Europe Lifts Libya Sanctions

The European Union on Monday ended 11 years of sanctions against Libya and eased an arms embargo to reward the North African country for giving up plans to develop weapons of mass destruction.

The move reflected a significant warming of relations in recent months.

"This is a turning point in relations with Libya," French European Affairs Minister Claudie Haignere said.

The decision by the 25 EU foreign ministers followed last year's decision by the United Nations Security Council to lift 11-year U.N. sanctions against Tripoli.

Britain was pushing for a complete normalization of relations between the EU and Libya and a full lifting of the arms embargo, according to a senior British official in London.

The United States last April lifted most of its commercial sanctions after Libyan leader Moammar Gadhafi abandoned his banned weapons programs.

But trade restrictions, including an arms embargo, remain on the books.

Gadhafi garnered international backing with his decision to accept responsibility for the 1988 Pan Am 103 bombing. Libya has pledged $2.7 billion to compensate families of the airliner's 270 victims — $10 million per family.

The U.S. 1996 Libya sanctions law prohibited U.S. companies from investing in Iran and Libya. Sanctions also could be applied under the law to foreign companies that made investments in either country in excess of $40 million. In 2001, Congress extended the law for an additional five years. In the eight years the law has been in effect, no foreign company has been sanctioned.

Foreign firms can now feel free to carry out energy-related investment in Libya without fear of U.S. reprisal.

The main remaining sanction is Libya's presence on the U.S. list of state sponsors of terrorism. Nations on the list are barred from receiving arms-related exports or sales of U.S. origin or receiving U.S. economic assistance. The U.S. government also is barred from supporting loan requests from such countries in international lending institutions.