A new airline passenger information sharing agreement between the EU and the United States aimed at thwarting terrorism will likely go into effect by July following concessions from both sides this week.

Envoys from the European Union's 27 nations reached a "basic political understanding" on the new deal, which was struck Wednesday by EU and U.S. negotiators, the diplomats said Friday.

The diplomats said less data on passengers would be exchanged under the new agreement, but the U.S. would be able to hold the information for longer.

Washington has pushed for more information, saying it is needed to help fight terrorism.

"We'll try to finish this by August. Some countries have reserved the right to study the ins and outs of the deal," an EU ambassador said on condition of anonymity because of the sensitivity of the issue.

The agreement would replace an interim deal that expires at the end of July. Failure to strike a deal by then risked chaos. Washington warned that airlines failing to share passenger data under its anti-terror screening rules faced the loss of landing rights and fines of up to $6,000 (4,450 euros) per passenger.

Differences on how to balance security and passenger privacy led to protracted negotiations after a 2004 deal on data sharing was voided last year on technical reasons by an EU court.

Under the new deal struck Wednesday by German Interior Minister Wolfgang Schaeuble, EU Justice Commission Franco Frattini and U.S. Homeland Security Secretary Michael Chertoff, the number of pieces of information transferred to U.S. authorities will be reduced from 34 to 19.

Those recorded data pieces — such as passenger names, addresses, seat numbers and credit card and travel details — are transferred to U.S. authorities within 15 minutes of a flight's departure for the United States under Washington's anti-terror screening rules.

Data can be kept for a maximum of 15 years, but after the first seven years it will become "dormant" and can only be accessed on a case-by-case basis under strict rules.

Particularly sensitive data — defined as anything that could reveal a passenger's race or religion, political views or sexual preferences — would automatically be filtered by the U.S. and deleted. The only exception would be when the data in question "could save the life of the passenger or somebody else's," diplomats said.

The EU's top data protection official expressed concern over the agreement, saying it will put privacy of EU citizens at risk.

"I have serious doubts whether the outcome of these negotiations will be fully compatible with European fundamental rights," European Data Protection Supervisor Peter Hustinx said in a letter to Schaeuble.

He said that under the new deal, data on passengers will be readily accessible to a broad range of U.S. agencies, with no limitations on what the U.S. is allowed to do with the information.

The current agreement allows the U.S. Customs and Border Protection agency to disclose so-called Passenger Name Records to other U.S. law enforcement agencies for use in anti-terror investigations if those agencies have data protection standards comparable to the EU's legal demands.

National parliaments of some EU member states still want to clarify which U.S. agencies will have access to data under the new deal.