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A veteran Canadian Middle East diplomat is putting forward a controversial plan to crack one of the world's most intractable diplomatic conundrums: how to govern the Old City of Jerusalem and its maze of holy sites, claimed by both Israelis and Palestinians as their sovereign territory and national capital.

The study, led by Michael Bell, a former Canadian ambassador to Israel, offers a formula for Palestinians and Israelis to deal with an issue that has long bedevilled efforts toward a wider peace settlement.

While several plans for the future of the larger municipality of Jerusalem have called for dividing jurisdiction or sharing sovereignty in the city, no plan has produced a workable formula for dealing with the holy sites in the compact Old City, a one square kilometre area that has proven to be the undoing of every far-reaching attempt at a peace agreement, write Mr. Bell and Daniel Kurtzer, a former U.S. ambassador to Israel and Egypt, in the latest issue of Foreign Affairs.

"Quite simply, the Old City cannot be divided between the Israelis and Palestinians," wrote Mr. Bell and Mr. Kurtzer. "It is too small, too densely populated, too architecturally linked, and the Israelis and the Palestinians are too riven by systemic distrust for them to govern the Old City on their own."

Instead of trying to carve it up or to govern it together, Mr. Bell and his mostly Canadian colleagues suggest that a "special regime" be created to administer the affairs of the Old City to the satisfaction of both parties and allow them to put aside - but not relinquish - their competing claims of sovereignty.

Under this plan, "the parties don't lose control of the Old City," explained Mr. Bell in an interview, "because they jointly would be appointing the administrators of the city."

"In the past, there were only three options to resolving the status of the Old City: complete Israeli sovereignty, complete Palestinian sovereignty, and some kind of shared or divided sovereignty," Mr. Bell said.

"This proposal offers a fourth option, one that allows the parties to postpone the difficult task of dealing with the Old City and lets them get on with the other matters of a peace treaty between them."

The far-reaching scheme - which emerged from The Jerusalem Old City Initiative, a long-term study out of the University of Windsor - calls for the two parties to create an Old City board "consisting of senior Israeli and Palestinian representatives and a limited number of international participants selected by both sides."

The board would appoint for a fixed, renewable term, a chief administrator, "an experienced and internationally respected individual who is neither Israeli nor Palestinian," who would be the special regime's executive authority.

The regime would have its own independent police and security forces, made up of international personnel, an autonomous bureaucracy, and even an independent legal system with a dispute resolution mechanism.

"Anything that has to do with life in the city - entry and exit, access to the holy sites, property ownership, zoning, archaeology, etc. - would be governed by this regime," explained Mr. Bell, the Paul Martin Senior Scholar at the University of Windsor who, in addition to the Israel posting, served as ambassador to the Palestinian territories, Egypt and Jordan. "While anything pertaining to broader national matters - political rights, health care, education, etc. - would still be governed by the respective national government."

"The concept of a 'special regime' is not a new idea," said Diana Buttu, an international lawyer and former adviser to the Palestinian Authority on final status negotiations.

"Faisal Husseini used the term for years," she said, referring to the late leader of Palestinians in Jerusalem, who had been active in pursuing peace during the 1980s and 1990s.

"He could have remained resolutely opposed to the Israelis," Ms. Buttu said, "but he saw ideas like this as the only way to share the place peacefully.

"It becomes less about sovereignty, no longer a zero-sum game," she said.

"Both sides can emerge as winners."

Not all Palestinians share her enthusiasm. Some, such as Hatem Abdel Kader, an adviser on Jerusalem to Palestinian Authority president Mahmoud Abbas, are reluctant to part with their sovereign claims.

"We reject any sort of plan to put Jerusalem under international supervision," he said. "We are the lawful owners of the land and do not accept any attempts at pushing us away from our role as the rulers of Jerusalem."

Mr. Bell emphasizes that his group's plan, just an idea and not meant to be forced on anyone, "is not about internationalizing the city. It's about administering it through an impartial regime, until such time as the parties want to change it."

Under such a proposal, Israel, which incorporated the Old City into its Jerusalem municipality in 1967 after capturing it from Jordanian forces, would have to retreat from its control of the Old City.

Many Israelis can be expected to reject such an idea.

"I can't imagine Israel withdrawing from its sovereign claim," said Ora Aheimer, director-general of the Jerusalem Institute for Israel Studies. "But if the parties could agree to put their claims on hold, then a plan like this could conceivably work.

"Certainly, physically dividing the Old City is an impossibility. On this we fully agree."

Mr. Bell and his two senior colleagues, John Bell (no relation) and Michael Malloy, both former Canadian diplomats, began work on the initiative nearly five years ago.

This month's Foreign Affairs article marks the first public foray for their proposal.

The group has given presentations to both Israeli and Palestinian decision makers, as well as to the likes of former U.S. secretary of state Madeleine Albright and former national security adviser Zbigniew Brzezinski.

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Geography of conflict

The Old City of Jerusalem contains a number of sites important to Judaism, Christianity and Islam, including the Western Wall and the Dome of the Rock.

They have been a steady source of conflict between Israel and the Palestinians. In 2007, dozens of Israeli police and Palestinian protesters were injured when about 150 Palestinians barricaded themselves into the compound of the al-Aqsa mosque, after Israeli police fired stun grenades and tear gas at protesters. Tensions had been mounting for days after Israeli archaeologists began digging up a stone ramp near the Dome of the Rock, known to Muslims as the Haram al-Sharif, or Noble Sanctuary, and to Jews as the Temple Mount.

TONIA COWAN, CARRIE COCKBURN, TRISH McALASTER / THE GLOBE AND MAIL

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