The Vatican and Israel have agreed to hold high-level talks in Rome next month, resuming negotiations on thorny administrative issues after five years of a virtual deadlock.
A meeting of top officials on both sides was due to be held last month but it was cancelled at the last minute by Israel, prompting speculation that dialogue had definitively broken down.
According to authoritative sources in the Vatican, the meeting will now take place on May 21, when top officials will look at longstanding disagreements on tax and judicial matters.
Another unresolved issue is the Vatican's request that custody of certain symbolic sites in Israel - such as the room of the Last Supper and an ancient church in Caesaria connected to St Peter - be returned to the Catholic Church.
This question is not expected to be on the agenda on May 21, at a meeting which will last only two or three hours.
Israel's decision to call off the March 28 meeting, citing the international commitments of a key delegation member, produced an official Vatican statement which expressed "regret".
Observers said that, in fact, the Vatican was very irritated. Catholics in Israel were also deeply disappointed by the setback.
Israel and the Holy See, which only forged full diplomatic relations in 1993, have been trying ever since to resolve a series of complicated questions which continue to cause tensions.
A key one is the tax exemption that the Church wants for its property in Israel.
Another is how to deal with cases of Catholic properties which have ended up in Israeli hands. The Vatican wants such problems to be dealt with by local courts.
"It sometimes happens that cemeteries, churches or Catholic lands are occupied by private Israeli citizens. To get them back we can't turn to the local judiciary because we are told that an old decree says such issues must be resolved on a political level," a Vatican source explained.
Everything is left up to "discretion", in a framework where there are "no rules", the source said.
CONCERN OVER MIDEAST.
The talks on administrative issues come against a backdrop of wider Vatican concern over the faltering peace process in the Middle East.
Pope Benedict has frequently urged Israelis and Palestinians to work for lasting peace.
Among other things it is keen on finding a solution for the city of Jerusalem, which is holy to Jews, Muslims and Christians.
In his Easter message, the pope said there were "some signs of hope" in the dialogue between Israel and the Palestinian authority.
Earlier this week Palestinian President Mahmoud Abbas went to the Vatican for meetings with Pope Benedict XVI and Secretary of State Tarcisio Bertone, with whom he discussed the situation in the Mideast.
"We expressed the hope that the initiatives that have emerged in recent weeks and months will bear fruit, even though the events of recent days reveal the problems of the situation," Bertone said.
