EU talks with Israel on upgrading ties put on hold

JERUSALEM (Reuters) - The European Union and Israel have put negotiations on upgrading their ties on hold due to the war in the Gaza Strip, an EU envoy said on Wednesday.

Bilateral relations have been tested by Israel's 19-day-old military offensive in the Hamas-ruled coastal enclave, in which nearly 1,000 Palestinians have been killed.

Ten Israeli soldiers and three civilians hit by Hamas rockets fired across the border have also died since December 27.

Ramiro Cibrian-Uzal, the EU commission's ambassador to Israel, told reporters in Jerusalem that the war in the Gaza Strip meant bilateral relations between Israel and the 27-nation bloc "cannot proceed business as usual."

Cibrian-Uzal did not say how long the "mutually agreed time-out" in the negotiations would last.

Israeli Foreign Ministry spokesman Yigal Palmor said some talks had been due to take place but both sides agreed that "now is not the time," describing the postponement as "technical."

"This will resume as soon as we're all ready and set our minds to it," Palmor said.

The EU agreed last year to upgrade political and trade ties with Israel despite protests by Palestinian officials.

But EU officials pointed to wording in the agreement loosely linking any moves to implement it with progress in peace efforts.

"In a war situation, in a situation in which Israel is at war, using its war means in a very dramatic way, in a powerful way in Gaza, everybody realizes that it is not the appropriate time to upgrade bilateral relations which normally take place in a more ... peaceful context," Cibrian-Uzal said.

He dismissed any suggestion that this amounted to a "sanction" against Israel over the war. "The European Union has never contemplated, to my knowledge, has never seriously envisaged sanctions," Cibrian-Uzal said.

Czech Foreign Minister Karel Schwarzenberg, whose country's holds the EU presidency, said the decision to upgrade ties with Israel was taken by EU ministers and any change in this policy could only be made by them.

However, he told the European Parliament: "I admit for the moment in this situation I do think it's premature to discuss how an upgrading of relations with Israel should go on and if there should be a summit in the foreseeable future.

"For the moment we have really more important and more urgent and important questions to solve."

One senior EU diplomat said this week that European leaders would face a public outcry now if they firmed up a tentative plan to meet Israeli leaders at a summit in the coming months.

"The fact that there are no (upgrade) activities goes down to the situation on the ground," an official for the Czech EU presidency said.

Large protests have taken place in European capitals against the Israeli military strikes.

In a newspaper interview, EU Aid Commissioner Louis Michel called the Israeli offensive "totally disproportionate" and in breach of international humanitarian law.

(Reporting by Adam Entous in Jerusalem and Mark John and David Brunnstrom in Brussels)