Any responses would be very helpful in my understanding of this difficult topic!
In short, they were dispossessed of their lands in an attempt to displace them and replace them with a Protestant settlement. This came after the final defeat of the Gaelic Chieftains at the Battle of Kinsale in 1601. Up until that point Ulster was the most Gaelic of the Irish provinces so it had proved a difficulty for the English Crown to control and bring under English law.
The guidelines for the Plantation of Ulster are contained in a parliamentary document known informally as 'The Printed Book' of 1610. First and foremost it was to be a Protestant settlement i.e no Catholics were allowed own or settle on the land [just about the whole of Ulster] that had been confiscated by the Crown. Lord Chichester the Lord Deputy of Ireland, believed that the entire country might be transformed into loyal subjects using this system of dispossession and replacement. He saw the defeat and departure of the Gaelic Chieftains as the opportunity for “a plantation of the whole realm, and especially the fugitive counties [in Ulster].” The “fugitive counties” of the northern region were planted with people invited to come in for the purpose of displacing the native population.
Segregation was the basis for settlement. It was declared in law that no native Irish were to be allowed to settle on the confiscated land. In addition, no one taking possession of the land could hire the Irish in any way. Craftsmen and labourers were to come in from Scotland so that the entire community would be made up of the Protestant new comers. Any Protestant found violating the law and hiring the native Irish would lose their property. But this proved to be impossible to carry out mostly because they needed the native Irish as servants and labourers.
Between the years 1610 and 1630 over 40,000 Protestant immigrants settled in Ulster. The area being planted covered the modern counties of Armagh, Tyrone, Donegal, Derry, Fermanagh, and Cavan. Counties Down and Antrim were excluded because successful private plantations had already taken place there with a group of specially chosen families from Scotland who would be certain to remain loyal subjects of the Crown.
To act as possible defenses against a hostile native population one of the laws states that “the said undertakers, their heirs and successors, shall have ready in the house at all times, a convenient store of arms.” The Protestant tenants were also to build stone homes to be clustered around a principal residence of the Protestant land owner. As to the Irish Catholic natives, those few who were legally allowed to remain in a designated area were to be given “an allowance of timber” to build homes in the areas they were assigned to but warned that “there will be a proviso or forfeiture of their homes if they enter into actual rebellion.” There were a few Gaelic Lords who had been granted land ['deserving Irish' who were deemed not to be rebellious] but their taxes were considerably higher than the Protestant settlers and they found it impossible to survive and were shortly to find themselves heavily in debt. This was likely the plan. Ultimately, the amount of land in their hands was steadily eroded over time as more and more land went to the planters.
The economy in the province was in the hands of the new Presbyterian settlers and Belfast, the new town, was given a charter by King James in 1613. It became the centre of that Protestant economy. Catholics were excluded from this new community and from its economy but they did become the servants of these planters.
The native Irish population remained a sizeable community. In fact in counties Donegal, Cavan, Fermanagh and Derry the native Irish Catholics remained a majority. In spite of the initial plan to keep the two communities absolutely separate not enough support type families came in to Ireland to act as servants and labourers to the new landowners. This created a gap in the system because the planters could not exist without someone to take on these servile roles. With no other option open to them, the native Irish became the underlings of the planters. Consequently the area became a region of discontent and frequent rebellion by the dispossessed native Catholic Irish.