This is Israeli-occupied territory, therefore Israeli law does not apply. Israel "rules" by means of "military orders", and those orders must comply with the int'l laws of belligerent occupation. Hague Regulations, Article 45: "Private property cannot be confiscated". There is simply no way that Israel can legallydo what Netanyahu proposes.
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Sweden arrests 14 over plan to attack asylum center (AP)
from the article: Netanyahu seeks to legalize outposts built on private Palestinian land