Senators Urge SEC to Investigate Unilever Over Ben & Jerry’s Israel Boycott
Three Republican senators have urged the Securities and Exchange Commission (SEC) to investigate whether Unilever and its subsidiary, ice cream maker Ben & Jerry’s, deceived shareholders and violated SEC rules after the latter decided to stop selling products in territories it considers to be illegally occupied by Israel.
Sens. Thom Tillis of North Carolina, John Kennedy of Louisiana, and Tim Scott of South Carolina — all members of the Senate Banking, Housing, and Urban Affairs Committee — wrote to SEC Chairman Gary Gensler in a December letter that was published by FOX Business on Wednesday. The senators drew attention to statements made after Ben & Jerry’s announced on July 19, 2021, that it would end ice cream sales in “Occupied Palestinian Territory” — namely eastern Jerusalem and the West Bank.
Ben & Jerry’s said that despite the move, it does not endorse the Palestinian-led Boycott, Divestment, Sanctions (BDS) campaign, which seeks to completely isolate Israel, and committed to staying in the country “through a different business arrangement.” Unilever supported its subsidiary’s decision, saying, “we also welcome the fact that Ben & Jerry’s will stay in Israel.” The British conglomerate further insisted that it “remains fully committed to our business” in the country.
However, “there is strong reason to believe that these July 19 statements were knowingly and recklessly false,” the lawmakers wrote. “It is a reasonable assumption that these statements were orchestrated by Unilever and its wholly-owned subsidiary, Ben & Jerry’s, to deceive shareholders and avoid violating state anti-BDS laws that would trigger mandatory divestment of the companies by state public pension funds.”
They argued that Unilever and Ben & Jerry’s violated SEC Rule 10b-5(b), which says it is unlawful “to make any untrue statement of a material fact or to omit to state a material fact necessary, in the light of circumstances under which they were made.”
The senators also alleged that Ben & Jerry’s knew their decision violated an Israeli law that prohibits companies from conducting business in the country while also participating in a partial boycott. “Ben & Jerry’s can stay and sell in all of Israel, including the OPT [Occupied Palestine Territory] referenced in the firm’s July 19 statement, or it can leave Israel entirely,” their letter read. “But it cannot remain in the country in the way it publicly said it would: partially-in, partially-out.”
An investigation into the statements made by Ben & Jerry’s and Unilever is necessary to “defend the integrity of US markets,” the senators wrote to Gensler.
The head of Ben & Jerry’s Independent Board of Directors indicated in July that the group did not approve a commitment to remain in Israel, calling Unilever’s statement on the matter “stunning.” The board’s original message announcing the boycott included no guarantee to stay in the Jewish state.
In November, a bipartisan group of lawmakers from the United States House of Representatives called for a similar SEC investigation into Unilever and Ben & Jerry’s over its boycott decision.