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Between the State of Israel and the Palestine Liberation Organization, the Representative of the Palestinian People.

Whereas both parties wish to end the historical conflict between them, establish peace and bring about a historical conciliation between the two nations,

And whereas both parties wish to base the peace on the principles of self-determination, mutual respect, justice and equality,

And whereas both parties acknowledge the principle of "two states for two nations", which means the existence together, side by side, of the State of Israel, expressing first and foremost the identity of the Israeli-Jewish nation, and the State of Palestine, expressing first and foremost the identity of the Palestinian-Arab nation,

And whereas both parties accept UN resolutions no. 242, 338 and 194 as the basis for a solution and regard the implementation of the agreement below as the full realization of these resolutions,

It is agreed by both parties:

Section 1: The End of the Occupation.

The Israeli occupation, in all its manifestations and in all locations, in the West Bank and the Gaza Strip, as well as in Arab East Jerusalem, will end within one year from the date this agreement is signed.

Section 2: The State of Palestine.

The independent and sovereign State of Palestine will be established in the West Bank and the Gaza Strip, including Arab East Jerusalem and the part of the Dead Sea that borders the Palestinian shore and the territorial waters of the Gaza Strip, within one year from the date this agreement is signed.

Section 3: Borders

The border between the State of Israel and the State of Palestine will be the cease-fire lines as they existed on June 4th 1967 (hereinafter: the Green Line), unless otherwise determined in this agreement.

The State of Palestine has full sovereign control of all its border crossings on land, sea and air.

Both parties wish that the border between them will be open, with unrestricted passage of people and goods, within the framework of the economic and border-passing arrangements to be agreed upon by the parties.

Section 4: Jerusalem.

Both parties acknowledge the uniqueness of the City of Jerusalem, and declare their intention to preserve it as a single municipal unit, open to all.

The Arab neighborhoods of the city, according to the map attached, will be an integral part of the State of Palestine and will serve as its capital. These areas of the city will be connected to each other and to the State of Palestine as a single, continuous territorial entity.

The Jewish neighborhoods of the city, according to the map attached, will be an integral part of the State of Israel and will serve as its capital. These areas of the city will be connected to each other and to the State of Israel as a single, continuous territorial entity.

The Jewish quarter of the Old City will be part of the State of Israel and will be attached to its territory. The Muslim, Christian and Armenian quarters of the Old City will be part of the State of Palestine.

There will be no barriers or obstacles preventing unrestricted passage between the two parts of the City. Both parties will establish border checkpoints, if they so decide, at the entrances/exits of the City.

The municipality of the Palestinian Jerusalem and the municipality of the Israeli Jerusalem will establish a joint council, based on the principle of equality, to manage the shared municipal services. The council will be headed by the chairman of the council and his/her deputy, one of whom will be Israeli and the other Palestinian. They will rotate their positions after two years. The first assignment will be determined by lot.

Section 5: Holy Sites.

Both parties acknowledge the uniqueness of the Holy Sites and their importance to the believers of the three monotheistic religions.

The Haram Al-Sharif (the Temple Mount) will be part of the State of Palestine.

The Western Wall (the part also called "the Wailing Wall") will be part of the State of Israel.

No excavations, archeological or otherwise, will be undertaken in the area of the Haram Al-Sharif (the Temple Mount), the Western Wall or in their immediate vicinity unless by mutual consent. Should there be no mutual consent, an international committee of archeologists selected by mutual agreement will resolve any such issue. Should there be no mutual agreement, the committee will be appointed by the Secretary General of UNESCO.

Section 6: Exchange of Territory.

Both parties agree to a limited exchange of territory, detailed in the attached map, according to which 4% of the area of the West Bank will be transferred to the State of Israel and Israeli territory of equal size will be transferred to the State of Palestine. (The percentage is calculated on the basis of the entire area of the West Bank east of the Green Line, including East Jerusalem and the Palestinian part of the Dead Sea.)

Section 7: Extra-territorial Roads.

A highway will be constructed between the West Bank and the Gaza Strip and it will belong to the State of Palestine. The highway will not be connected to the Israeli road network at any point and will pass either above or below the Israeli roads.

To connect the territory of the State of Israel and the Israeli communities beyond its borders, which will belong to Israel according to section 6, roads will be constructed and they will be part of the State of Israel. These roads will not be connected to the Palestinian road network at any point and will pass either above or below the Palestinian roads.

