The dispute between Israelis and Palestinians, who both claim Jerusalem as their capital city, has been described as "one of the most intractable issues in the Israeli–Palestinian conflict", with conflicting claims to sovereignty over the city or parts of it, and access to its holy sites. The main dispute revolves around the legal status of East Jerusalem and especially the Old City of Jerusalem, while broader agreement exists regarding future Israeli presence in West Jerusalem in accordance with Israel's internationally recognised borders.
Most countries support that Jerusalem should be the future capital of both Israel and Palestine; this position has been endorsed by the United Nations, the European Union, and individual countries such as France. Russia, among other countries, already recognizes East Jerusalem as the capital of Palestine, and West Jerusalem as the capital of Israel.
The majority of United Nations (UN) member states hold the view that the final status of Jerusalem should be resolved through negotiation, and have therefore favored locating their embassies to Israel in Tel Aviv, prior to a final status agreement. Only four countries have embassies to Israel in Jerusalem: the US, Guatemala, Honduras and the partially recognized Kosovo.
Background
From 1517 until the First World War, Jerusalem was part of the Ottoman Empire. It was part of the Damascus eyalet (province) until, as a result of widespread administrative reform in the mid 1800s, it became an independent sanjak (district) in 1872. From the 1860s, the Jewish community became the largest religious minority grouping in the city and from 1887, with the beginning of expansion outside the old city walls, became a majority.
Throughout the 19th century, European powers were competing for influence in the city, usually on the basis (or pretext) of extending protection over Christian churches and holy places. Much of the property that is now owned by the churches was bought during this time. A number of these countries, most notably France, entered into capitulation agreements with the Ottoman Empire and also established consulates in Jerusalem. In 1847, with Ottoman approval, the first Latin patriarch of Jerusalem since the Crusades was established.
After capturing Jerusalem in 1917, the United Kingdom was in control of Jerusalem; initially under a wartime administration, then as part of the Mandate of Palestine assigned to Britain in 1920. The principal Allied Powers recognized the unique spiritual and religious interests in Jerusalem among the world's Abrahamic religions as "a sacred trust of civilization", and stipulated that the existing rights and claims connected with it be safeguarded in perpetuity, under international guarantee.
However, the Arab and Jewish communities in Palestine were in mortal dispute and Britain sought United Nations assistance in resolving the dispute. During the negotiations of proposals for a resolution that culminated in the United Nations Partition Plan for Palestine (also known as Resolution 181) in November 1947, the historic claims of the Vatican, Italy and France were revived. The Vatican's historic claims and interests, as well as those of Italy and France were based on the former Protectorate of the Holy See and the French Protectorate of Jerusalem. From their point of view this proposal was essentially to safeguard Christian holy sites and was expressed as a call for the special international regime for the city of Jerusalem. This status was also confirmed in UN General Assembly Resolution 194 in 1948, which maintained the position that Jerusalem be made an international city.
The United Nations Partition Plan called for the partition of Palestine into separate Arab and Jewish states, with Jerusalem (with borders expanded to include Bethlehem, see UN map of Jerusalem) being established as a corpus separatum, or a "separated body", with a special legal and political status, administered by the United Nations. The Free City of Danzig was a historical precedent for this solution; Trieste was a contemporaneous city ruled by the UN. Jewish representatives accepted the partition plan, while representatives of the Palestinian Arabs and the Arab states rejected it, declaring it illegal.