The United States and the EU have agreed on technical standards for Europe's planned Galileo satellite navigation system, which had drawn concerns from the Pentagon, negotiators from both sides said.

After years of often tense talks over a multibillion-dollar system the United States suspected would interfere with military signals, the agreement ends a trans-Atlantic spat in time for a formal signing ceremony at an EU-US summit on Saturday.

The final accord, which was agreed in principle in February and formalized with legal documents over the weekend, avoids disrupting US military frequencies and still provides the European system with sufficient accuracy, the negotiators said.

Washington offered to share its satellite know-how, acquired in developing its Global Positioning System for navigation, and the Europeans changed their preferred radio frequency to limit potential interference with a coded military signal.

The sides want Galileo and GPS to mesh seamlessly for the benefit of manufacturers and service providers as well as for consumers, who increasingly use GPS for cars and yachts.

Any harmonisation pact could uncork vast private-sector investments in the so-called Open Service of Europe's planned 30-satellite Galileo system, which is scheduled to begin operations in 2008.

The European Commission forecasts that Galileo would spin off more than 100,000 jobs and generate service and equipment contracts worth more than $10 billion a year, making it the continent's most lucrative infrastructure project.

To break a talks deadlock earlier this year, the commission ditched its frequency choice and accepted the US preference known as Binary Offset Carrier (BOC) 1.1, the negotiators, who asked not to be named, said.

But a European negotiator held out the hope that the agreement could eventually be adapted.

"We retained the possibility for flexibility in the future and to be able to fine-tune that signal as we proceed," he said. "The proof of the pudding will be in the eating, and as we eat, we will be able to hopefully add the ingredients we need and hopefully make it a little tastier," he said.