The width of the extra-territorial roads will not exceed 25 meters.

Section 8: Security.

Both parties have the right to national and personal security.

Both parties renounce the use of force and the threat of force against each other.

Both parties undertake to combat terrorism and terrorist initiatives that are organized in one state and aimed at the other state, its residents and its institutions.

Both parties undertake to prevent the entry into their territories of any foreign military force. Any contravention of this section by either state will grant the other state the right to take any measures required for self-defense.

The State of Palestine undertakes to refrain from arming itself with heavy offensive weapons for thirty years. This obligation will become void if peace treaties are signed between Israel and all the Arab states and Iran.

Both parties will come to an agreement regarding the limited usage of each other's air space, as necessitated by the geographical, military and civilian circumstances.

The Palestinian side agrees that as long as there is no regional peace, Israel is entitled to maintain an early warning station inside the Palestinian territory between Nablus and Ramallah, subject to international supervision. The Israeli experts who will man this station will be replaced once every month, under the protection of the Palestinian security forces.

Section 9: The Settlements.

Residents of the settlements located in territory that is to become part of the State of Palestine will be evacuated from the territory before the end of the Israeli occupation.

The settlements will be transferred intact to the Palestinian Authorities, without any damage inflicted on buildings or other immovable property. The evacuated property will be considered part of Israel's contribution to the rehabilitation of the Palestinian refugees, (as specified heretofore in section 11.)

Section 10: Water.

Water resources of the entire area of land between the river Jordan and the Mediterranean sea belong to both parties.

A Senior Israeli-Palestinian Committee will be appointed and will be responsible for water resources and distribution. Water will be allocated justly and equally, on the basis of the numerical proportion of residents in both states.

Both parties will cooperate in projects for the development of additional water resources, such as desalination of sea water.

Should there be differences of opinion between the two parties regarding the distribution of water and no resolution can be reached by the Senior Committee, the decision will be transferred to a committee of international experts that will be appointed by both parties. Should there be no agreement on its composition, the committee will be appointed by the UN Secretary General.

Section 11: Refugees.

Both parties agree that the human tragedy of the Palestinians must be resolved by a moral, just, practicable and agreed-upon solution that takes into consideration the character and essential needs of the two states.

Israel acknowledges its share of responsibility for the creation of this tragedy during the course of the wars of 1948 and 1967. Both parties will establish a "truth commission" of historians - Israeli, Palestinian and international - that will examine in depth the precise causes that lead to the creation of the problem, and will issue an objective conclusive report within three years. This report will be incorporated into the school curriculum of both nations.

Israel acknowledges the principle of the Right of Return, as a basic human right.

According to this right, each refugee will be given the choice between compensation and permanent settlement in another country, return to the State of Palestine, or return to Israeli territory, according to the following principles:

1. In order to heal the historical wound and as an act of justice, Israel will allow the return into its territory of an appropriate number of refugees, taking into consideration its national character and keeping a reasonable demographic balance. Both parties through negotiation will determine the number of refugees who will return as well as the criteria and priorities of the allocation of return permits.. Returnees will be allowed back under a reasonable annual quota within a time-limit not exceeding 10 years.
2. A generous level of compensation will be determined for each refugee for property that remained in Israel, loss of opportunities, etc. The compensation will be paid by an international fund. Israel will contribute an appropriate portion to this fund, according to the assessment of the value of property remaining in Israel.
3. With the establishment of the State of Palestine, and according to its laws, each refugee who so desires will be accorded Palestinian citizenship, which will grant him/her the right of return to the territory of the State of Palestine. The international fund will enable the Palestinian State to absorb these refugees, as well as refugees currently residing in the West Bank and the Gaza Strip, by providing suitable housing and employment opportunities.

Section 12: Implementation of UN resolutions.

Upon full implementation of sections 1 to 9, both parties will present a formal joint statement to the UN Security Council, declaring that both parties consider resolutions 242 and 338 fully implemented. Upon full implementation of section 11, both parties will present a declaration to the UN that resolution 194 has been implemented.

Section 13: Differences of Opinion.

An international committee will be appointed to oversee this agreement.

The committee will consist of three members � appointed by the United States, the European Union and the League of Arab States. It will resolve all differences of opinion that are not resolved through direct negotiation.

Section 14: End of the Conflict.

Full implementation of this agreement will constitute the end of the conflict between Israel and Palestine.