A European Union (EU) document, reported in The New York Times and The Guardian, urges member countries to prevent the security fence from "sealing off most of East Jerusalem" and allowing Israel a "de facto annexation" of Jerusalem. The city was re-united after the 1967 Six Day War.

The report charges that "Israeli activities in Jerusalem are in violation of both its roadmap obligations and international law." Prime Minister Ariel Sharon and virtually every previous prime minister and leader of major parties have declared that Jerusalem will remain united. The Palestinian Authority (PA) has insisted that its proposed new Arab state will include Jerusalem as its capital.

The EU report, prepared by its diplomats in eastern Jerusalem and Ramallah and written by British consulate officials, was sent to foreign ministers of the 25 countries in the group.

Israeli Foreign Ministry spokesman Mark Regev said he hoped the document would not lead to a "regression to the one-sided [European] position of the past."

The report is to be published in December, but was leaked as the EU increased its involvement in PA-Israel relations by placing European observers at the re-opened Rafiah border between Gaza and Egypt. The report, along with an EU conference in Barcelona on Sunday, may put the status of Jerusalem in the forefront in the current Israeli election campaign.

PA Chairman Mahmoud Abbas is to attend the Barcelona meeting, but both Prime Minister Ariel Sharon and Foreign Minister Silvan Shalom have absented themselves to continue their campaign in the upcoming elections in Israel. Finance Minister Ehud Olmert is taking their place. Abbas is expected to exploit the opportunity to demand that Israel tear down the security fence.

The EU implicitly has sided with the Palestinian Authority against Israel on the status of Jerusalem. Its official policy states, "The EU opposes... actions aimed at changing the Palestinian character of East Jerusalem."

The EU has blamed Israel for policies that it says "are reducing the possibility of reaching a final-status agreement on Jerusalem that any Palestinian could accept," because the security fence separates 230,000 Arabs from Judea and Samaria. The result is a "de facto annexation of Palestinian land," according to the report, which the Times said was leaked "from someone who wanted to publicize it."

Diplomats also accused Israel of "radicalizing the hitherto relatively quiescent Palestinian population of East Jerusalem" by discrimination against them on matters of work and building permits, house demolitions and taxation.