President Clinton, speaking at the end of the Nato summit in Madrid, said he could not accept clauses in the pact that would restrict the authority of the Food and Drug Administration to set nicotine levels in cigarettes.
The statement underlined the fragility of the 20 June pact, under which the tobacco companies agreed to pay out $368bn (pounds 218bn) for compensation payments and for anti-smoking campaigns over 25 years in return for protection from future litigation and for curbs on the FDA's power.
As negotiations on passing the agreement into law get started, it is also becoming clear that the recent turbulence for tobacco stocks is far from over. In London, BAT shares shed 12p at 536.5p.
Negotiating the agreement, the tobacco giants won provisions insisting the FDA should not outlaw nicotine in cigarettes for at least another 12 years. Before attempting to lower levels, the FDA would have to demonstrate it would not create a black-market.
Calling the provision an "unreasonable restriction", the President said he was confident that removing it from the pact would not prompt the tobacco firms to withdraw.Reuse content