli ministry of finance.
Previously, Ireland had served as the regulatory base for Israeli bonds in the EU after the United Kingdom left the bloc.
However, Ireland declined to renew its approval last year following pressure from parliamentary and civil society groups over the Israeli regime’s war on Gaza.
Luxembourg subsequently assumed responsibility for approving the prospectus before deciding not to renew it.
Meanwhile, the Israeli regime continues to have access to other international markets, particularly the United States, where the DCI has raised billions of dollars through bond sales since 1951.
Amnesty International has called on Luxembourg, Ireland and all EU member states to halt the sale of Israeli bonds, warning that states risk complicity in Israel’s ongoing genocide against Palestinians in the Gaza Strip.
Steve Cockburn, the regional director for Europe at Amnesty International, said the Israeli regime had become “increasingly reliant on foreign investments to finance its genocide, apartheid and unlawful occupation and bankroll its crimes against Palestinians”.
“Israel Bonds increase the funds available to the government and thereby help finance Israel’s genocide against Palestinians in the Gaza Strip that has wiped out entire families, levelled civilian infrastructure, including hospitals and schools and left 90 percent of the population forcibly displaced with their homes in ruins,” he said.
“Allowing these bonds to be sold in the EU markets comes with an enormous ethical and legal cost. International law is clear: All states have an obligation not to aid or assist in genocide and the obligation to prevent it,” Cockburn added.
Amnesty International also said the budget for the Israeli regime’s military increased from 4.2 percent to 8.3 percent of its gross domestic product between 2022 and 2024.