Iraq?s US-appointed Governing Council put aside its differences and agreed on an interim constitution on Monday, a key step in Washington?s plan to hand sovereignty back to Iraqis by June 30.

?Early this morning the Governing Council unanimously approved the Transitional Administrative Law after weeks of intensive discussions,? the Council said in a statement. The document will be officially signed on Wednesday.

The 25-member Council had previously missed a February 28 deadline to strike a deal due to divisions over the role of Islam, quotas for women in government and Kurdish demands for autonomy in northern Iraq.

Officials said the law recognised Islam as Iraq?s official religion and said it would be a source ? but not the sole source ? of legislation. Shi?ites in the Governing Council had wanted Islamic law to be given precedence in family affairs.

?Islam will be the official religion of the state and it will be a source...of legislation. Also the law will say to respect Islam as the religion of the majority,? Governing Council spokesman Hameed Kefaey told the BBC.

?Federalism also has been approved as a form of government,? Kefaey said, adding details of the agreement would be announced on Wednesday.

The constitution is due to provide a framework for an interim government set to take power on June 30 from the US-led administration in Baghdad.

The Council brings together leaders from Iraq?s various ethnic and religious groups, including Shi?ite and Sunni Arabs, Kurds and Turkmens.

During discussions on Friday, several Shi?ite members of the Council walked out, angered by the cancellation of a previous ruling that would have made divorce and inheritance subject to the rulings of religious law.

Other sticking points had included defining the role of women in a future government, with some Council members pushing for the constitution to set out a specific quota for the number of female representatives or parliamentarians.

There had also been furious debate over federalism, with the Kurds, who have effectively had self-rule in three northern provinces of Iraq since the 1991 Gulf War, pushing to enshrine that autonomy in the document.

Wednesday?s signing ceremony will follow the celebration of an important Islamic festival Ashura, marking the martyrdom 1,300 years ago of Hussein, a grandson of the Prophet Mohammad.

Officials said the negotiations were spirited and at times heated, but always respectful. With US presidential elections nearing, President George W. Bush?s administration says it is determined to stick to plans to hand sovereignty back to Iraqis on June 30. But the mechanism for selecting the interim government has yet to be agreed.

Top Shi?ite cleric Ayatollah Ali al-Sistani has rejected a US proposal that the transitional body be chosen by regional committees. However, he has eased his demand for early elections since the United Nations joined Washington in saying polls were impractical before the end of June because Iraq has no electoral registers or laws.

Wary of sectarian and ethnic tensions in Iraq, Washington wants to ensure all groups are represented in the interim body. But Shi?ites, oppressed for decades by the mainly Sunni government of Saddam Hussein, hope their majority status will ensure they have the greatest clout in the new Iraq.

Joseph Logan