The Government of the State of Israel and the Palestine Liberation Organization (hereafter "the P.L.O."), the representative of the Palestinian people;

WITHIN the framework of the Middle East peace process initiated at Madrid in October 1991;

AIMING at the achievement of a just, lasting and comprehensive peace in the Middle East based on the implementation of UN Security Council Resolutions 242 and 338 in all their aspects;

REAFFIRMING their adherence to the commitments expressed in the Declaration of Principles (hereinafter "the DOP") signed in Washington D.C. on September 13th 1993, the Cairo Agreement of May 4th 1994, and the Interim-Agreement of September 28th, 1995;

REAFFIRMING their determination to live in peaceful coexistence, mutual dignity and security;

DECLARING as null and void any agreement, declaration, document or statement which contradicts this Framework Agreement;

DESIROUS of reaching a full agreement on all outstanding final status issues as soon as possible, not later than May 5th 1999, as stipulated in the DOP;

HEREBY AGREE on the following Framework for a Final Status Agreement;

1. As an integral part of this Framework Agreement and the full Final Status Agreement:

a. The Government of Israel shall extend its recognition to the independent State of Palestine within agreed and secure borders with its capital al-Quds upon its coming into being not later than May 5th 1999.

b. Simultaneously, the State of Palestine shall extend its recognition to the State ofIsrael within agreed and secure borders with its capital Yerushalayim.

c. Both sides continue to look favorably at the possibility of establishing a Jordanian-Palestinian confederation, to be agreed upon by the State of Palestine and the Hashemite Kingdom of Jordan.

2. The State of Israel and the State of Palestine (hereinafter: "the parties") will thereby extend mutual recognition of their right to live in peace and security within mutually agreed borders as defined in Article II of this agreement and in the Final Status Agreement. In particular, the Parties shall:

a. Recognize and respect each other's sovereignty, territorial integrity and political andeconomic independence.

b. Renounce the use of force, and the threat of force as an instrument of policy and commit themselves to a peaceful resolution of all disputes between them.

c. Refrain from organizing, instigating, inciting, assisting or participating in acts of violence, subversion or terrorism against the other party.

d. Take effective measures to ensure that acts of or threats of violence do not originate from or through their respective territories, including their airspace and territorial waters, and take appropriate measures against those who perpetrate such acts.

e. Undertake not to join, assist, or cooperate with any military or security coalition, organization, or alliance hostile to either party.

f. Exchange and ratify the instruments of peace between them as shall be defined in the full Final Status Agreement.

1. The secure and recognized borders between the State of Israel and the future State of Palestine are described in the attached Maps and in Annex One of the Final Status Agreement. The Parties recognize that these borders, including their respective subsoil, airspace and territorial waters shall be inviolable.

2. The parties shall define the route and mode of implementation of, as well as the extent of, territory to be yielded by Israel for the agreed extra-territorial passage between the Gaza Strip and the West Bank (as described in Annex One of the Final Status Agreement).

3. The border in the Jerusalem area is to be delineated in accordance with the provisions of Article VI of this Framework Agreement.

4. The Parties shall recognize the final borders between the two states as permanent and irrevocable.

1. Upon the exchange of the instruments of ratification of the peace treaty, the Parties agree to establish full diplomatic and consular relations between them and to promote economic and cultural relations including the free movement of people, goods, capital and services across their borders.

2. The Parties shall continue to cooperate in all areas of mutual interest and will seek to promote jointly and separately similar regional cooperation with other states in the area and the international community.

3. The Parties shall seek to promote mutual cultural relations and will encourage mutual programs for the dissemination of their respective national customs, folklore and traditions between them.

4. The Parties shall secure freedom of access to places of religious, and historical significance on a non-discriminatory basis. Access to, worship in, and protection of all holy places and sites shall be guaranteed by both Parties.

1. In implementing UN Security Council Resolutions 242 and 338, the parties agree that the withdrawal of Israeli Military and Security Forces shall be carried out in three stages:

a. Withdrawal from the Central areas of the West Bank and the entire Gaza Strip, (as defined in Annex Two to the Final Status Agreement and attached Map/s), to commence not later than May 5th 1999 and be completed not later than September 4th, 1999;

b. Withdrawal from the Eastern areas of the West Bank (as defined in Annex Two to the Final Status Agreement), to commence not later than September 5th 1999 and be completed not later than January 4th, 2000;

c. Withdrawal from the Western areas of the West Bank (as defined in Annex Two to the Final Status Agreement) to commence not later than January 5th 2000 and be completed not later than May 4th 2000.

