Israel's government has approved the creation of a commission of inquiry to investigate alleged police misuse of the Pegasus spy software.
The Cabinet voted in favour of the measure at a meeting in Jerusalem on Sunday, despite the objections of top law enforcement officials.
The Israeli outlet Calcalist reported last year that Israeli police had for years used NSO Group's Pegasus surveillance software to wiretap government critics, businessmen, local politicians and one of Netanyahu's sons without judicial warrants.
The article, which did not provide evidence to back up the claims, led to the Israeli firm filing a lawsuit against Calcalist.
The Justice Ministry issued a report that largely debunked the allegations of phone hacking, but conceded that police had in some instances overstepped their legal authority.
Attorney General Gali Baharav-Miara opposed the establishment of the commission of inquiry, saying it could have a possible influence on the ongoing corruption trial against Netanyahu.
Justice Minister Yariv Levin, who had proposed the commission to examine the conduct of police and prosecutors, reportedly accused her of having a conflict of interest herself on the issue.
Netanyahu left the room during the vote due to his own potential bias.
Levin is seen as the driving force behind a set of controversial judicial reforms in Israel, which have provoked some of the biggest protests in the country's history.
He has repeatedly clashed with Baharav-Miara, a fierce critic of the overhaul.
The alleged use of Pegasus to spy on the mobile phones of high-profile individuals, including journalists and human rights activists, caused an international stir in 2021, when a global consortium of journalists reported on a dataset of 50,000 numbers said to have been selected by NSO customers as potential targets.
The firm denied the reports, saying Pegasus was meant to track terrorists and criminals and was sold only to government agencies.