The growth of GM crops has sparked many protests

The laws allow new GM foods to be sold in Europe for the first time in five years, but only if they are clearly labelled.

The EU's long moratorium has angered the United States and other GM crop-growing nations, which say they have been deprived of a huge export market in Europe.

They filed a suit with the World Trade Organization last month arguing for the moratorium to be lifted as it was an unfair trade barrier.

I believe we have got in place legislation... to enable consumers to make the choice for themselves whether to consume GM foods or not David Byrne Consumer Affairs Commissioner

However, it is thought the US may not cancel the action, as it regards the GM labelling system as likely to deter customers. Small and medium-sized businesses also complain about the extra bureaucracy involved.

However, opposing critics of the new laws say they don't go far enough, allowing products containing small but detectable amounts of GM contents to go unlabelled.

The new rules have already been approved in principle by EU governments, and could now become law by the autumn.

In a separate part of the package of measures, each EU country can, if it wishes, impose restrictions on the way GM crops are grown to ensure there is no cross-contamination with conventional crops.

Anti-GM politicians and activist groups had called for the EU to keep the ban and reject US pressure.

But pro-GM groups said the EU would miss out on economic and scientific benefits if it extended the moratorium any further.

Tougher measures

Europe's Consumer Affairs Commissioner, David Byrne, told the European Parliament: "We have now come to the stage where we must lift the de facto moratorium.

"I believe we have got in place legislation... to enable consumers to make the choice for themselves whether to consume GM foods or not," he said.

Under the new law, all foods with more than 0.9% genetically modified content will have to be labelled.

There had been some calls for the threshold to be set lower, at 0.5%, but parliament backed the 0.9% level which had already won the backing of European ministers.

Tighter rules

The legislation also includes animal feed - previously exempt from labelling rules.

Labels will have to read: "This product is produced from GMOs."

A stipulation in the new rules that any product derived from GM ingredients but whose presence is undetectable - such as cooking oil - should still be labelled as genetically modified has dismayed biotech firms.

They fear such tough labelling and traceability rules will hit sales in Europe.