At talks in Brussels, the leaders approved a proposal to satisfy a last-minute demand by the deeply eurosceptic Czech President Vaclav Klaus for his country to win an opt-out from the EU's charter of fundamental rights.

"I am happy to say that the European Council this evening has been able to take a decision and agree on what has been asked for by the Czech government and the Czech president," said Swedish Prime Minister Fredrik Reinfeldt.

"The road to ratification stands open," said Reinfeldt, whose country holds the EU's rotating presidency, adding that the compromise will have no impact on the Czech Republic's neighbours.

The Czech Republic is the only one of the 27 EU nations that has not ratified the treaty.

"We have moved the last political obstacle to ratification," said European Commission President Jose Manuel Barroso, after a summit working dinner.

Klaus angered his EU partners when he sought an opt-out from the treaty three weeks ago, after Prague's parliament had already ratified it, in what his critics took as a fresh attempt to delay its adoption.

The move was to ensure the treaty will not allow ethnic Germans forced out of the former Czechoslovakia after World War II for Nazi collaboration to reclaim their property.

According to a European diplomat, the opt-out follows the same form as that accorded to Britain and Poland, whereby a protocol will be tacked on to a future EU treaty, probably when a new country joins.

The last technical obstacle remains a court appeal against the treaty by a group of Czech parliamentarians, many from the party Klaus founded. The Czech Constitutional Court is set to rule on it on November 3.

Czech Prime Minister Jan Fischer, who attended the summit, welcomed the agreement and said it paved the way for ratification in his country once the court has handed down its verdict.

"There will be nothing to prevent a fast completion of the ratification," he said. "The Czech Republic will ratify the treaty so that it could take effect by the end of the year."

A French diplomat, meanwhile, said the leaders would "reaffirm their determination to the see the Lisbon Treaty take effect by the end of the year," in a post-summit statement.

With the Czech problem out of the way, attention has also turned to candidates to become the first EU president, with former British premier Tony Blair a front-runner, along with Luxembourg Prime Minister Jean-Claude Juncker.

"We Britain, are supporting Tony Blair," British Prime Minister Gordon Brown said.

While no decisions on the new top job are expected, the leaders could reveal their level of ambition for the post if Blair, a charismatic and savvy orator, is dropped for a lesser light playing a more administrative role.

Leaders from Belgium, Hungary, Luxembourg and Spain suggested they would not back Blair, whose country is neither in the euro currency group nor the Schengen no-borders zone.

Other candidates include former Latvia president Vaira Vike-Freiberga, and ex-Irish premier John Bruton.

In the end, Reinfeldt said there was no point discussing names until all 27 nations had ratified the treaty.

Given the stalemate, he had insisted it was best to focus on the main topic of climate change, as the leaders seek agreement on how to share the costs of the battle against global warming.

Here too consensus has proved difficult, with less wealthy central and eastern European nations reluctant to stump up at the same rate as France, Germany and Italy to help the developing world -- and that trio reluctant to commit to hard figures.

Main points of the EU's Lisbon Treaty
The European Union's wide-ranging Lisbon Treaty, which moved closer to ratification Thursday, is aimed at updating and revitalising the bloc's institutions and replacing its failed constitution.

Eurosceptics see it as a major step towards a federal Europe.

The treaty, signed in the Portuguese capital on December 13, 2007 by EU governments, needs to be ratified by all the 27 member states before coming into force.

On November 3, the Czech Constitutional Court is due to rule on an appeal against it, and should the complaint be rejected, staunchly eurosceptic Czech President Vaclav Klaus is expected to put his signature to the text.

Klaus won guarantees Thursday from EU leaders for his last-minute demand for a Czech opt-out of the charter of fundamental rights attached to the treaty, similar to those granted to Britain and Poland.

Here are some of the main aspects of the treaty:

A treaty not a constitution:

An attempt to give the European Union its first constitution, which would have replaced the EU's key treaties -- the 1957 Treaty of Rome and the treaties of Maastricht (1992), Amsterdam (1996) and Nice (2000) -- was foiled in 2005 when Dutch and French voters rejected the idea in national referendums.

The new "Reform Treaty" will complement and amend its predecessors, not replace them.

New rights for EU citizens:

The treaty makes binding the EU's Charter of Fundamental Rights, though Britain and Poland have obtained opt-outs, and the Czechs appear likely to have the same guarantee.

A million European citizens will be able to "invite" the European Commission to submit a legislative proposal in a given area.

New policies:

The treaty introduces new objectives such as a common energy policy and strategy on fighting global warming.

On trade policy, fair competition becomes a requirement to assure the proper functioning of the internal market.

On security matters, a "solidarity" clause is introduced in the case of terrorist attacks. A member state which falls victim to an attack or other disaster will receive assistance from other member states, if requested.

Institutions, posts:

In place of the rotating presidency, under which member states spend six months at the helm, a president of the European Council (which comprises the 27 member nations) will be elected by the leaders to a two-and-a-half-year term.

The president will prepare summits and represent the EU on the world stage without, it is hoped, treading on the toes of a new "High Representative for Foreign Affairs and Security Policy".

This foreign policy post will combine the roles of the current EU High Representative for the Common Foreign and Security Policy (Javier Solana) and the Commissioner for External Relations (Benita Ferrero-Waldner)

The commission -- the EU's unelected executive arm -- will from 2014 cut the number of policy commissioners in order to increase efficiency.

The treaty also increases the number of policy areas where elected members of the European Parliament have to approve EU legislation, along with the member states, particularly in the sensitive areas of justice, security and immigration.

National parliaments will be given a voice in EU lawmaking for the first time. Each will receive proposals for new EU legislation directly to judge whether a proposal impinges on its competencies.

Voting systems:

The areas of decision-making which can be approved through majority voting, rather than unanimity, will be increased, largely in justice and police affairs.

Britain and Ireland have secured the power to apply decisions in these areas as they wish, but may not hold back their EU partners.

The treaty also introduces a new voting system. Under the new "double majority" qualified voting system, a minimum of 55 percent of member states (currently 15 of 27 countries) representing at least 65 percent of the EU's population must vote in favour of new legislation for it to be passed.

Get-out clause:

The treaty introduces the possibility for a country to leave the European Union under conditions to be negotiated with its partners.

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