The Swiss cabinet has suspended its decision to allow the sale of 180 personnel carriers to the United Arab Emirates, from where they were destined for Iraq.
That means that the controversial sale of the used vehicles remains in the balance, awaiting guarantees that they are to be used for civilian purposes only.
At its weekly meeting in Bern, the government reviewed its earlier position at the request of the economics ministry, which is responsible for the sale.
Government spokesman Oswald Sigg said the ministry wanted the State Secretariat for Economic Affairs (Seco) to clarify some issues concerning the necessity of the sale and the use of the tanks.
Economics Minister Joseph Deiss indicated on August 16 that the delivery would not be made without guarantees on the use of the tanks in Iraq.
At that time, Deiss called on Seco to make certain that the personnel carriers would be used exclusively by police services, for the protection of borders and for transporting materials.
The majority of a parliamentary committee accepted Deiss's point of view and voted not to stop the sale by 13 votes to ten, with two abstentions.
Final authorisation is still lacking after the July attacks on London triggered new fears and fanned the debate regarding Swiss neutrality.
The Basler Zeitung newspaper had earlier reported that the tanks would not be used in the police force, as originally intended, but would instead be used in the Iraqi army tank division, at the alleged request of the United States.
The government approved the export on June 29 but has yet to issue a legally binding export certificate, the economics ministry said last month.
It said that after it became known that the United Arab Emirates would hand the 180 armoured personnel carriers over to the Iraqi government as a gift, a so-called end-user declaration was required, formally acknowledging that this was the case.
The Iraqi government must now confirm that the tanks are indeed bound for Iraq.
The government-owned Ruag armaments group, which is selling the tanks, is required to submit an end-user declaration to Seco.
Seco said the US, as the personnel carriers' country of manufacture, must confirm that it approves the deal.
The Social Democratic Party interpreted the government's initial approval as a complete turnaround in its war material policy, while the Swiss People's Party felt that Switzerland's neutrality was at threat.
The Christian Democratic Party and the Radicals supported the cabinet decision.
swissinfo with agencies
At the end of June the Swiss government approved the sale of 180 M113 armoured personnel carriers to Iraq via the United Arab Emirates for SFr12 million ($9.48 million).
The moved caused some unrest among the public and one newspaper reported that the future use of the personnel carriers was not clear.
According to Swiss law on war material, the country receiving the tanks must first provide guarantees before the delivery can be authorised.