Spain and Italy's governments have warned their citizens against doing business with Israeli settlers in the occupied Palestinian territories of the West Bank, East Jerusalem and in the Golan Heights.

Following the advice of French foreign ministry, which issued a similar notice to their nationals, Madrid and Rome said that any business conducted in the settlements entails legal risks as they are built upon land occupied by Israel in the 1967 Six-Day War.

The European Union and its members do not recognise Israeli rule there, which is illegal under international law.

"The current situation could lead to disputes over land, water, quarries or natural resources that were acquired or in which money was invested," read the statement from the Spanish Foreign Ministry. "Companies must take into account that [financial activity in the settlements] is liable to lead to their involvement in breaking international law and violating human rights."

Spain officially opposes sanctioning or boycotting Israel, foreign ministry officials explained. The warning was an implementation of a decision by the European Union and alignment with actions taken by other European countries. The UK and Germany issued similar warnings several months ago.

Italy's foreign minister Federico Mogherini also cautioned Italians "not to get involved in financial activity and investments" in settlement. The warning was given "in accord with other European countries" said Mogherini, in a bid to implement a political decision taken earlier.

Earlier, France's foreign ministry said that financial activity in the settlements "such as money transfers, investments, acquisition of property, provision of supplies or the performance of any other economic activities that benefit the settlements involves risks".

The statement continued to warn of the risks posed by settlement investment because of the international community's refusal to recognise them as part of Israel.

"This could lead to a high likelihood of land disputes or disagreements regarding water, quarries or other natural resources," the French statement added.

"This involves risk to the image of those who carry out such economic activity... We call upon citizens or businesspeople who are considering becoming involved in economic activity in the settlements to seek appropriate legal advice before going ahead."

An Israeli diplomat told Haaretz that the warnings were unwelcome at a time when three Israeli teenagers remain missing after being kidnapped in the occupied West Bank.

Dani Dayan, the chairman of the YESHA (Hebrew acronym for Yehuda Shomron, Aza) Council of Jewish Communities in Judea and Samaria tweeted that French citizens "keep joining" the West Bank's Jewish communities and that their "investment won't stop".

The warning from Italian, French and Spanish governments comes as a victory for the Boycott, Divestment and Sanctions (BDS) movement as the decision, though not legally-binding, is likely to lead to an increased boycott of the countries' financial activity within the settlements.