Cruise liners could start and end their journeys in Liverpool under proposals which would see the local council paying back around £5 million in Government grants, the Department of Transport said today.
The City of Liverpool Cruise Terminal could be permitted to change the way it operates if plans put forward for consultation by Shipping Minister Mike Penning get the go-ahead.
The terminal, which opened in 2007, was built with the help of cash from the North West Development Agency and the European Regional Development Fund.
But the DoT said there was deemed to be "potential for unfair competition with other UK ports" and operations at the terminal were restricted to cruises calling at the city as part of a longer trip.
The restrictions do not allow for cruises to start and end in the city.
Last month Liverpool City Council put forward proposals for a partial repayment of the public subsidy in return for a lifting of the restrictions.
The proposals put forward by Liverpool City Council include a repayment of £5.3 million spread evenly over 15 years.
The Government is now consulting on a potential way forward based on these proposals.
Shipping Minister Mike Penning said: "Liverpool has a rich maritime heritage spanning many centuries, and I am keen to see that continue.
"However, I have been clear throughout this process that I am equally committed to ensuring fair competition across all UK ports.
"That is why I am pleased that Liverpool City Council have come forward with proposals which recognise this."
A spokesman for Liverpool City Council said: "We welcome the start of consultation over the lifting of restrictions for turnaround facilities in Liverpool. We hope to reach a resolution that satisfies everyone."
The consultation of port operators and other interested parties will be ongoing until September 15.
A final decision on whether to approve Liverpool City Council's application is expected early in the new Parliamentary year.