Since June 28, 1967, East Jerusalem has been under the law, jurisdiction, and administration of the State of Israel. The right of Israel to declare sovereignty over the entirety of Jerusalem is not recognized by the international community, which regarded the move as de facto annexation  and deemed Israeli jurisdiction invalid in a subsequent non-binding United Nations General Assembly resolution.[
15] However in a reply to the resolution, Israel denied that these measures constitute annexation.
In the 1980 Basic Law, or "Jerusalem Law" Israel declared Jerusalem "complete and united", to be "the capital of Israel". The new law left the bounds of Jerusalem unspecified. In response, the UN Security Council unanimously adopted the non-binding Resolution 478 (the U.S. abstained), declaring the law to be "null and void" and a violation of international law.
Nevertheless, in 1988, Jordan, while rejecting Israeli sovereignty over East Jerusalem, withdrew all its claims to the West Bank (including East Jerusalem).
The Israeli-Palestinian Declaration of Principles, signed September 13, 1993, deferred the settlement of the permanent status of Jerusalem to the final stages of negotiations between Israel and the Palestinians.
The Palestinian National Authority views the future permanent status of East Jerusalem as the capital of the Palestinian state. The possibility of a Palestinian capital in East Jerusalem was considered by Israel for the first time in the Taba Summit in 2001, though these negotiations ended without an agreement and this possibility has not been considered by Israel since.
In a 1991 letter, United States Secretary of State James Baker stated that the United States is "opposed to the Israeli annexation of east Jerusalem and the extension of Israeli law on it and the extension of Jerusalem’s municipal boundaries". However, the U.S. Senate in 1990 had adopted a resolution "acknowledging Jerusalem as Israel's capital" and stating that it "strongly believes that Jerusalem must remain an undivided city." Congress passed the Jerusalem Embassy Act on October 23, 1995, which declared that Jerusalem should remain undivided and that it should be recognized as Israel's capital.
Some international law experts, such as Julius Stone, have argued that Israel has sovereignty over East Jerusalem under international law, since Jordan did not have legal sovereignty over the territory, and thus Israel was entitled in an act of self-defense during the Six Day War to "fill the vacuum".