The new policy was agreed on last summer, but was not revealed until last week.

The cabinet decision is based on the Absentee Property Law, which includes in its definition of an absentee anyone who at the time of the 1948 War of Independence "was in any part of the Land of Israel that is outside the area of Israel."

The Absentee Property Law declares that buildings and property owned by "absentees" automatically become government property. Most of the property owners in eastern Jerusalem live in Judea and Samaria, which were part of Jordan until the country abandoned the land and its citizens during the Six-Day War in 1967. A lawyer representing Arabs has appealed to Attorney-General Menachem Mazuz to overturn the policy.

The revelation of the cabinet decision comes on the heels of secret purchases by Jews of Arab buildings and the renewal of Jewish neighborhoods in several areas. The Elad organization has bought dozens of buildings the past few years in the original City of David, below the entrance to the Western Wall (Kotel) plaza, and dozens of Jewish families live there.

Another initiative is the Yemenite Village, near the City of David, while organizations such as Yeshivat Ateret Cohanim, Yeshivat Beit Orot and Uvneh Yerushalayim have also re-created facts on the ground in the following Jerusalem neighborhoods:

* Shimon HaTzaddik (just to the east of Route 1 connecting the Old City with northern Jerusalem);

* Beit Orot "", the first living Jewish presence in 2000 years on Mt. of Olives;

* Maaleh HaZeitim (just south of the Old City and Mt. of Olives);

* and Kidmat Tziyon, otherwise known as Abu Dis, sponsored by Ateret Cohanim "".