The European Commission has proposed a partial suspension of an association agreement with Israel in a move designed as a rebuke of the country's government over its handling of the humanitarian situation in Gaza.

In her State of the European Union address on September 10, Commission President Ursula von der Leyen said the situation in the Palestinian enclave had shaken the world's collective conscious, adding: "man-made famine can never be a weapon of war. For the sake of the children, for the sake of humanity – this must stop."

In response to that call, the European Union's executive arm has taken action by putting forward a plan to suspend certain trade-related components of the Association Agreement that exists between the European Union and Israel.

The EU is Israel's largest trading partner, accounting for 32 percent of the country's total trade in goods.

"The proposed suspension targets tariff preferences granted to Israel encompassing free movement of goods, right of establishment and supply of services, public procurement, competition and intellectual property," said Maro? ?ef?ovi?, European Commissioner for trade at a press conference on Wednesday.

The Commission is also proposing sanctions on far-right Israeli ministers, violent settlers and Hamas members.

Israeli officials have criticized the proposal, saying it will help empower Hamas. But Commission officials say their intention is not to punish Israel, but to improve the situation on the ground in Gaza.

"The horrific events taking place in Gaza on a daily basis must stop. There needs to be an immediate ceasefire, unrestrained access for all humanitarian aid, and the release of all hostages held by Hamas," said von der Leyen.

"The European Union remains the biggest donor of humanitarian aid and an unwavering champion of the two-state solution," she added.

But the EU's 27 member states are divided on whether to sanction Israel. Germany has previously been reluctant to do so but the government says it's yet to adopt a formal position on the EU's latest proposal.

"We all agree that the situation in Gaza continues to head in the wrong direction. We must leverage the tools at our disposal to pressure the Israeli government into changing course," said the EU's High Representative for Foreign Affairs, Kaja Kallas.

"The next crucial step is securing support from our Member States to implement this proposal," Kallas added at Wednesday's media briefing.

Unanimous requirement

For these sanctions to pass, the European Council must approve the measure unanimously while the trade component of what the Commission is proposing only requires a qualified majority.

That means that a majority of countries comprising a majority of the EU's population must vote in favor.

Addressing the media Kallas acknowledged that getting sufficient support may be a challenge but added that the Commission will keep working to try and improve the humanitarian situation in Gaza.