Proximity talks are set to begin, but Israeli intelligence says Pres. Abbas is preparing for their failure. Israelis harshly criticize a PA ban on settlement goods, but the PA insists on the legitimacy of the ban and the Palestinian Economy Minister defends the ban in the Jerusalem Post. PA security officers are arrested in Jerusalem by Israel. Israel considers expanding areas of Palestinian control in the occupied West Bank. Palestinians accuse settlers of setting fire to a mosque. Hamas fears an economic crisis could spark a revolt in Gaza. Settlers continue to expand unauthorized outposts. The UK has refused to accept the new Mossad representative after expelling its predecessor. Six Palestinian MKs who traveled to Libya are under heavy criticism after returning to Israel. Emile Hokayem says the one-state agenda is a romantic but dangerous fantasy. Adel Safty says PM Netanyahu's stated positions do not allow for any progress.