The European Union on Monday denied a report that claimed it had frozen a plan to label imported Israeli goods produced beyond the Green Line. But a diplomatic source in Jerusalem told The Times of Israel on Monday that the US probably did approach the Europeans and suggest they hold off the introduction of a labeling regime for settlement products.

A report in Haaretz on Sunday quoted “European diplomats and senior officials in Jerusalem” as saying that after US pressure the EU agreed to hold off on the move until the end of June.

But an EU spokesperson said legislation to label settlement goods was ongoing.

“Contrary to what was recently reported in the Israeli media, work on the effective enforcement of EU legislation with regard to the labeling of settlement products has not been delayed. Nor has the EU been asked to postpone such work,” a spokesperson of the EU delegation in Israel said in a statement Monday.

The Haaretz report quoted a senior Israeli official as saying that Jerusalem recently asked Washington to intervene, in an effort to block or delay the EU move to label settlement goods. According to the official, Israel even appealed directly to US Secretary of State John Kerry.

As a result of Israel’s lobbying, the implementation of the labeling scheme, which was expected to be approved at an EU Foreign Affairs meeting next week, had been delayed until June, the report said.

The EU commission made the initial decision to label settlement goods in May 2012, but is working on legislating guidelines to implement the decision.

According to European officials quoted in the report, the Americans said that the labeling plan would complicate renewed US and EU efforts to broker a peace deal between Israel and the Palestinians. The delay was conditional on progress in Israeli-Palestinian peace talks, and if no breakthrough is forthcoming, the EU will initiate the labeling plan, an Israeli official was quoted as saying.

Despite the EU’s insistence that no one asked it to postpone its labeling plans, a diplomatic source in Jerusalem told The Times of Israel on Monday that it was “likely” that the Americans approached the Europeans and suggested they hold off on any moves that could upset either side on the Israeli-Palestinian divide, including the introduction of a labeling regime for settlement products.

The EU has for several months been working toward enacting guidelines that would require retailers to label Israeli goods produced beyond the pre-1967 lines as not having originated in Israel. Several EU states, including the UK and the Netherlands, have declared their support for such measures; the South African government introduced similar steps recently.

Last week, former US president Jimmy Carter endorsed the EU’s plans to label settlement goods, saying such a measure would pressure Israel into restarting peace talks with the Palestinians. “The EU has repeatedly condemned settlement expansion in the West Bank. It could therefore introduce a clear labeling of products made in Israeli settlements, which are illegal under international law,” he said.

“The question of so-called labeling is one of the issues where the Europeans just want to make sure that, according to our consumer laws, the consumers have the information they want to have,” the EU’s special representative to the Middle East peace process, Ambassador Andreas Reinicke, told reporters in Jerusalem earlier this month.

The EU recognizes Israel only in its pre-1967 borders, and an increasing number of states are in favor of labeling Israeli products from the West Bank, East Jerusalem and the Golan Heights. While last year only one or two countries recommended that retailers label such goods, currently 13 of the EU’s 27 member states are considering similar measures, Reinicke said.

“The settlement issue for us Europeans is a very important issue because we are increasingly convinced that the increasing number of settlements endangers the two-state solution, because it makes it factually impossible,” Reinicke said.

Israel vehemently opposes any efforts to impose labeling requirements for settlement goods, arguing that such policies are discriminatory in that they single out Israel while ignoring territorial disputes elsewhere.

During a meeting with Reinicke on May 8, Deputy Foreign Minister Ze’ev Elkin tried to dissuade the ambassador from imposing a labeling regime on settlement products.

“Labeling products is a negative phenomenon that will ultimately hurt the Palestinian economy and the Palestinians who work in factories” in the West Bank, Elkin told Reinicke. “It’s too bad that this phenomenon is being allowed to expand instead of stopping it completely.”

Gavriel Fiske and JTA contributed to this report.