UNITED NATIONS, Aug 12: Libya, the United States and Britain have signed off on a deal for resolving the long-simmering diplomatic dispute over responsibility for the 1988 bombing of Pan Am Flight 103, diplomats said on Tuesday.

“There is now sign-off from all three governments. All that is left are the practical steps,” said one diplomat.

The deal could lead to a Security Council vote ending U.N. sanctions on Libya early next week, provided that Libya carries out its commitments under the deal, council diplomats said.

The sanctions were imposed on Tripoli after the midair bombing of the Pan Am jumbo jet over Lockerbie, Scotland, which claimed 270 lives.

To have the U.N. sanctions permanently lifted, Libya must pay compensation to the families of the victims, take responsibility for the attack, renounce terrorism and agree to cooperate in further investigations.

Word of a final agreement on a resolution of the dispute came a day after US, British and Libyan officials held a fresh round of talks in London on settlement terms.

Monday’s London meeting was the latest in a series of three-way talks called to evaluate Libya’s progress in meeting the conditions for lifting the sanctions. These talks “confirmed everyone was on board,” a diplomat said.

The U.N. Security Council imposed an air and arms embargo and a ban on some oil equipment on Libya in 1992 and 1993 to pressure the country to hand over two Libyan suspects for trial.

The sanctions were suspended when Libya turned them over in April 1999, and intelligence agent Abdel Basset al-Megrahi was subsequently convicted while the second suspect was acquitted.

Libya, backed by other Arab nations, now wants the sanctions formally lifted while the international community wants Tripoli to take responsibility for the atrocity.

In a crucial step forward, lawyers for the families last week met Libyan officials and representatives for the Bank for International Settlements in Paris to discuss finalizing arrangements for an escrow account to hold 2.7 billion dollars, or up to 10 million dollars per victim, that Libya has agreed to pay in compensation.

The lawyers told their clients they hoped to meet again on Wednesday in Europe to sign an escrow agreement.

Under a scenario which all three governments have now agreed to, Libya would then send the Security Council a statement, worked out in advance, formally accepting responsibility for the bombing.

The council would then proceed to a vote on lifting the sanctions, probably early next week, diplomats said.

The Wall Street Journal said on Tuesday a plan had already been worked out for Security Council action under which Britain would introduce a resolution to end the sanctions and the United States would abstain from voting.

US and British officials had no comment on that report.

The lifting of bilateral US sanctions on Tripoli, which include a ban on imports of Libyan crude oil to the United States dating to 1982, is a completely separate issue on which quick action is not expected since the US government is divided on the matter, diplomats said.—Reuters