Updated

Australia and Indonesia have reached an agreement that will heal a bilateral rift sparked last November by accusations that Australia had tapped the cell phones of the Indonesian president, his wife and eight Indonesian ministers and officials in 2009, an official said on Tuesday.

Foreign Minister Julie Bishop said that she will fly to Jakarta soon to sign the code of conduct that Indonesia had insisted upon before diplomatic relations are normalized.

"We have reached agreement on the joint understanding and we are currently arranging a time to sign it," Bishop said in a statement.

Indonesia's outgoing President Susilo Bambang Yudhoyono downgraded the bilateral relationship and withdrew his ambassador from Australia in protest at media reports of phone-tapping allegations from National Security Agency leaker Edward Snowden.

Relations have been gradually proving since then, and Indonesian ambassador Nadjib Riphat Kesoema returned to Canberra in May.

Bishop has not released details of the pact, which will also be signed by her Indonesian counterpart Marty Natalegawa.

The Australian newspaper reported that the agreement will be called the Joint Understanding of a Code of Conduct and will stand as an annex to the Lombok Treaty on mutual security signed between the countries in 2006.