2. Thereafter Israel shall maintain a minimal residual force within agreed military compounds and in specified locations. This residual force will comprise:

a. Three reinforced battalions, two existing Military Emergency Stores, and integral logistical forces (their location and terms of lease, duration, mode of deployment, function and numerical strength, are detailed in Annex Two to the Final Status Agreement).

b. Three Early Warning stations and three Air Defense Units as defined and agreed in Annex Two to the Final Status Agreement will be maintained until May 5th 2007 or until peace agreements and bilateral security arrangements between Israel and the relevant Arab parties are attained, whichever comes last.

3. The Parties agree to the formation of an Israeli-Palestinian Coordinating Security Commission (hereinafter "the CSC") to oversee the implementation of Israel's military withdrawal, to establish the modalities governing its residual military presence, and to coordinate all other security matters (its structure and authorities are detailed in Annex Two to the Final Status Agreement). The CSC shall also implement an agreed schedule for the introduction of Palestinian Security Forces (hereinafter "PSF") into Palestinian territories commensurate with and parallel to the withdrawal of Israeli forces. The Parties agree that the CSC shall commence its deliberations not later than May 5th, 1998 (see Annex Two to the Final Status Agreement).

4. Joint Israeli-Palestinian patrols will be held along the Jordan River as well as along both sides of the Israeli-Palestinian border, in order to deter, prevent and combat the infiltration or organization of cross-border terrorism and other forms of violent activities. The mandate and duration of these patrols shall be determined by the CSC, as detailed in Annex Two to the Final Status Agreement.

5. The Parties agree that the State of Palestine shall be demilitarized. The PSF shall remain subject to agreed limitations as defined in Annex Two to the Final Status Agreement. By mutual agreement, and not before May 5th 2007, Palestinian self-defense capabilities shall be negotiated by the Parties.

6. The Parties agree that the co-sponsors and other parties agreed upon, shall be invited to guarantee the arrangements for Israel's military withdrawal and other bilateral security agreements as stipulated in this Framework Agreement. In their capacity as guarantors, the said third-parties shall also be invited to participate in observation, verification and other technical duties to be agreed in the CSC. The said third parties shall accordingly be requested to establish and finance a permanent International Observer Force (hereafter the IOF) whose mandate and functions are described in Annex Two of the Final Status Agreement.

1. Subsequent to the establishment of the Independent State of Palestine and its recognition by the State of Israel as described in Articles I and III of this agreement:

a. There will be no exclusive civilian residential areas for Israelis in the State of Palestine.

b. Individual Israelis remaining within the borders of the Palestinian State shall be subject to Palestinian sovereignty and Palestinian rule of law.

c. Individual Israelis who have their permanent domicile within the Palestinian State as of May 5th 1999, shall be offered Palestinian citizenship or choose to remain as alien residents, all without prejudice to their Israeli citizenship.

d. Within the agreed schedule for the withdrawal of Israeli forces from Palestinian territories as described in Article IV and Annex Two to the Final Status Agreement, the Israeli Government and its security forces shall maintain responsibility for the safety and security of Israeli settlements outside the areas of Palestinian security jurisdiction, pending the transfer of said areas to full Palestinian rule.

e. The CSC shall establish the mechanism for dealing with security issues relating to Israeli citizens in Palestine and Palestinian citizens in Israel.

1. Jerusalem shall remain an open and undivided city with free and unimpeded access for people of all faiths and nationalities.

2. The Parties further agree that a reform of the current Jerusalem Municipal System and its boundaries shall be introduced not later than May 5th 1999, and shall not be subject to further change by law or otherwise, unless by mutual consent, prior to the fulfillment of the provisions of paragraph 9 below. This reform shall expand the present municipal boundaries of Jerusalem and shall define the city limits of the "City of Jerusalem", to include: Abu Dis, Eyzariya, ar-Ram, Az-zaim, Ma'ale Adumim, Givat Ze'ev, Givon, and adjacent areas in the attached map/s.

3. Within the "City of Jerusalem", neighborhoods inhabited by Palestinians will be defined as "Palestinian boroughs" The exact borders of the "City of Jerusalem" and of the Israeli and Palestinian boroughs are delineated and described in Annex Three to the Final Status Agreement and attached Map/s. The number of Israeli boroughs and of Palestinian boroughs will reflect the present demographic balance of 2:1. This proportion will be updated in accordance with the modalities, criteria and schedule as described in Annex Three to this Final Status Agreement.

