The European Union is poised to mandate that Israeli products made in contested territories carry consumer warning labels, a decision that could trigger American anti-boycott laws and open up what legal experts describe as a "Pandora's box" of litigation, according to multiple sources involved in the legal dispute who spoke to the Washington Free Beacon.

The Advocate General of the European Court of Justice recently issued non-binding opinion arguing that EU law requires Israeli-made products to be labeled as coming from "settlements" and "Israeli colonies."

The decision was seen as a major win for supporters of the anti-Semitic Boycott, Divestment, and Sanctions movement, or BDS, which seeks to wage economic warfare on Israel and its citizens. Pro-Israel activists, as well as the Jewish businesses involved in the legal dispute, see the decision as an ominous warning sign that they say is reminiscent of Holocaust-era boycotts of Jewish businesses.

With the EU court's 15 judge panel now poised to issue its own binding judgment in the case, legal experts are warning that a potential decision mandating such labeling could pave the way for goods from any disputed territory to receive such treatment. The decision also could trigger U.S. anti-boycott laws meant to stop Israeli-made goods from being singled out for unfair treatment on the international market.

Brooke Goldstein, a human rights lawyer and executive director of the Lawfare Project, which is involved in the legal dispute, described the EU court's initial decision as "frankly outrageous."

"The Advocate General's opinion said that goods produced by Muslims are to be labeled from ‘Palestine,' and goods produced by Jews labeled as coming from ‘Israeli colonies,' Goldstein said. "Both people are living in the same geographic location, and yet Jewish goods are being treated differently."

"Could the discrimination be any clearer?" she asked. "If the EU Court justifies this bigotry it will degrade the rule of law in Europe and it will undoubtedly have many unintended consequences for EU traders. My understanding is that certain consumer protection agencies have already filed complaints to demand the similar labeling of goods from other disputed territories. This labeling fiasco will turn into a nightmare for EU importers of goods from any and all countries involved in territorial disputes. I trust the court will maintain that goods must be labeled indicating the geographical location of origin, and reject the push to politicize labeling."

The legal dispute first began after France passed a law mandating that products made in the West Bank territory of Israel be labeled as coming from an "Israeli colony," a label not applied to any other products across the globe.

The term "Israeli colony" is not legally required to be applied under EU law and was seen as overly burdensome by Israeli business leaders.

Following the French decision, the Israeli Psagot winery filed a lawsuit alleging unlawful discrimination against Jewish companies. That lawsuit eventually made its way to Europe's highest court, the European Court of Justice.

That court now appears poised to affirm the advocate general's opinion mandating that Israeli goods be labeled in a fashion that opponents say is unfair and anti-Semitic in nature.

"I am not a psychologist, so I can't tell you what the motives are behind Europe's targeting of Jewish-owned businesses. Perhaps it is anti-Semitism rearing its ugly head again, perhaps it is blind ignorance, or even a desire to do the right thing," Yaakov Berg, CEO of the Psagot winery, told the Free Beacon. "Regardless, the application of the current EU trade directive to label goods from Jewish producers, and only Jewish producers in the West Bank is discriminatory and illegal."

Berg maintains that Jewish businesses should not be penalized for policies enacted by the Israeli government that European leaders object to.

"We are not the Israeli government," he said. "Psagot winery is not responsible for Israeli government policy. But because we are Jewish owners of a winery in a beautiful and hotly contested land, we are being targeted and punished. And we are being punished precisely because we are Jews living in Judea where we have every right to be, as do the Palestinian Arabs and Druze and the Christians."

"No one should be discriminated against because of their religion," Berg said. "If you support a Palestinian state, would you support a Judenrein state of Palestine? That seems to be what the EU is proposing when it says Jewish businesses are illegal in Palestine but Muslim businesses are not, in the same location! Such a de facto boycott of Jewish products, the likes of which we have not seen since Nazi Germany, would definitely run afoul of U.S. law."

Yohan Benizri, a lawyer representing Psagot, warned that a decision affirming the labels for Jewish-made goods could open the door to other types of overly onerous labeling.

"One doesn't need legal training to recognize the unintended consequences of the EU adopting a policy of politicized labeling," Benizri said. "If the EU Court rules that geographic location is not enough, and that EU law mandates every product coming from either a ‘disputed territory' or a country with ‘objectionable social policies' be labeled as such, then EU markets will be thrown into chaos."

"Can you imagine a situation where plastic cups imported from China must be labeled ‘this country has a one-child policy,' or gas from Russia must be labeled, ‘This is gas from a country that illegally occupies Crimea,' or products from the United States require the labeling ‘the U.S. engages in capital punishment and is building an illegal border wall?' Product labels will have become political billboards depending on the whims of EU politicians, and every EU importer will shoulder a liability for not complying with arbitrary labeling laws."

A State Department spokesman told the Free Beacon that the Trump administration has been clear in its objection to the BDS movement and efforts to single out the Jewish state.

"The State Department is aware of this particular issue," the official said. "The administration's position strongly opposing all efforts to boycott, delegitimize, or isolate Israel is well-known."