WASHINGTON — The Obama administration said Monday it was reviewing its annual $440 million aid package to the Palestinians because of their effort to join the International Criminal Court to pursue war-crimes charges against Israel.

At the same time, however, the US criticized Israel for withholding tens of millions in tax revenues to the Palestinians, saying such a step “raises tensions.” Taken together, the statements reflected Washington trying to come to grips with a Palestinian move it has spent years trying to avert and a peace process that offers no hope for an immediate breakthrough.

The Palestinian decision to join The Hague court came after the UN Security Council last month rejected setting a three-year deadline for an Israeli withdrawal from Palestinian-claimed lands. Israel fears Palestinian membership there could lead to a rash of politically motivated prosecutions that further isolates the Jewish state and makes it hard for Israeli officials to travel abroad.

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“We’re deeply troubled by the Palestinian action,” State Department spokeswoman Jen Psaki told reporters. She said joining the court “is entirely counterproductive and does nothing to further the aspirations of the Palestinian people for a sovereign and independent state. It badly damages the atmosphere with the very people with whom they ultimately need to make peace.”

Under American law, any Palestinian case against Israel at the court would trigger an immediate cutoff of US financial support. Membership itself doesn’t automatically incur US punishment.

Secretary of State John Kerry discussed the matter by telephone over the weekend with Israeli Prime Minister Benjamin Netanyahu. Other US officials spoke with Palestinian President Mahmoud Abbas, hoping to dissuade him from his course.

Abbas has been under heavy pressure to take stronger action against Israel amid months of rising tensions. US-brokered peace talks collapsed last spring and a 50-day war followed between Israel and Palestinian terrorists in Gaza over the summer.

Netanyahu said earlier this month that Palestinian leaders were the ones who should be prosecuted in the ICC over their unification with rival faction Hamas.

“It is the Palestinian Authority leaders – who have allied with the war criminals of Hamas – who must be called to account,” he said. “IDF soldiers will continue to protect the State of Israel with determination and strength, and just as they are protecting us we will protect them, with the same determination and strength.” Abbas’s Fatah and Hamas are backers of the current Palestinian unity government. Hamas, the terror group that controls Gaza, calls for the destruction of Israel.

Israeli legal group Shurat HaDin, the Israel Law Center, filed lawsuits on Monday at the ICC against three Palestinian Authority leaders for alleged war crimes, terrorism and human rights offenses. Indictments were brought against PA Prime Minister Rami Hamdallah, Abbas’s deputy; minister Jibril Rajoub; and PA intelligence chief Majed Faraj, all of whom belong to Abbas’s Fatah party.

The administration is reviewing its assistance to the Palestinians to ensure it complies with U.S. law, Psaki said. She said there is a range of ways for the US to respond, but suggested none would happen immediately.

“The focus right now is to continue to encourage both sides,” Psaki said. She cited Israel, too, for escalating tensions by freezing the transfer of tax revenues to the Palestinians.

“What we’re trying to avoid here is a back-and-forth tit-for-tat,” Psaki said.

Israel, like the US, is not a member of the international court and doesn’t recognize its jurisdiction. The court has no police force and no authority to go into Israel and arrest suspects. But it could issue arrest warrants that European and other countries would be willing to enforce. The US accepts Israel’s position that Palestinian membership in the court is an impediment to peace.