Of course, no one is praising Israel for the move.
The criticism of Palestinian prime minister Mohammad Shtayyeh is more interesting than perhaps he realizes.
He said, "the terms A, B and C no longer exist because Israel has violated the Interim Oslo Agreement , And we do not need permission from the occupying power to build our homes on our territory."
If Israel is the occupier, then legally the residents of the territory do indeed have to get permission to build homes from the military government. By definition, in a belligerent occupation, the military government is the government entrusted with upholding and maintaining the existing laws in the territory, although it can add additional rules for security purposes under the Geneva Conventions.
When Shtayyeh says that Palestinians have the right to build anywhere in the territories, he is saying that the land is not legally occupied - but disputed.
Which has been Israel's legal position since 1967!
UPDATE: Abbas' spokesperson says the same thing!