In July, EU ministers gave the European Commission a negotiating mandate, without involving the parliament, to hammer out a deal with the US on the transfer of bank data sent over the Swift network.

This prompted heated debate in Parliament with MEPs raising concerns over privacy and some questioning the legal validity of any deal struck by the EC.

However, "under pressure from MEPs", the parliament says the Council of EU ministers has now agreed to renegotiate the deal next year. This is important because the Lisbon Treaty should be passed by then, meaning Parliament may have a final say on any agreement.

The commitment to a renegotiation is the latest stage of a three year-long controversy surrounding the use of Swift data by the US government.

In 2006 it emerged that the US had been using emergency powers to secretly scrutinise suspect wire transfers sent over the Swift network as part of efforts to trace and cut off terrorist financing.

Swift came under fire from Belgian and European Union officials following disclosure of the programme before the EU struck a deal setting conditions on the access of transaction data by the US in 2007.

EU ambassadors agreed a deal that allowed the US government to access data for counter-terrorism purposes only and to keep any data for a maximum of five years.

Also in 2007, the Swift board approved a four-year EUR150 million systems re-architecture programme designed to allow intra-European data to be stored only in Europe, and thus out of the reach of US authorities.

Now, an interim deal is being negotiated by the EC to give the US access to some data that can be used to fight terrorism but MEPs were furious at not being involved.

"It are unacceptable that once again the European and national parliaments, representing citizens' interest, are bypassed and being denied a transparent and democratic process," says Dutch liberal MEP Sophie In't Veld.

MEPs say they want to ensure data transferred to the US authorities should be processed "only to fight terrorism" and that "storage and use must not be disproportionate" to this objective.

The parliament now seems to have been pacified after Beatrice Ask, the Swedish Justice Minister, said yesterday that the text being negotiated with the US "will not be in force for more than 12 months".

Then, according to Commissioner Jacques Barrot, "an immediate renegotiation will take place under the Treaty of Lisbon", which would give the parliament the final say on the text.