The E1 plan was green-lit by Israel last year and would further separate east Jerusalem, occupied and annexed by Israel and predominantly inhabited by Palestinians, from the West Bank.
The leaders of seven countries, including four EU member states, condemned a major settlement project in the West Bank and called on Israel to end expansion in the occupied Palestinian territory after authorities opened bidding for more than 1,200 homes in the area.
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"At a time of grave instability in the West Bank with unprecedented levels of violence by settlers against civilians, and serious restrictions on the Palestinian economy, this decision is even more concerning," the joint statement said, urging Israel "to retract these plans immediately and end its expansion of settlements in the West Bank."
The statement was signed by France, Germany, Italy and the Netherlands as well as the United Kingdom, Norway and Canada.
The E1 plan was green-lit by Israel last year and would further separate east Jerusalem, occupied and annexed by Israel and predominantly inhabited by Palestinians, from the West Bank.
The UN secretary general also said the E1 plan posed an "existential threat" to a contiguous Palestinian state.
Belgian Foreign Minister Maxime Prevot called the tenders "unacceptable" on Thursday, saying the project "would seriously undermine the viability of the two-State solution."
'Israel will defend its rights'
Prevot’s condemnation was echoed in a statement by UK Foreign Secretary Ed Miliband who demanded an end to the project and settlement expansion in the West Bank, with London summoning Israel's charge d'affaires.
Miliband said he delivered the message directly to his Israeli counterpart Gideon Sa'ar.
Sa'ar on Thursday said he rejected "outright" Miliband's statement and "the patronising tone of his words."
"The Jewish people have the right to live throughout the Land of Israel, just as the British have the right to live in London and throughout the United Kingdom," he wrote on X.
Sa'ar went on to accuse the UK of "blaming only Israel while ignoring Palestinian extremism" which he said was fuelling antisemitic attacks against the British Jewish community.
"The UK Government's decision to damage the relationship between our countries is deeply unfortunate," he added, vowing that "Israel will defend its rights, its interests and its people."
Israel approved the plans for the roughly 12-square-kilometre parcel of land known as E1 just east of Jerusalem, in August last year.
The plan seeks to build around 3,400 homes on the ultra-sensitive tract of land, which lies between Jerusalem and the Israeli settlement of Maale Adumim.
The latest tender covers more than 1,200 housing units, according to Israeli NGO Peace Now.
Peace Now said Israel's housing ministry published the tender on 18 August and immediately opened it for bids.
Submissions are due by 19 October, one week before Israeli elections scheduled for 27 October.
The group said the homes accounted for about one-third of the planned E1 development and accused the government of trying to advance construction commitments before the vote.
Israel heavily restricts the movement of West Bank Palestinians, who must obtain permits from authorities to travel through checkpoints to cross into east Jerusalem or Israel.
Last year, Britain and France were among 21 countries who condemned Israeli approval of the E1 project, calling it a violation of international law and urging Israel to reverse the decision.
Excluding east Jerusalem, the West Bank is home to around three million Palestinians. About 500,000 Israeli settlers also live there.
Violence against Palestinians by Israeli settlers has increased since the unprecedented 7 October 2023 attack on Israel by Hamas-led militants from the Gaza Strip.