Palestinian Prime Minister Rami Hamdallah sent US Secretary of State Mike Pompeo a letter in late December rejecting future American financial assistance, citing the 2018 US anti-terrorism law ATCA.
The Anti-Terrorism Clarification Act, which was signed into law by President Donald Trump back in October and recently approved by the US Congress, would enable American authorities to seize assets from any foreign “terrorist entity” that receives financial aid from the US government. The law also means that any US citizen could sue the PA for involvement in terror activity and be compensated by the money earmarked for PA financial aid.
The bill's sponsor, Senator Chuck Grassley (R-IA), in September 2018 called the legislation "a carefully balanced approach to better ensure victims' access to compensation and to hold supporters of terrorism accountable."
Indeed, in his December 26 letter, obtained by Ynet, Hamdallah said that while the Palestinians were grateful for the long-standing American financial assistance, and that the "bond between the Palestinians and the American people will always be strong," the new law made the aid a "dividing force" as it changes the "rules of jurisdiction over the Government of Palestine."
The PA turning its back on the aid, in order to avoid being subjected to controversial lawsuits, also likely sees an end to funds meant to preserve the coordination between the PA and Israeli security forces in the West Bank. As a result, the PA and its security forces might themselves destitute, which would not only end the cooperation with Israel but also significantly strengthen Hamas in the West Bank and unleash a wave of terror attacks.
Over the past few weeks, the Trump administration was reportedly scrambling to amend the legislation in order to ensure the US security assistance to the PA continues.
A senior Israeli official told Ynet that Israel has also been working behind the scenes to ensure the law was amended, and once the US Congress returned from the Christmas break, there was a “reasonable” chance the legislation will indeed undergo the necessary changes.