Luxembourg's largest supermarket chain, Cactus, had decided to halt the sale of produce until its supplier finds proof that its origin is not the West Bank.
The chain's management caved in to pressure by the pro-Palestinian organization Comité pour une Paix Juste au Proche-Orient, which held noisy demonstrations at the chain's stores, claiming that they sold products from settlements.
The protests continued for months, until managers acquiesced and wrote to the group that it was suspending the sale of Israeli produce.
The chain's management said income from Israeli produce is minimal and is not worth the annoyance to customers caused by protests.
However, the chain announced that it would continue to slel other Israeli products like SodaStream devices and equipment, which provide more significant profits.
Israel's honorary consul in Luxembourg, Daniel Schneider, has begun an attempt to convince management to reserve its decision. Israeli's embassy in Belgium, which also covers Luxembourg, is monitoring the situation.
Around two and a half months ago a ban was revoked on Israeli products at three supermarkets in northern Sweden, which are part of a national chain of 655 stores. Some in Israel feared a domino effect that would lead to the entire chain joining a boycott.
The local chain holds an annual consumer conference consisting of 24 members. Pro-Palestinian organizations submitted a draft resolution to the conference to boycott all Israeli products, and not only ones produced in settlements.
The resolution was passed, but after an aggressive campaign, the Swedish government announced it was strongly opposed to the boycott and that it had not authorized the chain's decision.