Jerusalem (CNN) -- The Israeli government said Tuesday that it has decided to legalize the status of three settlement posts that were built in the West Bank during the 1990´s.

The move to authorize the settlements of Sansana, Rechelim and Bruchin was based on "decisions by previous governments," the office of Prime Minister Benjamin Netanyahu said in a short statement.

The announcement was criticized by the Palestinians, with the settlement issue a key obstacle to any hopes of reviving the peace process.

"The Israeli government has to make a choice between settlements and peace. They can´t have both," said Saeb Erekat, chief Palestinian negotiator. "The question here, if people say they accept the two- state solution why do they continue building on land that is supposed to be for a Palestinian state? I believe the continuation of settlement activities is destroying the path of peace and path of two state solution."

Mark Regev, a spokesman for Netanyahu, said the only reason the status of the three settlements had not been formalized before was because of "technical and procedural issues"

Palestinian officials have halted all negotiations with Israel, both direct and indirect, because of the continuation of what they describe as illegal settlement building in the West Bank and Jerusalem. The Palestinians want East Jerusalem to be the capital of any future state.

The U.N. Office for the Coordination of Humanitarian Affairs said in January that since 1967, Israel has established about 150 settlements in the West Bank, including East Jerusalem, in addition to about 100 "outposts" erected by settlers without official authorization.

The settler population is estimated at approximately at 500,000, the U.N. office said. CNN´s Kareem Khadder contributed to this report. (© 2012 Cable News Network 04/24/12)