* France hopes to hold peace conference before year-end
* Last Israel-Palestinian negotiations collapsed in 2014
* Israel says wants direct talks with Palestinians

Israel on Monday formally rejected France's invitation to take part in a Middle East peace conference in Paris later this year, saying it was a distraction from the goal of direct negotiations with the Palestinians.

At a meeting in Jerusalem with Israel's acting national security adviser and Prime Minister Benjamin Netanyahu's diplomatic adviser, French envoy Pierre Vimont was informed that Israel wanted nothing to do with the effort to revive talks that last broke down in 2014.

‘(They) told the French envoy in a clear and unequivocal manner that Israel's position to promote the peace process and reach an agreement will only come through direct negotiations between Israel and the Palestinian Authority,’ Netanyahu's office said in a statement.

There was no immediate comment from Vimont but the French foreign ministry said it still planned to hold the conference before the end of the year.

France has repeatedly tried to breathe new life into the peace process this year, holding a preliminary conference in June where the United Nations, European Union, United States and major Arab countries gathered to discuss proposals without the Israelis or Palestinians present.

The plan was to hold a follow-up conference before year-end with the Israelis and Palestinians involved and see whether the two sides could be brought back to negotiations. The last, US-backed talks ended in failure in April 2014.

The Palestinians have said they will attend the Paris conference if it goes ahead.

Israel, which regards the United States as the chief broker in the Middle East, has long maintained that only direct negotiations with the Palestinians can lead to peace and sees France's efforts as a diversion.

‘Any other initiative, including this one, will only distance peace from the region,’ Netanyahu's office said, adding that it expected France ‘not to promote a conference or a process that is contrary to (our) official position.’

Israel says an international conference will also give Palestinian President Mahmoud Abbas a platform on which to grandstand, rather than engaging directly with the Israelis.

The Palestinians say they cannot resume talks with Israel until it suspends the building of settlements on occupied land the Palestinians seek for an independent state and meets previous commitments, including the release of prisoners.

Despite two US attempts to resolve the conflict during Barack Obama's presidency, talks have stalled over issues including settlements and Palestinian political divisions.

While most of the so-called ‘final status’ issues are clear to both sides, critics say there will be little chance of a breakthrough without genuine US pressure on Israel to halt settlement building and without the Palestinians overcoming the internal splits between Hamas and the Fatah party.

Many analysts believe the prospect of a two-state solution to the conflict is now beyond reach, with no signs of Israel ending its nearly 50-year occupation of the West Bank and East Jerusalem, which the Palestinians want for their own capital.