Rebel Shi'ite cleric Moqtada al-Sadr plans to create a political party that could participate in Iraq's first free elections early next year, his spokesman said today.
US officials want Sadr to be excluded from the political process and face Iraqi justice in connection with the murder of a rival cleric last year. He denies the charges.
Sadr's Mehdi Army militia launched an uprising against US-led occupying troops in April. Earlier this month he agreed a truce involving Iraqi authorities.
Under a deal announced by the interim government this month, private militias are to be disbanded. Those with illegal militias would be banned from political office for three years.
Elections are due to be held in Iraq by the end of January 2005, according to the internationally-backed plan for the country's political transition.