Diplomatic sources confirmed that the Committee of Permanent Representatives (COREPER) failed to reach a consensus to begin the process.
The above mentioned countries demanded more time to assess at the proposal.
Analysts point out that the division shows tensions within the bloc between those who prioritize political pressure and those who seek to maintain talks with Tel Aviv.
Former German Chancellor Olaf Scholz recently warned of the risk of escalation.
To be approved, the sanctions require support of at least 15 member states representing 65 percent of the European population.
The European Commission previously recommended excluding Israel from the Horizon Europe program, citing violations of international law in Gaza.
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