THE European Commission said on Friday it had struck a deal with the United States settling their dispute over trade with Cuba, which could lead to amendment of the US Helms Burton Act.
European Trade Commissioner Sir Leon Brittan said in a statement that the deal should allow the European Union to suspend a panel that has been set up within the Geneva based World Trade Organisation (WTO).
He said the accord struck after intensive telephone contacts between Brittan and US Under Secretary of Commerce Mr Stuart Eizenstat - would also "chart a path towards a longer term solution through amendment of the Helms Burton Act".
Sir Leon's spokesman, Mr Peter Guilford, said the US government agreed to seek Congressional approval to amend the law in return for assurances that the EU would drop its WTO complaint.
The US legislation seeks to isolate the government of Mr Fidel Castro by stopping investment, especially in property deemed by Washington to have been stolen from US citizens.
Sir Leon said the accord would also lead to talks over the question of extra territorial application of trade laws.
"In particular, the agreement will enable us to address with the US and resolve the problems caused by legislation that inhibits investment in third countries," he said.
Among other things, the HelmsBurton Act allows naturalised Americans to sue in US courts foreign companies which have investments in property confiscated by Havana since the communist revolution of 1959.
This part has twice been suspended by US President Bill Clinton - the last time in January for six months - but the EU and other third parties have nevertheless protested at what they call the extra territorial nature of the law.
The EU was due to formally present its complaint against Washington's Helms Burton Act at the World Trade Organisation (WTO) on Monday, the culmination of nearly a year of bitter wrangling.
Mr Guilford stressed that the EU maintained the right to revive its WTO complaint against Helms Burton at any time.
He said Sir Leon's aides were informing EU capitals of the deal since it must win the approval of EU trade ministers.
"We expect positive signals today," he said.
