By Sebastian Alison BRUSSELS, Nov 24 (Reuters) - The United States hopes to reach agreement with the European Union in a dispute over air passenger data by the end of the year, the U.S. ambassador to the EU said on Monday, acknowledging EU concerns on privacy. Washington demanded access to world airlines' booking records to help track suspected terrorists and criminals after the September 11, 2001, attacks on U.S. cities, but the EU is worried this could breach its strict privacy laws. "We feel that hopefully we will come to some sort of an agreement before the end of the year," Rockwell Schnabel told Reuters in an interview, reaffirming a deadline set in September. "We recognise the very important issue of privacy in the European Union, but...at the moment the security aspect is of great importance. We insist on having a very clear idea of who is coming into the United States. That clearly has changed since 9/11...it has changed on a permanent basis," he said. U.S. negotiators have reduced the amount of data they are seeking, removing sensitive items such as which passengers demand special meals, and the period of time they want to store the information, but the gap between the sides remains. Schnabel said it was for the EU's executive Commission to assess whether it felt measures taken by the United States to protect the data were adequate. "We are working on it and actually the negotiations have been moving along and we feel that something will come out of it," he added. EU officials told Reuters on Monday that Internal Markets Commissioner Frits Bolkestein was unlikely to conclude that the current U.S. position offered sufficient safeguards on privacy. But they said when Bolkestein reported to the Commission on the issue on Wednesday, he may propose negotiating a bilateral treaty with the United States which could allow the EU to set aside some of its own privacy rules to allow airlines to comply. The European Parliament has been pressing the Commission to avoid backing down on strict EU data protection laws. Schnabel played down talk that the Bush administration was pursuing a policy "disaggregation" in relations with the EU, seeking closer ties with key member states at the expense of links with the EU as a bloc. "The answer is no. There was disagreement within the EU of how to address the issue of Iraq of course, but we did not promote anything other than dealing with Europe as a unit, and we will continue to do so," he said. "Naturally, we have bilateral relations, and they don't go away," he added, saying the United States had strong links with all 10 states due to join the bloc next May, raising the number of members to 25. "At the same time we recognise that they are now becoming members of the EU, and therefore we deal with them also through the EU." This year marks the 50th anniversary of U.S. ties with the EU and its forerunners, which began when the United States sent observers to the European Coal and Steel Community in 1953. (Additional reporting by Lisa Jucca)
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