Hopes for a settlement of the dispute between the European Commission and Boeing rose sharply yesterday after the US company offered to drop the exclusivity clauses in supply deals it has signed with three US airlines. Boeing's last-minute concession could pave the way for the European Commission to approve the planned merger between Boeing and McDonnell Douglas and avert a transatlantic trade war.

But the controversial deal still faces opposition from some inside the Brussels executive which will be asked by Mr Karel Van Miert, the competition commissioner, to endorse the deal today.

There were signs the two French commissioners, under pressure from the French government and Airbus, will oppose the Boeing offer.

The climate of negotiations was transformed yesterday when Boeing sent a fax to Mr Van Miert. It came as political leaders on both sides of the Atlantic sought frantically to prevent the Commission from outlawing the merged company in Europe - a move which would have triggered quick retaliation from the US. President Clinton said Boeing had offered a "good faith" resolution to the deadlock. "Our main concern is that only the anti-trust considerations play a role in the position, and we do everything we can to avoid a more political decision which would lead to an unfortunate trade conflict between the US and Europe."

Mr Van Miert took the opportunity of a meeting of foreign ministers in Brussels to outline the content of the Boeing offer to the 15 EU governments.

The offer by Boeing to scrap the exclusivity clauses of 20-year supply deals signed with American, Continental and Delta airlines, met the last of three critical competition concerns set out by Mr Van Miert during his five-month investigation of the tie-up.

He had rejected Boeing's earlier offer to cut the length of the deals to 13 years.

Boeing's refusal to improve its concessions prompted a preliminary decision from Mr Van Miert to ban the merger - a move which would have allowed the Commission to impose fines of up to 10 per cent of Boeing's revenues. The completed offer from Boeing will be put to the 20 Commissioners today at their regular meeting. Mr Van Miert needs only a majority of the Commission to win the vote. - (Financial Times Service)