Palestinian leader Yasser Arafat has signed into law a nearly two-year-old bill naming
Jerusalem as the Palestinian capital.
He took the action in response to a new US law which called for the city to be regarded as Israel's
capital, sparking anger among Palestinians.
The fresh tension over Jerusalem comes as the foreign policy chief of the European Union, Javier Solana, arrives
in Israel for talks.
Protests continue in Ramallah and elsewhere against military curfews
Sporadic violence has also continued in West Bank towns, with a fifth Palestinian child being killed
in confrontations with Israeli troops in two weeks.
Embassy change demanded
US President George W Bush signed the new provision on Jerusalem as part of a much broader bill allocating
the budget to the State Department.
He insisted that US policy towards the status of Jerusalem - claimed by both Israel and the Palestinians
had not changed.
The US says the status of Jerusalem has to be decided as part of a permanent solution between the Palestinians
But the law, in which the US Congress demanded that the US embassy be moved from Tel Aviv and for Jerusalem
to be listed as the Israeli capital in all official documents, provoked protests among Palestinians.
The fifth child to die in two weeks was killed during a confrontation in Nablus
Mr Arafat called its signing a "catastrophe", and Palestinians and Arabs saw it as a biased move backing
Israel's claims to the city which they want as the capital of a future state and as the centre of Palestinian legislative,
judicial and executive authorities.
The new Palestinian law on Jerusalem is itself almost wholly symbolic, correspondents say, as Israel
retains full control of the city it annexed in 1967.
On Saturday, a 15-year-old died as youths defied military curfews in the town of Nablus and hurled
stones at Israeli army jeeps and tanks. The soldiers inside then opened fire on them.
Four other Palestinians aged between 10 to 15 have been killed by Israeli gunfire in and around Nablus
in the last two weeks, during which time an Israeli soldier and two Palestinian adults have also died.
Mr Solana is scheduled to hold talks on Sunday with Israel's Defence Minister Binyamin Ben-Eliezer
and Foreign Minister Shimon Peres, and on Monday with Mr Arafat.
He will be pushing the "road map for peace" developed earlier this year by the so-called Quartet, comprising
leaders from the EU, United Nations, US and Russia.
Mr Bush meanwhile will meet Israeli Prime Minister Ariel Sharon later this month, an administration
Israeli radio said Mr Bush, Israel's staunch ally, had invited Mr Sharon for what will be his seventh
visit since assuming leadership of Israel in March last year to discuss possible conflict in Iraq.