PALESTINIANS’ rights activists suffered a legal setback today when the Court of Appeal overturned a ruling that local councils’ ethical boycott of Israeli goods was legal.

The Palestine Solidarity Campaign (PSC), which brought the case, said it was “incredibly disappointed” by the decision, but it would consider escalating the case to the Supreme Court.

Last June, the High Court upheld the PSC argument that local government pension scheme guidelines, which said local authorities “should not pursue policies that are contrary to UK foreign policy or UK defence policy,” were unlawful in preventing the use of boycotts, divestment and sanctions (BDS).