The new deal for the 1989 bombing of the UTA airliner over Niger was signed Wednesday night in Tripoli, Libya. The deal, announced in Paris, follows the $26 million Libya paid in a 1999 agreement.
Details of the deal have not been released, CBS News Correspondent Elaine Cobbe reports. It means France can now vote in favor of lifting sanctions on Libya. Paris had been pushing for that for several years.
But when the families of the victims of the 1988 Pan Am 103 crash struck their $2.7 billion compensation deal with Tripoli last month, families demanded more. The French government was forced to back their demands.
The package was expected to be approved Thursday. A Libyan official from the Gadhafi International Association for Charitable Organizations, a charity headed by a son of Libyan leader Moammar Gadhafi, said the compensation package would be signed.
The agreement would create a foundation to pay families of the victims and allow France to support a British-backed Security Council resolution completely lifting U.N. sanctions against Libya. The penalties have been suspended since 1999.
"France does not oppose that the Security Council votes for the lifting of sanctions as quickly as possible," said French Foreign Minister Dominique de Villepin. "We hope that a new page will therefore be turned in ties between France and Libya."
France, which has veto power as a permanent member of the Security Council, threatened to block the resolution without an agreement on the UTA bombing. On Tuesday, the United Nations delayed a vote on the measure until Friday because of the French threat.
It was not immediately clear whether further negotiations would be needed between the two parties to fix the amount of the compensation.
Francis Szpiner, a lawyer for SOS Attentats, one of the groups supporting the victims, suggested that more work was needed to clinch a definitive deal.
"Today we can foresee a solution that will allow families of victims to end their grieving," he said.
A French court convicted Gadhafi's brother-in-law and five other Libyans in absentia for the bombing over the Sahara desert and sentenced them to life in prison. They remain at large.
It was unclear whether the deal included an acknowledgement of responsibility for the bombing by Libya.
France said last week that the "foundations" of an agreement had been reached, and Gadhafi also announced a deal. But last-minute deliberations apparently held up announcement of the final package.
The United States and Britain have pressed for a lifting of the U.N. sanctions since Aug. 15, when Libya agreed to the Lockerbie deal — which will pay up to $10 million to each victim's family — and acknowledged responsibility for the attack.
By comparison, the 1999 UTA deal paid each victim's family about $194,000.
The UTA DC-10 was flying from Paris to Brazzaville, Republic of Congo, when it exploded Sept. 19, 1989, over Niger's Tenere Desert, one of the world's remotest spots. Victims came from 17 countries, with France suffering the most casualties — 54, according to "Angry families of the UTA DC-10," a support group of relatives.
The seven American victims included a U.S. ambassador's wife, Bonnie Pugh.
The U.N. sanctions, which include a ban on arms sales and air links with Libya, were suspended in 1999 after two Libyans sought in the Lockerbie bombing were handed over for trial, but Libya has pressed for the embargoes to be lifted entirely to restore its international standing.
Despite accepting that Libya had fulfilled its requirements, the United States says it will maintain its own sanctions and keep Libya on its list of state sponsors of terrorism. Those sanctions keep most Americans from traveling to Libya and bar U.S. oil companies from doing business there.