In the aftermath of the European Union's decision last month to issue guidelines on labelling Israeli products from outside the pre-1967 border lines, Prime Minister Benjamin Netanyahu instructed the Foreign Ministry to suspend engagements with the EU over all matters related to the diplomatic process with the Palestinians.
It is not clear exactly what form the suspension will take, especially as Israeli diplomats stressed that Israel would continue to discuss these matters with major members of the EU such as the UK, Germany and France.
It is expected that the main impact will be on relations with the EU's foreign service itself and with a number of countries within the union that have been more active on pressing for sanctions against Israel and for the recognition of Palestinian statehood.
Some Israeli diplomats said that this may amount to little more than a period of "reassessment" and, after that it would be back to "business as usual".
