Leaders of the Zionist Union and Yesh Atid, the second and fourth largest parties in the Knesset respectively, have both warned against its passage.
Prime Minister Benjamin Netanyahu was not present for the vote, as his scheduled return from a trip to the United Kingdom was delayed.
Prime Minister Benjamin Netanyahu leads the weekly cabinet meeting at his office in Jerusalem, February 5, 2017.
"The law will be voted upon and it has a majority", Shaked told participants of a cyber-security forum at Tel Aviv University, Arutz Sheva reported.
Ben Nun said Netanyahu's support for the bill was an attempt to "divert the public debate" from corruption allegations levied against him, as well as a move to "satisfy the extreme right wing".
"We do not surprise our friends and we keep them updated", he said in a briefing with reporters.
Last week, Trump's spokesman Sean Spicer told Israel that new settlement construction in the West Bank "may not be helpful" in achieving a Middle East peace - a mild rebuke compared to those by the Obama administration. "We call upon the global community to act immediately to stop it or punish the occupation if the bill is passed". ADL leaders said it would harm Israel's image overseas and lead to legal repercussions.
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The global community considers all Jewish settlements to be illegal, but Israel distinguishes between those it sanctions and those it does not, dubbed outposts. The organization also said the measure was "a slap in the face of the worldwide community".
Up until now, Netanyahu had every reason to believe that his agenda to colonize Palestinian land would meet with unhesitating approval from the Trump administration, whose core team on Israel-senior adviser and Trump son-in-law Jared Kushner, Trump's designee to lead worldwide negotiations Jason Greenblatt, and Trump's nominee to be ambassador to Israel David Friedman-are all staunch backers of Israeli settlements.
The ADL and AJC have traditionally been hesitant to weigh in on Israeli domestic issues.
"The law passed by the Knesset today proves yet again that Israel has no intention of ending its control over the Palestinians or its theft of their land", the group said in a statement.
One, B'Tselem, called the vote a "disgrace" and accused lawmakers of "lending a semblance of legality to this ongoing act of plunder".
However, the White House immediately undercut its claims to continuity in policy by rejecting a half-century of bipartisan positions on Israeli settlements. The new law, which is expected to be appealed, would offer Palestinians compensation for their loss.