HIGHLIGHTS: Arafat Addresses His People Wednesday||Arafat Endorses Bill Granting Independence of the Judiciary||Palestinian Authority Rejects Sharon's Demands for Reform But Lawmaker Says FATAH Has Plans to Limit Arafat's Authority||STORY: Palestinians mark Nekbah (Catastrophe) day (the day Israel was created in 1948) Wednesday. They have called for public rallies to mark the sad occasion, which saw the displacement of hundreds of thousands of Palestinians now living as refugees around the world and in their own territory. A three-minute silence will also be observed to mark Nekbah day. (Read photo caption)

Palestinian President, Yasser Arafat is to address the nation on the occasion in a speech that would call on the international community to stop the injustices to which the people of Palestine are being subjected to put an end to Israeli aggression against them.

INDEPENDENCE OF THE JUDICIARY

Yasser Arafat has meanwhile endorsed a bill approved by the Palestinian Legislative assembly stipulating complete independence of the Judiciary. In a statement issued after a cabinet meeting chaired by Arafat, the Palestinian National Authority (PA) welcomed Arafat's decision, which is to be published in the official gazette with immediate implementation effective as of the date of signing.

SHARON'S TERMS FOR RESUMING PEACE TALKS

Arafat's decision coincided with a speech in the Israeli Knesset in which, Israeli Prime Minister Ariel Sharon slammed the Palestinian Authority as being "dictatorial and corrupt" and said no peace talks would be held until it carries out what he called sweeping reforms.

After the meeting, the PA rejected Sharon's terms with the minister for planning and international organizations, Dr. Nabil Shaath saying that Sharon has no right to demand such terms describing the question of reform as being a entirely internal Palestinian affair.

For his part, Senior negotiator Saeb Ereqat described Sharon's conditions for resuming peace talks as being untenable adding that by making the demand, Sharon has in fact revealed Israel's intention to transform the PA into a shadowy civil administration, which again, Ereqat stressed, shows that Israel is not yet ready for the sort of peace outlined by the EU and Russia. The peace Israel wants, Ereqat explained, is peace under occupation.

REPORTS OF A SPLIT OVER REFORM

However, Hatem Abd Al Qader, a member of the Palestinian Legislative Council, said earlier Tuesday that Fatah is preparing a plan that would limit Arafat's powers.

In an interview to the Al Hayat daily, Abd Al Qader said a meeting with Arafat to discuss the document is expected to take place in the near future. Implementation of the document would mean that "[Arafat] will have to surrender some of his authority," he said.

Abd Al Qader stressed, however, that it would be vital that Arafat remain a key part of the Palestinian Authority. "Arafat as a leader, commander and political symbol is important, fundamental and essential," he said.

According to the Palestinian lawmaker, either a "coordinator" or a prime minister will need to be appointed to oversee contacts with the Palestinian parliament and that emergency plans to restructure the Palestinian Authority and Palestinian security services will have to be drafted.

RIFT MIGHT BE SERIOUS

At the same time, An unprecedented assault on Hassan Asfour, a Palestinian Cabinet minister, apparently by fellow Palestinians, has raised the prospect of violent internal power struggles amid reported dissatisfaction with Yasser Arafat's regime.

Lying in a Ramallah hospital bed with his right leg in a cast up to his hip, another cast on his right arm and a bandage covering his scalp, Asfour who hinted the attack could be part of an internal power struggle would not rule out that Israeli may have been behind the attack.

"It's a disgusting act with the aim of inciting a civil war," said Asfour. No one claimed responsibility.

In a statement, the Palestinian Authority condemned the assault on Asfour and called for the arrest of the attackers.

Looking for an explanation, Palestinians pointed to Asfour's links with a security chief and with Arafat.

Asfour is a key ally of Mohammed Dahlan, the head of Palestinian security in the Gaza Strip who is tipped as a possible successor to Arafat.

Dahlan's chief rival is Jibril Rajoub, the head of security in the West Bank. The two have been in a behind-the-scenes power struggle for years.

PHOTO CAPTION

Palestinian leader Yasser Arafat talks to Yitzhak Frankenthal, right, representative of Israeli families victims as Nabil Abu Rdeneh, center, Arafat's adviser laughs during their meeting at Arafat's office in the West Bank town of Ramallah Tuesday, May 14, 2002. Frankenthal, whose son Arik _ then a 19-year-old soldier _ was killed by Palestinians in 1994 while hitchhiking in the West Bank. (AP Photo/Palestinian Authority, Hussein Hussein, HO)
- May 14 4:05 PM ET