The United States has claimed the 1995 agreement between Israel and the Palestinians did not give immunity to Palestinian guerrilla leader Abu Abbas, who has been detained by US forces in Baghdad.
Under an agreement signed in 1995, members of the Palestine Liberation Organization may not be detained or tried for matters they committed before the Oslo peace accord of 1993, said Palestinian negotiator Saeb Erekat, who demanded the United States set Abu Abbas free.
But a US State Department official said: "The 1995 interim agreement concerns arrangements between Israel and the Palestinian Authority for the detention and prosecution of certain persons. It does not apply to the legal status of persons detained in a third country".
Abbas, also known as Mohammed Abbas, masterminded the 1985 hijacking of the Italian cruise ship Achille Lauroin the Mediterranean in which a disabled elderly American Jewish passenger, Leon Klinghoffer, was shot and thrown overboard.
Abbas was sentenced in absentia in Italy to life in prison for planning the hijacking.
Although he was the target of a manhunt after the incident, Washington dropped a warrant for his arrest several years ago.