U.S. Transfers Political Authority in Iraq

Despite the restrictions on his government, Allawi has promised to use his new authority to take more aggressive actions against insurgents. He said he would announce new security measures later on Monday.

He and some of his cabinet ministers have suggested that a state of emergency could be declared in violence-prone areas, allowing local authorities to impose curfews and ban public demonstrations.

Other than the handful of senior officials participating in the handover ceremony, which was not broadcast live on television, Iraqis had no knowledge of it as it was happening. As Bremer gave Allawi the document, Baghdad residents went about business as usual.

Thirty minutes later, the first news bulletins ricocheted across the capital, startling residents as they saw the news in cafes and office buildings. There was no noticeable celebratory gunfire, which often occurs at commemorative moments in Iraq.

The ceremony occurred in a nondescript room in Allawi's new office. Other than Bremer and Allawi, only four people participated: Yawar, the interim president, Chief Justice Mahdi Mahmoud, Deputy Prime Minister Barham Salih and British envoy David Richmond.

They sat on chairs with gold-colored upholstery as a dozen aides and a score of journalists stood off to the side. "This is a historic, happy day, a day that all Iraq has been looking forward to," said Yawar, a tribal sheik dressed in brown robes who was the first to speak. "It's a day we take our country."

Allawi, who delivered brief remarks in Arabic and English, said his government had been "working very hard to achieve the authority as soon as possible." Allawi, a formerly exiled opposition leader, insisted his administration was "ready to handle the situation, whether it's security or the economy."

Bremer said he felt "a great pleasure to be here today, to formally hand over sovereignty." He said there was "no question the liberation of Iraq was a great and noble thing."

He noted that Allawi's government, with a 33-member cabinet, had assumed control of all of Iraq's ministries over the past few weeks. "You have moved very quickly to assume the authority," Bremer said.

The participants then stood and Bremer opened the blue portfolio to read from the document inside. "The Coalition Provisional Authority will cease to exist on June twenty-eighth," he said. "At that point, the occupation will end."

Bremer said the document was signed by "Paul Bremer, ex-administrator," prompting chuckles from everyone in the room.

Bremer also gave Allawi a letter from Bush asking for formal diplomatic ties with the interim government.

Security was extremely tight. Snipers were stationed on nearby rooftops and U.S. Army helicopters buzzed overhead. The handover, which had been scheduled to occur on June 30, was accelerated after discussions between Bremer and Allawi over the weekend, a senior U.S. official said.

Both men were concerned that insurgent attacks timed to coincide with the handover would mar the ceremony. As the handover has neared, militants have escalated a campaign of car bombings, kidnappings and other violence in an attempt to disrupt the transfer.