The European Union agreed Monday to suspend most of its sanctions against Burma for a year despite a dispute over a parliamentary oath between the army-backed ruling party and pro-democracy leader Aung San Suu Kyi.

In the first clear sign of friction since Suu Kyi’s party swept historic by-elections, the ruling party Monday rejected her demand to replace the words “safeguard the constitution” with “respect the constitution” in the oath.

Suu Kyi and party colleagues refused to take their seats at the opening of parliament, tarnishing the image of political transformation that Burma, also known as Myanmar, hopes to portray to the world.

E.U. foreign ministers decided to suspend sanctions in recognition of democratic reforms after half a century of military rule.

“I don’t think that’s a reason for us to do anything different than what we’re doing,” E.U. foreign policy chief Catherine Ashton said of the dispute over the oath. “But of course we want to see a resolution to that so that in fact they can take their seats.”

One E.U. diplomat said that suspending the sanctions did not imply that Burma was a fully democratic country, and that it was up to the people there to work out problems like the oath.

The suspension, which does not apply to a separate arms embargo, is likely to go into effect this week. It will allow European companies to invest in Burma, which has significant natural resources and borders economic giants China and India.

Brussels had frozen the assets of nearly a thousand companies and institutions and banned almost 500 Burmese from entering the European Union. It also prohibited military-related technical help and banned investment in the mining, timber and precious metals sectors.

The European Union is rewarding a shift that has seen many political prisoners freed and a range of repressive measures lifted in Burma.

“President Thein Sein has taken important steps towards reform in Burma, and it is right for the world to respond to them,” British Prime Minister David Cameron said in a statement. “But those changes are not yet irreversible, which is why it is right to suspend rather than lift sanctions for good.”

British Foreign Secretary William Hague said the suspension of sanctions should lure back some investment in Burma.

— Reuters