The European Union is considering sanctions against Israel, should the regime continue with illegal settlement expansion in the West Bank, hindering the two-state solution, Israeli media reported on Sunday.According to the PNN, the document is now being circulated between EU diplomats.

One such diplomat told Haaretz: ‘The peace process is in deep freeze, but the situation on the ground is not. There is big frustration in Europe and zero tolerance for settlement activity. This paper is part of the internal brainstorming being done in Brussels these days, about what can be done to keep the two-state solution alive.’

The document is said to discuss Israeli actions that would constitute a red line for the EU, especially construction of Israeli settlements in and around Jerusalem.

The document also notes the advancement of construction in the E1 area between the settlement town of Ma’ali Adummim and Jerusalem; construction of the Giv’at Hamatos neighborhood and additional construction in Har Homa south of Jerusalem, both of which are over the Green Line in Jerusalem.

EU officials believe that such construction puts at risk territorial contiguity of the Palestinian state and could make it impossible for Jerusalem to be the capital of both states.

Sanctions mentioned by the document, now in its initial stages of discussion, include marking products manufactured in the settlements in EU supermarkets; limiting cooperation with Israel in various areas; and restrictions on the free-trade agreement with Israel, said Haaretz.

Furthermore, the EU’s European External Action Service (EEAS) asked that distribution of the paper be limited. Israeli diplomats in a number of European capitals reported the existence of the document to the Foreign Ministry, but were unable to obtain it.

Over 550,00 Israeli settlers now reportedly live in illegal settlements across the occupied West Bank and Jerusalem.

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