Two alleged Israeli secret agents were given six-month prison terms in this country Thursday for illegally trying to obtain a New Zealand passport.
Prime Minister Helen Clark (search) later said the case "seriously strained relations" between Israel and New Zealand, and canceled planned foreign ministry talks later this year.
"The New Zealand government views the act carried out by the Israeli intelligence agents as not only utterly unacceptable but also a breach of New Zealand sovereignty and international law," she said.
Urie Zoshe Kelman, 30, and Eli Cara, 50, both admitted to the passport charges at an earlier hearing. They'd faced a maximum sentence of five years.
The two, reportedly linked to Israel's Mossad (search) foreign intelligence service, were arrested in March after they tried to collect a passport in the name of a New Zealand citizen who is a wheelchair-bound cerebral palsy victim.
There was no reaction from the pair following their sentencing in the Auckland High Court.
Israel's acting ambassador in Australia, Orma Sagiv, said Israel would be working to rebuild relations with New Zealand.
"Israel values its relations with New Zealand very much and we will do everything we can to return relations to their former situation," she said from Canberra.
Thursday's sentencing came after the two defendants made a surprise plea change to guilty at their last court appearance on July 2.
Two other men thought to be involved in the crime remain at large, police said.
One has been named as Ze'ev William Barkin, 36, but police said the pair in custody had refused to divulge the fourth man's identity. He is believed to be at large in New Zealand.
Clark said that Israel had ignored requests made three months ago for an explanation and an apology.
As a result, Clark said she would suspend high-level visits by New Zealand government officials to Israel and refuse any request for Israel's President Moshe Katsav (search) to visit later this year when he is due to go to Australia.
Any Israelis visiting New Zealand on government business would have to apply for a visa. Approval for the appointment of a new Israeli ambassador to New Zealand will also be delayed.
"As will be apparent from these steps, the breach of New Zealand laws and sovereignty by agents of the Israeli government has seriously strained our relationship with Israel," Clark said in a statement following the sentencing.