Israel on Sunday stepped up its battle with the EU over its decision to label products from the settlements, with Prime Minister Benjamin Netanyahu suspending diplomatic contacts regarding the Middle East peace process pending completion of a “reassessment” by the Foreign Ministry of the EU's role in that process.

According to a Foreign Ministry statement, Israel will continue to have diplomatic contacts with individual EU countries – such as Germany, Britain and France – but not with EU institutions. Netanyahu is scheduled to meet with French President François Hollande and new Polish Prime Minister Beata Szydło in Paris on Monday.

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The Foreign Ministry spokesman did not provide details of any other practical consequences stemming from the decision, such as whether this would mean that Netanyahu would not meet with EU foreign policy chief Federica Mogherini on issues pertaining to the Palestinians. The decision comes at a time when there is very little movement in the diplomatic process with the Palestinian Authority.

The EU, meanwhile, had no immediate response, with one EU official saying that the organization is first trying to understand the implications of the statement.

Soon after the EU decided earlier this month to label products from the settlements, Jerusalem decided to suspend diplomatic dialogue with the EU for a few weeks to strongly protest Brussel’s decision.

The EU has consistently downplayed the impact of the guidelines, saying it was only a “technical matter.” An EU commission spokesman said earlier this month the labeling would simply “ensure the uniform application of the rules concerning the indication of origin of Israeli settlement products. The aim is to ensure effective implementation of existing EU legislation.”

The guidelines provide member states with legal instructions as to the placement of consumer labels on products from the West Bank, east Jerusalem and the Golan Heights to inform European consumers that they are not “made in Israel.”

The move infuriated Jerusalem, which said it paves the way to a boycott of Israeli products.

At the recent Jerusalem Post Diplomatic Conference in Jerusalem, Netanyahu blasted the EU’s decision, calling it “absolutely absurd and morally abhorrent, because on the soil of Europe within living memory, Jewish products were labeled, Jewish stores were labeled.”

EU Ambassador to Israel Lars Faaborg-Andersen hit back at the conference against any comparisons with Nazi boycotts of Jewish businesses, saying this was a “distortion of history and belittlement of the crimes of the Nazis, and the memory of their victims.”

Faaborg-Andersen unequivocally refuted claims that the settlement labeling was tantamount to a boycott of Israeli products.

“Talk of a European boycott just does not stand up to a reality check. Let me say loud and clear: Europe is not boycotting Israel, and Europe is not boycotting settlements,” he said.

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