The European Union's decision to render parts of the municipality of Modiin-Maccabim-Reut as being "outside" of Israel's territory did not seem to faze the area's residents. "So they said we're settlers, so what?" said Shlomi Barel, the manager of a shopping plaza in Maccabim.
Israel says the entire district lies inside its boundaries. The EU determined that parts were built on what was no-man's land before Israel captured the area in the 1967 Six Day War.
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The EU says exports from the area will be treated like those from West Bank settlements and be ineligible for tax breaks granted to Israeli products.
The Foreign Ministry called the area "an integral part of Israel" and said the EU "ignores reality."
The EU said Wednesday only a small section of the district could be forced to pay customs.
"This isn't surprising," Barel said. "This was a political decision made by a body that is pro-Arab. I am not upset over the fact that they have turned me into a settler and I don't believe the decision will hurt local businesses. This area will continue to develop, and it will always be ours."
'Politics don't concern us'
Erez Gal, who owns a marketing company which does business with European countries, said "we do not know what the ramifications of this decision will be, but it does not appear that local businesses will suffer from it. I already spoke with a number of suppliers in Europe, and they were also under the impression that there won't be any significant change. We are traders; we are involved in trading, not politics."
But other residents fear the area's designation as a West Bank settlement could be damaging down the line. "It's like a snowball. It begins with this (EU decision) and ends with something far worse. I don't envision us being evacuated, but they will delegitimize us," said Modiin resident Adva Simchi.
The owner of a factory in the Shilat industrial zone called the EU's decision "troubling" and said he fears local business owners may have to remove the labels from their products, "as they do in the territories."
Modiin resident Bat-El Hasson told Ynet, "I am not a settler, and it feels strange to be called one. I suggest that EU representatives pay a visit and see for themselves that this is the heart of Israel. Calling it 'no man's land' is ridiculous."
AP contributed to the report