France has won another three weeks to clarify how it intends to respect EU budget rules after winning the latest bout of a long-running tussle with the European Commission.

France allied with its fellow euro-zone heavyweight Germany to fend off pressure from the European Union's executive arm at a meeting of finance ministers late Monday.

The ministers from the 12-nation euro zone rejected the Commission's demands for immediate action to bring France to heel, deferring a decision on French violation of the rules until their next meeting on November 24-25.

French Finance Minister Francis Mer promised his partners he would unveil "credible efforts" between now and the next meeting to get his country's deficit under the limit of 3.0 percent of gross domestic product (GDP) by 2005.

The postponement was backed by all the euro-zone countries except Austria, Finland and the Netherlands, which have striven hard to get their books in order and do not see why France should get preferential treatment.

The delay could intensify debate on the credibility of the EU's Stability and Growth Pact, which France as well as Germany is on course to flout for the third year running next year.

EU officials, however, put a brave face on the decision, which was a political defeat for Economic and Monetary Affairs Commissioner Pedro Solbes and the smaller member states.

"We believe these suggestions made by Mr Mer are very much in the spirit of cooperation and therefore very much in the spirit and the letter of the pact," said Italian Economy Minister Giulio Tremonti, who chaired the talks.

Solbes said that "on the basis of the discussion, it's necessary to wait for the final French position".

"In this regard, as always, the Commission is prepared to have a more comprehensive debate on the French case at the next Council meeting," the Spanish official said.

Mer did not spell out what measures he intends to take to comply with the 1997 pact, which -- at Germany's insistence -- prescribed the deficit ceiling in a bid to protect the credibility of the euro.

But officials have said France is looking at healthcare reforms and cancelling one of the country's 11 public holidays, in a bid to cap welfare spending and maximise revenues.

If enacted by the finance ministers, the Commission recommendations would effectively put France under Solbes' guidance until its brings its deficit back under the 3.0 percent ceiling.

Germany, which would be next in the firing line, fought with France to fight off this humiliating outcome, urging other member states to allow the two countries to voluntarily mend their finances at their own pace.

However, the Commission is standing firm in its view that the next step, if France fails to comply with the recommendations, could be multi-billion-euro sanctions of up to 0.5 percent of GDP.

Belgian Finance Minister Didier Reynders said France had only won a temporary reprieve.

"The first part of the crisis has been avoided, the principle has been settled," he told France Inter radio.

"But for now there are only a certain number of commitments in principle. The other chapter, that of the intensity of measures to be proposed, must still be resolved," he said.

In other topics, the EU finance ministers were Tuesday discussing a "transparency directive" that would require European companies to issue earnings reports every quarter.

The measure is opposed notably by Britain, which argues the directive is an unnecessary extra burden on European enterprise.