The London Israeli cosmetics shop Ahava has been accused of "war crimes" during a trial of four demonstrators.

The four "stormed" Ahava in Covent Garden twice last year: Matthew Richardson, 24, and Gwendolen Wilkinson, 20, on October 2, and Christopher Osmond, 30, and Jessica Nero, 33, on November 22.

Both times the store was forced to close after protesters lay on the floor and chained themselves to each other and a concrete bollard, refusing to move for hours until cut free by police.

During a three-day trial this week at Stratford Magistrates' Court, the four denied various charges of aggravated trespass. They were supported in court by Palestine Solidarity activists and argued that the purpose of the protest was to stop the store from selling illegal goods.

They claimed that the products sold in the shop were manufactured in an Israeli settlement, Mitzpe Shalom in the West Bank, but were "misleadingly" labelled as produced in Israel.

We are just being punished for being an Israeli company

Mr Jonas Milner, prosecuting, argued that despite a Camden Council Trading Standards investigation: "No conviction has been recorded against Ahava.

"We have heard evidence that some of the activities and goods that Ahava are selling are under investigation and may be unlawful.

"Equally, there are lawful goods and services provided. All of that was disrupted."

The court heard from Odelia Haroush, the manager of the store, who was called by staff when the protesters chained themselves together.

She said on a normal Saturday, the store took around £600, but on the day of the October incident, it made £142.

"People do not want to take treatments while police are in the store and demonstrators are lying on the floor," she said. "They don't let us do our work. We have done nothing wrong. We are just being punished for being an Israeli company. As far as I know, the Dead Sea is part of Israel. The factory is on the shores of the Dead Sea. I don't know if Mitzpe Shalom is a settlement."

The court heard from shop assistant Matilda White, whose first day at work was disrupted when the protesters entered the shop in November. She thought they were pulling out a bomb when she saw a concrete pillar taken out of a rucksack.

Mr Richardson, unemployed, said the entire operation of the Ahava shop was "tainted. All the products in the shop originate in this illegal settlement and have been deliberately mislabelled. The law is being deliberately flouted. There has been a great deal of reluctance from the enforcement authorities to get involved. They have put political considerations above maintaining the rule of law. I felt I had to act."

Mr Milner accused him of taking the law into his own hands and of "vigilantism".

Jude Bunting, defending Mr Richardson and Ms Wilkinson, said that Ahava was unlawfully trading and so his clients could not be charged with trespassing on land with the intention of disrupting its lawful activity.

He also accused Ahava of fraudulently using the EU-Israel Association Agreement by receiving preferential trade tariffs on goods which were mislabelled from Israel, and breaching the Fourth Geneva Convention by encouraging Israeli civilians to settle in an "illegal" settlement.

He claimed that Ahava was "aiding and abetting war crimes" by economically supporting the factory in Mitzpe Shalom and encouraging Israelis to move to an illegal settlement.

Mr Osmond, a Palestine researcher at campaign group Corporate Watch, and Ms Nero, who works in a bookshop, were charged with not obeying a police order after they were asked to leave.

Last year Mr Osmond was acquitted, along with six others, of causing £200,000 worth of damage to the EDO MBM factory in Brighton which they believed made arms for Israel.

James Mehigan, defending Mr Osmond and Ms Nero, said that the officer who read a warning to the protesters did not conduct a "satisfactory" investigation to find out if Ahava were trading lawfully.

But Mr Milner said: "I don't address you on war crimes or settlements. You have not heard evidence from anyone who can attest to Ahava activities and whether that amounts to a war crime."

Mr Mehigan and Mr Bunting were instructed by the law firm Irvine Thanvi Natas, whose partner Simon Natas is involved with Lawyers for Palestinian Human Rights.

In 2009 Mr Mehigan, who works at chambers run by the Israel critic, Michael Mansfield QC, drew up an arrest warrant for Israeli defence minister Ehud Barak.

District Judge Ian Baker said that he would reserve his judgment.