4. The Parties agree to maintain one Municipality for the "City of Jerusalem" in the form of a Joint Higher Municipal Council, formed by representatives of the boroughs. These representatives will elect the Mayor of the "City of Jerusalem" In all matters related to the areas of the "City of Jerusalem" under Palestinian sovereignty, the Joint Higher Municipal Council shall seek the consent of the Government of Palestine. In all matters related to the areas of the "City of Jerusalem" under Israeli sovereignty, the Joint Higher Municipal Council shall seek the consent of the Government of Israel.

5. The "City of Jerusalem" shall consist of the Joint Higher Municipal Council, two sub-municipalities - an Israeli sub-municipality, elected by the inhabitants of the Israeli boroughs, and a Palestinian sub-municipality, elected by the inhabitants of the Palestinian boroughs - as well as a Joint Parity Committee for the Old City Area as described in paragraph 12 below.

6. The Parties further agree that the municipality of the "City of Jerusalem" shall:

a. Delegate strong local powers to the sub-municipalities including the right to local taxation, local services, an independent education system, separate religious authorities, and housing planning and zoning, as detailed in Annex Three to the Final Status Agreement;

b. Develop a twenty-five year Master Plan for the "City of Jerusalem" with agreed modalities for its balanced implementation, including safeguards for the interests of both communities.

c. Provide for Israeli and Palestinian citizens resident within the jurisdiction of the City of Jerusalem Municipality and sub-municipalities to vote and seek election for all elected posts as shall be specified in the Jerusalem Municipal bylaws.

7. Within the "City of Jerusalem" both parties recognize the Western part of the city, to be "Yerushalayim" and the Arab Eastern part of the city, under Palestinian sovereignty, to be "al-Quds" (see attached Map/s).

8. Upon the exchange of the instruments of ratification of the peace treaty between them:

a. The Government of the State of Palestine shall recognize Yerushalayim, as defined under Article VI, paragraph 7 and Annex Three to the Final Status Agreement, as the sovereign Capital of the State of Israel.

b. The Government of the State of Israel shall recognize al-Quds, as defined under Article VI, paragraph 7 and Annex Three to the Final Status Agreement, as the sovereign Capital of the State of Palestine.

9. The ultimate sovereignty of the area outside Yerushalayim and al-Quds, but inside the present municipal boundaries of Jerusalem, shall be determined by the parties as soon as possible. Each party maintains its position regarding the sovereign status of this area. A joint Israeli-Palestinian committee for determining the final status of this area shall be established not later than May 5th, 1999 and shall commence its deliberations immediately thereafter. Without prejudice to the determination of the final status of this area:

a. Palestinian citizenship shall be extended to Palestinian residence of this area.

b. In certain matters Palestinian citizens residing in this area shall resort to Palestinian law (as detailed in Annex Three to the Final Status Agreement).

c. The Parties will enjoy free access to and use of the Qalandia Airport in this area. A new designated Palestinian terminal shall be constructed, to commence operation concurrent with the signing of the Treaty of Peace (for the modalities of operation, see Annex Three to the Final Status Agreement).

10. The Parties acknowledge Jerusalem's unique spiritual and religious role for all three great monotheistic religions. Wishing to promote interfaith relations and harmony among the three great religions, the Parties accordingly agree to guarantee freedom of worship and access to all Holy Sites for members of all faiths and religions without impediment or restriction.

11. In recognition of the special status and significance of the Old City Area (see map/s) for members of the Christian, Jewish, and Muslim faiths, the parties agree to grant this area a special status.

12. The Parties further agree that:

a. The Palestinian sub-municipality shall be responsible for the municipal concerns of the Palestinian citizens residing in the Old City Area and their local property.

b. The Israeli sub-municipalies shall be responsible for the municipal concerns of the Israeli citizens residing in the Old City Area and their local property.

c. The two sub-municipalities shall appoint a Joint Party Committee to manage all mattersrelated to the preservation of the unique character of the Old City Area (its structureand modalities are detailed in Annex Three to the Final Status Agreement).

d. In case of a dispute between the two sub-municipalities on matters related to the Old City Area, the issue shall be referred for a decision to the Joint Parity Committee.

13. The State of Palestine shall be granted extra-territorial sovereignty over the Haram ash-Sharif under the administration of the al-Quds Awqaf. The present status quo regarding the right of access and prayer for all, will be secured.

14. The Church of the Holy Sepulchre shall be managed by the Palestinian sub-Municipality. The Joint Parity Committee, shall examine the possibility of assigning extra-territorial status to the Church of the Holy Sepulchre.

15. Supervision of persons and goods transiting through the "City of Jerusalem" shall take place at the exit points. Other security matters related to persons, vehicles and goods suspected of involvement in hostile activity are dealt with in Annex Two to the Final Status Agreement.

