France's Orange plans to end brand licensing deal in Israel

Israel protested to France on Thursday after the head of partly state-owned French telecom giant Orange said it intended to end a brand-licensing deal with an Israeli firm, drawing accusations that Orange was bending to a pro-Palestinian boycott movement.

Commenting on remarks in Cairo on Wednesday by Orange CEO Stephane Richard, the French company said in Paris that terminating the arrangement with Israel's Partner Communications was a business decision, not a political one.

Media reports quoted Richard as saying at a news conference in the Egyptian capital that he was willing to withdraw the Orange brand from Israel "tomorrow morning," but that moving too quickly would expose his company to legal risks and possible financial penalties. 

"I know that it is a sensitive issue here in Egypt, but not only in Egypt,” he was quoted as saying, referring to Orange's deal with an Israeli company. “We want to be one of the trustful partners of all Arab countries." Orange, one of the world's largest telecom companies, provides mobile phone services in about 30 countries. 

The remarks struck a nerve in Israel, which fears international attempts to isolate it diplomatically and economically over the stagnation of talks on founding a Palestinian state in territories Israel occupied in the 1967 war, and because of its construction of Israeli settlements in Palestinian territories, which is illegal under international law.

Israeli Prime Minister Benjamin Netanyahu on Thursday demanded France "publicly renounce the distressing statement and action" taken by Orange. The French government holds a 25 percent stake in the company.

On Friday, French Foreign Minister Laurent Fabius said France opposed any boycott of the Jewish state but stressed Orange was free to define its own policy.

"While it is up to the president of the Orange group to define the commercial strategy of its company, France is firmly opposed to any boycott of Israel," he said in a statement. 

Orange issued a statement in Paris Thursday saying that in line with its licensing policy, it does not want to keep its brand presence in countries where it is not an operator.

The company said that Richard's comments had been taken out of context, and that the move should not be interpreted as being driven by the Boycott, Divestment and Sanctions (BDS) movement — a push, sponsored by pro-Palestinian intellectuals and bloggers, to pressure Israel to change through international economic pressure. Israel and many of its supports allege the movement is motivated by anti-Semitism and a desire to paint Israel as illegitimate.

BDS campaign organizers argue that it is not anti-Semitic to criticize government policies, and they believe that accusations of anti-Semitism are a tactic to avoid criticism. The movement accuses Israel of denying basic human rights to Palestinians, and is modeled after a similar international initiative to boycott South Africa during its apartheid era.

Many Palestinians say such tactics are necessary after more than 20 years of failed peace efforts. With more than half a million Israelis now living in settlements in the West Bank and east Jerusalem, they say that time is running out for a two-state solution.

"The Israeli reaction to the boycott movement means that our political movement began to affect them and to scare them," said Nabil Shaath, a senior Palestinian official.

The BDS movement has been active in France, and staged a protest at Orange's annual shareholder meeting last month. Activists have also called attention to activities in Israel of French companies Danone, L'Oreal, hotel chain Accor and energy company Veolia.

France's Foreign Ministry declined to comment specifically on Richard's comments. But it reaffirmed that France is against any boycott of Israel, while viewing as illegal the settlements it has built in occupied territory, where Partner and other Israeli phone companies also operate.

Al Jazeera and wire services