EU foreign policy chief Catherine Ashton is pushing for comprehensive guidelines to introduce separate labelling for products from Israeli settlements in the West Bank, a newspaper reported on Tuesday.
Ashton sent a letter to European commissioners urging them to draft the guidelines by the end of 2013, the Haaretz newspaper said.
In a separate move putting pressure on Israel, the EU last week published guidelines that forbid the 28 members of the bloc from funding or dealing with Jewish settlements in the West Bank and east Jerusalem which Israel occupied in the Six-Day 1967 war.
Haaretz quoted Ashton on Tuesday as saying in the letter that EU member states must ensure "the correct labelling of imported products originating beyond Israel's pre-1967 borders that are marketed as Israeli products."
"The Commission needs to ensure effective implementation of existing legislation relevant for the correct labelling of settlement products by adopting EU guidelines and other implementing acts."
Israel's foreign ministry spokesman Yigal Palmor said labelling settlement products is tantamount to "discrimination" against Israel.
"If it's necessary to inform the consumer of the origin of the product in question, the EU should put out universal laws for all disputed territories in Europe and all over the world. But making legislation for one single country or territory is institutionalising discrimination," he told AFP.
Ashton's spokeswoman confirmed EU intentions to label settlement products.
"We have committed to correctly implement the EU legislation relevant for origin labelling," Maja Kocijancic told AFP.
However, she said it was "too early to confirm the timeline for the next steps."
Another European official, speaking on condition of anonymity, said EU foreign ministers supported the labelling initiative, and also stressed there was no timeline.
"EU foreign ministers wish to have guidelines that would give indications" on how to proceed labelling settlement products, the official said.
"The work is currently ongoing and there is no real timeline. Nobody wants to give too concrete a timeline."
Settlement building in the territories occupied by Israel in the 1967 war is considered illegal under international law.
On July 19, the EU's Official Journal published a separate set of guidelines forbidding members from funding or dealing with settlements in any way.
"The EU does not recognise Israel's sovereignty over... the Golan Heights, the Gaza Strip and the West Bank, including east Jerusalem... and does not consider them to be part of Israel's territory, irrespective of their legal status under domestic law," the preamble to the guidelines said.
Israel has warned of a serious crisis between it and the EU over the move while commentators say the guidelines could pose a dilemma for Israel over whether to continue occupying the West Bank and risk damaging its relations with the international community -- not to mention its trade prospects -- or to comply fully.
According to 2012 World Bank figures, the EU imports 230 million euros ($300 million) of goods a year from Israeli settlements -- or 15 times more than from Palestinians themselves.