The European Union foreign policy chief has criticized Israel's decision to freeze $125 million in Palestinian tax revenues, in response to Palestinian efforts to join the International Criminal Court.
Federica Mogherini said on Tuesday the tax freeze "runs counter to Israel's obligations" under the 1994 Paris Protocol. She also said the move puts EU initiatives to help the Palestinians at risk.
The EU is a major source of financial aid to the Palestinian Authority.
Mogherini also said both the Israelis and Palestinians should refrain from taking actions that could aggravate an "already tense situation." She did not mention the Palestinians' bid to join the ICC.
The Palestinians rely on a monthly tax revenue transfer from Israel to run their government and pay the salaries of civil servants.
Israel announced the tax freeze last week after Palestinian officials submitted documents to the United Nations to join the International Criminal Court, a move that will enable them to seek war crimes charges against Israel.
Israeli Prime Minister Benjamin Netanyahu threatened to retaliate for the Palestinians' efforts to join the ICC.
Palestinian President Mahmoud Abbas signed the documents after the U.N. Security Council rejected a draft resolution setting a three-year deadline for the establishment of a Palestinian state on lands occupied by Israel after the 1967 war.
The United States has said it is deeply troubled by the Palestinian action and has criticized Israel for the tax freeze.
By becoming members of the ICC, the Palestinians could also open themselves up to counter-charges of war crimes from others.
After years of discussion by U.N. members, the ICC was formed in 1998 when 120 countries adopted the Rome Statute. The court is considered an independent judicial institution without supervision by the United Nations.
The ICC prosecutes suspects accused of genocide, war crimes and other crimes against humanity. It has no power to make arrests but does have the authority to issue arrest warrants, which could make it a problem for suspects to travel.