The Ran in Nedarim (among others) paskens lhalacha that dina dmalchusa does not apply in Eretz Yisroel. Since the reason for dina dmalchusa is that the local government has no obligation to admit Jews in their country, since they do so we owe them dina dmalchusa dina. On the other hand, every Jew has a Torah right to live in Eretz Yisroel. That right isn’t dependent on the current local governing authority of Eretz Yisroel. As such, the halacha is that dina dmalchusa isn’t in force in Eretz Yisroel.
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