By Steven Erlanger

 JERUSALEM: The International Committee of the Red Cross, in a confidential report about Israel's annexation of East Jerusalem and surrounding areas, accuses Israel of a "general disregard" for "its obligations under international humanitarian law - and the law of occupation in particular."

The committee says that Israel is using its rights as an occupying power under international law "in order to further its own interests or those of its own population to the detriment of the population of the occupied territory," which it says is "foreign to the letter and spirit of occupation law."

Israeli policies in East Jerusalem, the committee says, are "reshaping the development of the Jerusalem metropolitan area" with "far-reaching humanitarian consequences," including the isolation of Palestinians living in Jerusalem from the rest of the West Bank, problems of access to basic services and a "condition of artificial illegality" in which thousands of Palestinians live in Jerusalem without the ability to get permanent residency.

With the construction of the separation barrier, the establishment of an outer ring of Jewish settlements beyond the expanded municipal boundaries and the creation of a dense road network linking the different Israeli neighborhoods and settlements in and outside Jerusalem, the report concludes, Israel is consolidating "a Greater Jerusalem Envelope" that fragments Palestinian communities and severs East Jerusalem from the West Bank.

The committee recognizes that the separation barrier "was undertaken with an undeniable security aim," but adds, "The route of the West Bank barrier is also following a demographic logic, enclosing the settlement blocs around the city while excluding built-up Palestinian areas (thus creating isolated Palestinian enclaves)."

Israeli officials say they reject the very premise of the report - that East Jerusalem is occupied - noting that they annexed it after the 1967 war and offered full rights to its residents.

The committee does not publish its reports but provides them in confidence to the parties involved and to a small number of countries. The committee is recognized in the Geneva Convention of 1949 as a guardian of international humanitarian law, and says it tries to ensure that all parties to a conflict respect those rules and principles. It plays an important, quiet role in visiting prisoners all over the world.

The report considers all land that Israel conquered in the 1967 war to be occupied territory under international law and does not recognize Israel's annexation of East Jerusalem. The report was the result of nine months of work by the committee and was delivered in late February "to Israel and to a small number of foreign governments we believe would be in the best position to help support our efforts for the implementation of humanitarian law," said Bernard Barrett, a spokesman in Jerusalem for the committee.

The report was provided to The New York Times by an individual with access to all parties who wanted the conclusions of the report publicized even as Israel celebrates Jerusalem Day this Wednesday, marking the 40th anniversary of the unification of the city. Barrett said that the committee did not approve the leaking of the report, which he said was part of "an ongoing process of private discussion" with Israel.

Israeli officials said that they respected the committee and cooperate with it gladly on issues ranging from the release of captured Israeli soldiers to asking its officials to give briefings on international law to Israeli diplomats and to Israeli commanders serving in the occupied West Bank.

Israel has received the report, but disagreed with its premises and conclusions.

"We reject the premise of the report, that East Jerusalem is occupied territory," said Mark Regev, spokesman for the Israeli Foreign Ministry. "It is not. Israel annexed Jerusalem in 1967 and offered full citizenship at the time to all of Jerusalem's residents. These are facts that cannot be ignored."

Until the Israeli annexation, after the 1967 war, the last legal sovereign in East Jerusalem had been the British under a mandate committed to establishing a Jewish state in Palestine, he said.

Israel, he said, "is committed to a diverse and pluralistic Jerusalem, to improving the conditions of all the city's inhabitants and to protecting their interests as part of our sovereign responsibility." He added, "If any population in Jerusalem is thriving and growing, it is the Arab population."

He also noted that Israel makes great efforts to ensure health care for Palestinians, pointing to 81,000 entry permits in 2006 for Palestinians needing care inside Israel.

Miri Eisin, spokeswoman for Prime Minister Ehud Olmert, said that Israel respects the work of international organizations like the committee. "Our problem is that the premise they consistently present has no Israeli perspective in it, as if it's all just some legal issue. That is not balanced."

Mustafa Barghouti, spokesman for the Palestinian unity government, welcomed the report, calling it consistent with the rulings of the International Court of Justice, which said in a nonbinding opinion in 2004 that Israel's security barrier is illegal where it crosses the 1967 lines into occupied territory. "Israel violates international law with impunity, and couldn't continue this blunt violation for 40 years if it did not feel impunity toward the international community," Barghouti said.

He pointed to the refusal of the U.S. and European Union ambassadors to attend Jerusalem Day celebrations as proof that the world does not recognize the Israeli annexation of East Jerusalem.

The thrust of the committee's report is similar to those written by Israeli peace advocates and to an unpublished report that was written by EU diplomats in Ramallah and East Jerusalem November 2005, which was described by The Times but not authorized for release by European foreign ministers.

The essence of these reports is a concern, as the Europeans said, that Israel is creating facts on the ground in and around Jerusalem that mean "prospects for a two-state solution with East Jerusalem as the capital of Palestine are receding."