France, Aug. 21 -- In a joint statement released on Thursday, Paris, Berlin, Rome and London said the move was particularly concerning at a time of heightened instability in the West Bank, citing rising settler violence and growing pressure on the Palestinian economy.

"At a time when the West Bank is experiencing serious instability, with unprecedented levels of violence committed by settlers against civilians and severe restrictions imposed on the Palestinian economy, this decision is all the more worrying," the four countries said.

France and its European partners warned that the E1 development could further undermine hopes for a negotiated two-state solution by weakening the territorial continuity of a future Palestinian state.

"The...