By Jeffrey Ulbrich, Associated Press

LONDON (AP) --- President Clinton struck a deal with European leaders Monday to ease U.S. restrictions on multinational companies doing business with Cuba, Iran and Libya. Republicans back home immediately challenged the agreement.

Under the steps announced by Clinton, the administration would grant permanent waivers to the 1996 Helms-Burton Act, which imposes U.S. sanctions against foreign companies that do business with Cuba. Clinton said he also would seek to ease a section of the law that denies U.S. visas to executives of those companies.

In exchange, members of the 15-nation European Union agreed to join in creating a global registry of property confiscated by Cuba and other governments that would remain off-limits to investors.

A senior Clinton administration official, speaking on the condition of anonymity, said the EU members had agreed "not to upgrade their political or economic relations with Cuba until or unless Cuba improved their human rights and democratic record.''

In Washington, spokesmen for both Sen. Jesse Helms, R-N.C., and Rep. Dan Burton, R-Ind., said the lawmakers were not part of the compromise announced Monday.

"This is way too small a loaf,'' said Helms spokesman Mark Theissen. "It requires an act of Congress. The administration has no power to deliver on changes in the law without an act of Congress. What the EU has offered doesn't even pique interest here on Capitol Hill.''

Although the Helms-Burton Act imposes sanctions on companies that do business with Cuba, it allows Clinton to grant temporary waivers. Under the agreement announced Monday, those waivers would become permanent.

John Williams, a spokesman for Burton, said that the administration had discussed what was under way, but "not with a great amount of detail.'' Burton was not part of the negotiations, he said.

"We are waiting to see a more detailed outline of their proposals,'' Williams said.

The European Union long has been upset with what it sees as American arrogance in trying to impose its domestic legislation on foreign countries. Specific targets of ire are the Helms-Burton Act and a similar law on Iran and Libya.

The Europeans challenged Washington's unilateral sanctions before the World Trade Organization in October 1996, but last spring decided to suspended their case for a year to allow for a negotiated settlement.

"We have avoided a showdown on the sanctions with which we don't agree,'' said British Prime Minister Tony Blair, the current EU president, at the close of the semiannual summit between the United States and the European Union.

Added Clinton: "We have forged a path-breaking common approach to deter investment in illegally expropriated property around the world including, but not limited, to Cuba.''

Clinton also announced that he had decided against imposing sanctions on a consortium led by a French oil company for investing in Iran. Under the Iran and Libya Sanctions Act, the president can impose sanctions on foreign companies that invest $20 million or more a year in Iran's oil and gas sectors.

Iran signed the $3 billion contract last September with a consortium of French, Russian and Malaysian oil companies led by Total, a French oil giant, to expand a gas field estimated to hold 300 trillion cubic feet of gas. The field is in the Persian Gulf adjacent to Qatar.

The senior administration official said the president has the authority under law to waive the provisions of the Iran-Libya law. However, the president will have to seek an amendment of the Helms-Burton law regarding Cuba.

"We are going to work on an expedited basis to draw up the amendment,'' the official said. "We think it will be introduced shortly. We of course can't control the congressional calendar. But the disciplines applying to Cuba, which are very effective we think, do not go into effect until the waiver is passed.''

Sen. Alfonse D'Amato, R-N.Y., sponsor of the Iran-Libya law, called Clinton's decision "a mistake.''

"It will send a signal to others that they can do business as usual with Iran, at a time when Iran continues to pursue weapons of mass destruction and continues to sponsor terrorist acts,'' D'Amato said in a statement.

Both the administration and EU officials stressed that all the details had not been worked out on the Cuba agreement. But Clinton said he believed Congress would be satisfied.

To underscore the easing of trade tensions between the United States and Europe, Clinton and Blair announced enhanced efforts to reach market-opening trade agreements by the year 2000.