1. Whereas the Palestinian side considers that the right of the Palestinian refugees to return to their homes is enshrined in international law and natural justice, it recognizes that the prerequisites of the new era of peace and coexistence, as well as the realities that have been created on the ground since 1948, have rendered the implementation of this right impracticable. The Palestinian side, thus, declares its readiness to accept and implement policies and measures that will ensure, insofar as this is possible, the welfare and well-being of these refugees.

2. Whereas the Israeli side acknowledges the moral and material suffering caused to the Palestinian people as a result of the war of 1947-1949. It further acknowledges the Palestinian refugees' right of return to the Palestinian state and their right to compensation and rehabilitation for moral and material losses.

3. The parties agree on the establishment of an International Commisssion for Palestinian Refugees (hereinafter "the ICPR") for the final settlement of all aspects of the refugee issue as follows:

a. The Parties extend invitations to donor countries to join them in the formation of the ICPR.

b. The Parties welcome the intention of the Government of Sweden to lead the ICPR and to contribute financially to its activities.

c. The Government of Israel shall establish a fund for its contribution, along with others, to the activities of the ICPR.

d. The ICPR shall conduct all fundraising activities and coordinate donors' involvement in the program.

e. The ICPR shall define the criteria for compensation accounting for:

(1) moral loss;

(2) immovable property;

(3) financial and economic support enabling resettlement and rehabilitation of Palestinians residing in refugee camps.

f. The ICPR shall further:

(1) adjudicate claims for material loss;

(2) prepare and develop rehabilitation and absorption programs;

(3) establish the mechanisms and venues for disbursing payments and compensation;

(4) oversee rehabilitation programs;

(5) explore the intentions of Palestinian refugees on the one hand and of Arab and other countries on the other, concerning wishes for emigration and the possibilities thereof;

(6) explore with Arab governments hosting refugee populations, as well as with these refugees, venues for absorption in these countries whenever mutually desired.

g. The ICPR shall implement all the above according to the agreed schedule defined in Annex Four to the Final Status Agreement.

4. The ICPR shall be guided by the following principles in dealing with the "refugees of 1948" and their descendants as defined in Annex Four to the Final Status Agreement:

a. Each refugee family shall be entitled to compensation for moral loss to a sum of money to be agreed upon by the ICPR.

b. Each claimant with proven immovable property shall be compensated as per the adjudication of the ICPR.

c. The ICPR shall provide financial and economic support, enabling the resettlement and rehabilitation of Palestinians residing in refugee camps.

d. The refugees shall be entitled to financial and economic support from the ICPR for resettlement and rehabilitation.

5. The State of Israel undertakes to participate actively in implementing the program for the resolution of the refugee problem. Israel will continue to enable family reunification and will absorb Palestinian refugees in special defined cases, to be agreed upon with the ICPR.

6. The Palestinian side undertakes to participate actively in implementing the program for the resolution of the refugee problem. The Palestinian side shall enact a program to encourage the rehabilitation and resettlement of Palestinian refugees presently resident in the West Bank and Gaza Strip, within these areas.

7. The PLO considers the implementation of the above a full and final settlement of the refugee issue in all its dimensions. It further undertakes that no additional claims or demands arising from this issue will be made upon the full implementation of this Framework Agreement.

1. The Parties shall establish an Israeli-Palestinian Standing Committee (hereafter: "IPSC"), which will commence activities upon the signing of this Framework Agreement.

2. This IPSC shall be authorized to deal with all matters related to the smooth transition between the Interim Agreement and Final Status Agreement.

3. The IPSC shall also coordinate activities related to the implementation of the Final Status Agreement.

1. The Parties agree that they possess the same natural water resources essential for each nations livelihood and survival.

2. Water rights and issues are laid out in Annex Five to the Final Status Agreement.

3. With a view to achieving a comprehensive and lasting settlement of all water problems between them, the Parties jointly undertake to ensure that the management and development of their water resources should not in any way harm or imperil the water resources of the other.

4. The Parties further agree to the following:

a. The development of existing and new water resources to increase availability and minimize wastage.

b. The prevention of contamination of water resources.

c. The transfer of information and joint research and the review of the potential for water enhancement.

5. The Parties agree to prepare as soon as possible, but not later than May 5, 1999, an agreed upon coordinated separate and joint water management plan for the joint aquifers that will guarantee optimal use and development of water resources for the benefit of the Israeli and Palestinian nations.

