European Union regulators said Saturday that France has promised to avoid protectionist conditions in a billion euro (dollar) rescue package for car makers.

The European Commission said a letter from French Industry Minister Luc Chatel has promised that euro7 billion (US$8.95 billion) in soft loans for PSA Peugeot Citroen and Renault SA would not require them only to invest in French suppliers or car plants located in France.

French President Nicolas Sarkozy angered eastern European states such as the Czech Republic when he hinted that car makers getting large French government subsidies should think of shifting production back to France from low-wage countries.

This prompted Czech Prime Minister Mirek Topolanek to call a summit of all 27 EU leaders on Sunday to get a clear agreement that governments would steer clear of protectionism when they spend heavily on stimulus programs to lift economies out of recession.

EU Competition Commissioner Neelie Kroes said she was satisfied with French guarantees on the car bailout plan, which came after several weeks of talks with French officials.

The commission said it would "of course monitor closely the implementation of this plan."

The EU executive must check large state payments to companies to make sure they don't trigger competition problems by favoring one business or sector over rivals elsewhere in Europe.