The Ministry of Justice has published a draft bill aimed at resolving the issue of universal jurisdiction.
A change in the law would make it more difficult for Israeli politicians to be arrested in Britain for alleged war crimes.
It remains unlikely, however, that there will be time to complete the process before the end of the parliamentary term.
The proposal suggests restricting the right to prosecute to the Crown Prosecution Service as being the "most straightforward solution".
Action would only be taken when an offence is alleged to have been committed outside the UK by a non-British national.
This would block groups challenging British armed forces personnel who served in Afghanistan or Iraq.
A Ministry of Justice statement issued on Wednesday said the government was "worried" by the current situation and how it "might affect relations with other states".
It said expert prosecutors and independent investigators would need to be confident of a successful prosecution to proceed.
The bill is open to consultation from interested parties until April 6.