LONDON Ñ Libya has settled a $2.7 billion compensation claim with
the families of the victims of the 1988 bombing of a U.S. passenger jet over
The North African country was said to have assumed responsibility for
the downing of Pan Am Flight 103, in which 270 people were killed. Libya
signed an accord to pay $10 million in compensation for each victim.
The settlement was concluded and signed in London on late Wednesday
in a meeting between Libyan representatives and attorneys for the families
of the victims. This was the last meeting of a four-year effort led by
Britain and the United States, neither of which announced the accord.
Western diplomatic sources said Libya formally agreed to the
compensation package during a meeting with British and U.S. officials in
London on Monday, Middle East Newsline reported. London and Washington were said to have decided to wait
until Tripoli issues an announcement of responsibility.
"After 11 hours of session here in London, we signed an escrow agreement
with the Libyan delegation and the Bank of International Settlements [BIS],"
James Kreindler and Steven Pounian, who represent the families, said in a
statement. "We expect the 2.7 billion will be deposited with the BIS soon
and that Libya will be sending its letter accepting responsibility to the UN
Security Council. When both events occur, we expect the UN Security Council
to enter a resolution lifting the UN sanctions against Libya, which will
trigger the payment of four million [dollars] per case."
Under the resolution, Britain and the United States will work to lift
the UN embargo from Libya. The embargo was imposed in 1992 and
suspended in 1999 after Libya transferred two security agents charged with
the Lockerbie bombing to an international court in the Netherlands.
Such an announcement could take place on Thursday, when Libya was
expected to relay a letter to the Security
Council that identifies Abdel Basset Ali Megrahi as a Libyan agent.
The letter, approved by London and Washington, would not refer to Libyan
ruler Moammar Khaddafy. Saad Djebbar, a London-based lawyer familiar with
the case, told the Financial Times newspaper on Thursday that Britain and
Washington had assured Libya that any admission of responsibility for
Lockerbie would not result in additional legal action against Khaddafy or
The diplomatic sources said that once the Libyan letter is submitted
Britain and the United States would respond with a determination that
Tripoli has fulfilled the terms of the UN sanctions resolution. The council
could then meet as early as next week to lift the sanctions.
In 2001, Ali Megrahi was convicted by a Scottish court in the
Netherlands in 2001 for his role in the bombing. A second alleged Libyan
agent was cleared.
The sources said Libya would deposit the $2.7 billion in several stages
into an escrow account at the Basel-based BIS. The first Libyan payment of
$4 million would be relayed once UN sanctions are lifted.
An additional $4 million per victim would be deposited once the United States ends
sanctions against Tripoli. But U.S. officials said they expect a vigorous
debate within the Bush administration over this issue.
The remaining $2 million per case would be paid when Libya is removed from the
State Department list of terrorist sponsors. The timetable for the U.S.
steps is eight months from the deposit of the $2.7 billion in the escrow
France, a permanent member of the Security Council, could delay the
implementation of the deal. The sources said France wants Libya to increase
compensation for the victims of a 1989 bombing of a French passenger jet in
which 170 people were killed. A French court determined that Libya was
behind the bombing and the family of each victim received up to $30,000.