The European Union published new guidelines yesterday for labelling products made in Israeli settlements, a move Brussels said was technical but Israel branded “discriminatory” and damaging to peace efforts with the Palestinians.

Drawn up over three years by the European Commission, the guidelines mean Israeli producers must explicitly label farm goods and other products that come from settlements built on land occupied by Israel if they are sold in the European Union.

The decision comes at a time of high tension between Israel and Palestinians. Twelve Israelis have been killed in attacks by Palestinians and more than 70 Palestinians, 44 of them assailants according to police, have been killed by security forces at scenes of attacks and many others in violent protests in the West Bank and near the Gaza border

The violence is in part fuelled by the occupation and the growth of settlements. Israeli officials, briefed that the decision was coming, were quick to denounce it. The foreign ministry said it was a political move designed to pressure Israel over its settlements policy. It summoned the EU ambassador to Israel and said it would suspend diplomatic dialogue in the coming weeks. Prime Minister Benjamin Netanyahu, who was in Washington on an official visit, called the decision “hypocritical and a double standard”, saying the EU was not taking similar steps in hundreds of territorial conflicts elsewhere in the world.

“The European Union should be ashamed of itself,” he said. “We do not accept the fact that Europe is labelling the side being attacked by terrorist acts.”