Libya has signed a deal agreeing to pay $35m in compensation to more than 150 non-US victims of a 1986 bomb attack on a discotheque in Berlin, Germany.
Three people were killed in the 1986 bombing
The deal, agreed last month, was signed by the son of Libyan leader Muammar Gaddafi and a team of German lawyers.
It removes one of the last obstacles to Libya's international rehabilitation, after years of being accused by western governments of sponsoring terrorism.
However, the deal does not compensate the US victims of the bomb attack.
Libya has said it will pay for them until Washington compensates it for the lives and property lost in air strikes which the US launched in retaliation for the disco attack.
The attack on the La Belle disco - a nightspot frequented by US army personnel based in the-then West Germany - left three people dead and at least 230 injured.
April 1999: Libya hands over suspects in bombing of Pan Am flight over Lockerbie
January 2002: The US and Libya reveal they are in talks to improve relations
August 2003: Relatives of Lockerbie victims agree $2.7bn payout from Libya; Tripoli takes responsibility for the bombing
September 2003: UN Security Council votes to lift sanctions
December 2003: Libya announces it will halt programmes to develop weapons of mass destruction
December 2003: UN nuclear inspectors begin checks
January 2004: Relatives of 170 victims of the bombing of a French airliner in 1989 sign a $170m payout deal with Libya
September 2004: Libya agrees to pay $35m to 150 non-US victims of the 1986 Berlin disco bomb
Two of those killed were US soldiers; the third was a Turkish woman.
Washington welcomed news of the compensation deal last month but said its victims must also be compensated.
In 2001, a German court ruled that the Libyan secret service was responsible for the bomb attack.
Three former employees of the Libyan embassy in east Berlin and the wife of one of them were convicted of carrying out the bombing by a German court.
After the deal was agreed in August, Germany said it was ready to help modernise the Libyan economy.
Libya's efforts to end its pariah status began a year ago, when Tripoli formally accepted responsibility for the 1988 Lockerbie plane bombing and agreed to pay $2.7bn to families of the victims.
Col Gaddafi's government has since made further efforts to mend ties with the West, including a $170m payout to relatives of 170 victims of the bombing of a French UTA airliner over the Sahara in 1989.