Israeli Officials Say Funding Fight with EU Resolved

Dispute over ban against giving money to institutions working in occupied areas

Israel has resolved a diplomatic spat with the European Union over a funding ban on institutions operating in occupied areas claimed by the Palestinians, Israeli officials said Tuesday.

The dispute had shaken Israel's relations with Europe, its biggest trading partner, and drawn attention to Israel's much-maligned policy of building settlements in the West Bank and east Jerusalem. The Palestinians claim both areas, captured by Israel in the 1967 Mideast war, as parts of a future independent state.

The dispute surrounded the EU's "Horizon 2020" program, which enables participants to apply for funds for research and collaboration in areas such as climate change, renewable energy and food safety. The EU has budgeted more than 70 billion euros ($95 billion) for the program, which is to run from 2014 to 2020, and officials estimate that Israel could gain 300 million euros ($400 billion) from the complicated funding system over the seven-year period.