Leading lawyers have said that landmark decision in Gerry Abrams Ltd v EAD Solicitors could allow companies targeted by Israel boycotters to take legal action.

In the case this summer, the employment apppeal tribunal ruled that one firm could sue another firm for discrimination under the Equality Act.

Previously, it had been thought that only individuals were able to sue.

The decision has prompted suggestions that companies that lose business because of a boycott could now use the Equality Act to claim they have been discriminated against on grounds of nationality.

Eminent barrister John Bowers QC agrees that the ruling could open a new avenue for firms. "There is scope for this if a company could show discrimination on grounds of its nationality," he said.

But Jonathan Turner, chair of UK Lawyers for Israel, believes that because of the limitations of the Act, it would still be difficult for suppliers of goods or services to sue.