Luxembourg Drops Israeli Bond Approval, Ireland Faces Pressure

(MENAFN) Luxembourg has opted against renewing its authorization of Israeli state bonds, stepping back from the role that let the bonds reach investors throughout European markets, according to local media reports Tuesday.

The approval, granted by Luxembourg's financial watchdog, the Commission de Surveillance du Secteur Financier (CSSF), lapsed at midnight Monday. Luxembourg had assumed the oversight role in September 2025. With that authorization gone, Israel will need a different EU member state to sign off on its bond prospectus before it can keep marketing the bonds across the bloc.

That responsibility could fall back to the Central Bank of Ireland, which had previously served as Israel's designated "home" regulator for the bonds following the UK's departure from the EU, an Irish broadcaster reported. The Irish central bank has so far declined to confirm whether it has taken back the role or fielded a fresh application from Israel, saying only: "The prospectus that was approved by the CSSF has expired today."

Sinn Fein lawmaker Mairead Farrell pressed the bank for answers, saying, "We need urgent clarity from the Central Bank if a request for renewal of the Israeli bond prospectus has come to them from Israel and if this renewal has been accepted." She added, "We should have nothing to do with the funding of the genocide in Gaza."

Central Bank Governor Gabriel Makhlouf has previously insisted the institution lacks the authority to block the bonds from being issued. The bank has stressed it neither sells the bonds nor supervises their sale directly — its role was limited to checking whether the 2024 prospectus met EU disclosure standards.

Ireland's Finance Ministry said it had raised concerns with the European Commission and pushed for a possible overhaul of the EU's Prospectus Regulation. The Commission, however, signaled it has no current plans to revisit the legislation.

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