The Palestinians threatened Wednesday to sue Israel through international bodies if it continues expanding settlements in the occupied territories, warning it was an issue that could torpedo fledgling peace talks.
"These are not just dots on a map," PLO executive committee member Hanan Ashrawi said of more than 2,000 new settler homes which were approved for construction ahead of a resumption of peace negotiations late last month.
"These are wilful and destructive measures to prevent the creation of a Palestinian state.
"If Israel carries out these plans... we will be forced to have recourse to international judicial processes through international institutions," she told reporters near the settlement neighbourhood of Gilo, south of Jerusalem, where many of the new units are to be built.
Israeli and Palestinian negotiators held a new round of peace talks in Jerusalem on Tuesday, their second since the resumption of direct negotiations in Washington late last month which ended a nearly three-year gap.
The last talks, in September 2010, broke down over the issue of settlement expansion.
"There has been no breakthrough and no agreement. Discussions have not been on specifics," Ashrawi said of the resumed talks.
Details of the discussions have not been revealed at the request of US mediators, who asked last week for a strict news blackout.
Ashrawi warned that Israeli settlement building threatened once again to torpedo peace efforts.
"We are not prepared to make the same mistakes and to have talks for their own sake as Israel continues... unilateral measures" such as further settlement building, she said.
She urged the United States to take a firm stance against settlements, following the example of the EU.
"The EU guidelines are just the beginning of holding Israel accountable for settlement building. We call on all other countries to persist in holding Israel and the settlers accountable," Ashrawi said.
The EU published guidelines last month that forbid its institutions from dealing with or funding any West Bank settlements.
The US and Israel voted against the motion.
Netanyahu on Friday played down the settlements issue.
"The root cause of the conflict was and remains the persistent refusal to recognise the Jewish state in any boundary," he said.
"It doesn't have to do with the settlements -- that's an issue that has to be resolved -- but this is not the reason that we have a continual conflict."
In the last significant attempt to work through international bodies, the Palestinians gained upgraded status at the UN in November, with an overwhelming majority of countries voting in favour of their becoming a non-member observer state.