6. The Parties agree to seek to extend their joint co-operation to the Hashemite Kingdom of Jordan, in particular with regard to the waters of the Jordan River and the Dead Sea and to seek to promote wider regional understanding on the exploitation and management of water resources in the Middle East.

A. The Preparatory Period: May 5th 1996 to May 4th 1999

1. With the signing of this Framework Agreement and its entry into force not later than May 5th 1996, the Preparatory Period for Final Status shall commence. Immediately thereafter, the Parties shall:

a. Establish the IPSC (Israeli-Palestinian Standing Committee) along the lines laid down in Article VIII.

b. Extend invitations to donor countries to join the Government of Sweden and themselves in formation of the ICPR (International Commission for Palestinian Refugees).

The Preparatory Period shall end not later than May 4th 1999.

2. During this period it is agreed that the following shall be implemented:

a. The Final Status Agreement with all Annexes will be prepared, based on the agreements and principles laid down in this Framework Agreement.

b. Consequently, and based on the mechanisms for border delineation set out in Annex One to the Final Status Agreement, the joint delineation of borders and official extra-territorial and other passages shall be finalized.

c. The Israeli-Palestinian Coordinating Security Commission (CSC) shall be established and commence its deliberation, not later than May 5th 1998. The CSC shall establish the mechanism for dealing with security issues relating to Israeli citizens in the State of Palestine, and Palestinian citizens in the State of Israel.

d. The Parties shall invite the co-sponsors to the Peace Process and other agreed upon third parties, to establish an International Observer Force (IOF) as agreed upon in Annex two to the Final Status Agreement.

e. The Government of Israel shall establish a program to encourage Israeli settlers to resettle within Israel's sovereign territory. Settlers wishing to take part in this program shall be compensated by the Israeli government before January 1st, 1999, according to guidelines to be announced within three months of the entry into force of this Framework Agreement.

f. The agreed upon reformed Jerusalem Municipal System shall be inaugurated not later than May 5th 1999.

g. Both sides shall prepare and agree on a Jerusalem Master Plan as described in Article VI.

h. In accordance with Article VII of this Framework Agreement, the PLO shall establish a program to encourage the rehabilitation and resettlement of Palestinian refugees presently residing in the West Bank and Gaza Strip, within these areas.

i. The Parties shall promote the work of the ICPR as stipulated in Article VII to this Agreement.

j. The Parties shall prepare an agreed upon coordinated, separate and joint water management plan for the joint aquifers.

k. As soon as possible, but not later than May 4th 1999, the interim period shall come to an end and a full Final Status Agreement shall be signed and a Peace Treaty shall be initiated.

B. The Implementation Period: May 5th 1999 to May 4th 2000

1. With the signing and entry into force of the Israeli-Palestinian Final Status Agreement, the implementation of the Final Status settlement will commence. The creation of the Independent State of Palestine within secure and recognized borders shall be promulgated by the PLO and its relevant agencies. Immediately thereafter, but not later than within two months, the Peace Treaty shall be signed.

2. The Government of the State of Israel shall extend immediate and full diplomatic recognition to the State of Palestine and to al-Quds as its capital, as described in Article VI and Annex Three to the Final Status Agreement.

3. The Government of the State of Palestine shall extend immediate and full diplomatic recognition to the State of Israel and to Yerushalayim as its capital, as described in Article VI and Annex Three to the Final Status Agreement.

4. Provisions relating to the normalization of Israeli-Palestinian relations shall be implemented as described in Article III.

5. Upon entry into force of the Israeli-Palestinian Final Status Agreement, the withdrawal of Israeli Military and Security Forces shall commence and the agreed security provisions shall be implemented according to the schedule described in Article II and Annex Two to the Final Status Agreement.

6. Within the "City of Jerusalem" elections for the two sub-municipalities will be held. The two sub-municipalities shall appoint a Joint Parity Committee for the Old City Area (as outlined in Article VI paragraph 12 to this agreement), and a proportional (2:1) Joint Higher Municipal Council which will elect the Mayor of the "City of Jerusalem"

7. The parties agree to continue to work jointly and separatly within the framework of the multilateral working groups and other relevant fora towards:

a. The establishment of a Middle East free from hostile coalitions and alliances;

b. The creation of a Middle East free from weapons of mass destruction both conventional and non-conventional within the context of a comprehensive, lasting and stable settlement.

C. The Post-Implementation Period: May 5th 2000 to May 4th 2007

1. Israeli residual forces shall remain on Palestinian territory. The CSC shall continue to coordinate Israeli and Palestinian security needs.

2. Responsibility for the security of Israeli citizens residents in the State of Palestine, shall remain with the CSC.

D. The Post-November 5th 2007 Period