By Allyn Fisher-Ilan
JERUSALEM (Reuters) - Israel's plans to free 26 Palestinian prisoners to help underpin renewed peace talks remained on track on Tuesday after its High Court rejected an appeal against their release.
Relatives of Israelis killed by some of the men asked the court to block the release, which could begin as early as Tuesday evening. The three-justice panel ruled the government had been within its purview to free the long-serving inmates.
U.S.-brokered peace talks with the Palestinians, which opened in Washington on July 30, were due to resume on Wednesday in Jerusalem, with further negotiations expected later in the occupied West Bank.
The talks broke down three years ago in a dispute over settlement building in territory Palestinians seek for a state.
Israel's announcement on Sunday of plans to expand settlements have drawn Palestinian anger but no formal threat to withdraw from the negotiations, whose resumption was driven by intensive shuttle diplomacy by U.S. Secretary of State John Kerry.
The United States is seeking to broker a "two-state solution" in which Israel would exist peacefully alongside a Palestinian state created in the West Bank and the Gaza Strip, lands occupied by the Israelis since a 1967 war.
The United States, European Union and United Nations on Monday condemned Israel's announcement of construction plans for about 2,000 new settler homes.
During a visit to Colombia, Kerry called on the Palestinians "not to react adversely" to Israel's latest plans. He said Israel's settlement steps "were to some degree expected" and urged the parties to move ahead with the talks.
"The United States of America views all of the settlements as illegitimate," Kerry said in Bogota.
Similar criticism was voiced by spokesmen for the European Union and U.N. Secretary General Ban Ki-moon.
Israel dismissed such criticism, saying the settlement plans were intended for West Bank areas it intended to keep under any peace deal with the Palestinians.
The 26 prisoners due to be released were among a total of 104 that Israel has agreed to free in four stages.
Palestinian President Mahmoud Abbas, who has vowed to seek freedom for all Palestinian prisoners, gains a boost from the prisoner releases. The subject of prisoners is a highly charged issue in a society where thousands are held in Israeli custody.
Even Abbas's Islamist rival, Hamas, had limited praise for the prisoner release though it also reiterated its objections to negotiating with Israel, whose existence it rejects.
Some 500,000 Israeli settlers live in the West Bank and East Jerusalem amid 2.5 million Palestinians. Israel withdrew in 2005 from the Gaza Strip, now governed by Hamas Islamists.
Few expect the latest negotiations to resolve issues that have defied solution for decades, such as borders, settlements, Jerusalem and Palestinian refugees. The United States has said it seeks a peace deal within nine months.
Netanyahu appears to have decided he can ill-afford to alienate the United States at the moment given the turmoil in the region and led his pro-settlement government into the talks.
Neighboring Egypt and Syria are in upheaval and Israel remains deeply concerned Iran is seeking to build a nuclear bomb, something Tehran denies. Israel is widely believed to be the only power in the Middle East with nuclear weapons.
(Additional reporting by Nidal al-Mughrabi in Gaza, Warren Strobel in Bogota; Editing by Jon Boyle)