U.S. contractors to lose immunity from Iraqi law

WASHINGTON (Reuters) - Private contractors working for the U.S. government in Iraq will lose their immunity from Iraqi law under a new pact with Baghdad, senior American officials said on Thursday.

The contractors, who provide everything from personal security to meals for U.S. forces and officials in Iraq, were told they should expect to lose their immunity starting January 1, the State and Defense department officials said.

The agreement, which has yet to be approved by Iraq's parliament, allows U.S. forces to stay in Iraq three more years. A vote is expected next week on the pact, which replaces a United Nations mandate that expires at the end of this year.

Iraqis were outraged after guards with U.S.-based Blackwater Worldwide killed 17 people in Baghdad last year with escorting a convoy. Since then, the Baghdad government has demanded that private American security companies and other contractors be made subject to Iraqi justice.

It has not yet been publicly resolved how and where the Blackwater guards will be tried and senior officials said they did not know whether the new pact would apply retroactively.

U.S. officials have said that under the deal, U.S. military personnel would retain immunity from Iraqi law except in cases of serious crimes committed off base.

But the pact explicitly says U.S. Defense Department contractors will lose immunity, said the senior U.S. officials, who spoke on condition of anonymity. They said contractors for the State Department and other agencies are expected to be treated the same way.

Representatives of about 172 companies with operations in Iraq have been briefed on the change.

The companies were read a statement that said: "In the future, contractors and grantees can expect to be fully subject to Iraqi criminal and civil law and to the procedures of the Iraqi judicial system."

None of the U.S. contractors has threatened to quit, the senior Pentagon official said. "I suspect there is a wait and see attitude, to see how this plays out."

About half the 163,000 Pentagon contractors in Iraq were Iraqi nationals, only 17 percent are Americans, and the rest are citizens of third countries.

Many had been doing business with Iraqi commercial companies as well as the U.S. government and were already subject to Iraqi law.

Making government contractors subject to Iraqi law is consistent with the way the United States operates in other countries, the State Department official said.

The United States would seek an understanding with the Iraqi government that personal security contractors should be allowed to use "appropriate defensive force," he added.

There are about 5,500 State Department contractors in Iraq, and 4,800 for the U.S. Agency for International Development.