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The concept of a ‘belligerent occupation’ does not apply here. What country owned the territory that Israel ‘occupied’? Not Jordan, which was there illegally, nor Britain, whose Mandate had ended, nor the Ottoman Empire, which no longer existed. The nation with the best claim was Israel, the nation-state of the Jewish people, who were the intended beneficiaries of the Mandate. Judea and Samaria are disputed, not occupied, and the Jewish people have a prima facie claim.
The upshot of the Levy Committee Report will be that Israel will end the de facto building freeze and start construction of settlements in earnest. It will also signal the end of the pursuit by Israel of the two-state solution. The Israeli center will no longer believe that Israel is an occupier and instead will believe that the land is theirs, which it is.