Europe should be careful, lest this take a disproportionate response. Israel is building homes in established settlements. Nothing more, nothing less. In the past, construction of this sort was not a barrier to peace. After signing a peace treaty with Egypt, Israel agreed to remove all settlements in the Sinai. This would be no different. The Palestinian unilateral action in the UN, on the other hand, cannot be reversed. The fact that they (and the Europeans) breach the legal requirements of Oslo cannot be reversed. If anything, Israel's response to their offence is disproportionally too tame.
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Turkish journalists convicted of revealing state secrets, sentenced to 5 years (Reuters)