London (CNN Business) Officials from France and the United States have reached a compromise on a new French tax on services provided by large internet companies, potentially defusing the threat of a trade conflict between the two countries.

Under the terms of the agreement, France would repay companies the difference between its digital tax and whatever taxes come from a planned mechanism being drawn up by the Organization for Economic Cooperation and Development (OECD), a spokesperson for France's Finance Ministry told CNN Monday.

"We have reached a very good agreement," French President Emmanuel Macron said at a joint press conference with US President Donald Trump at the G7 summit in Biarritz, France on Monday. "These large multinational players that don't pay taxes, that leads to significant instability on the economic front that is not fair."

Macron said his preference is for international rules for taxing digital services. If and when that happens, he said, "France will do away with its national tax."

Last month, France approved a new 3% tax on the revenue that bigger tech companies generate from their digital businesses, such as by collecting vast amounts of user data and selling targeted advertising. The digital services tax only applies to companies which earn more than €25 million (around $27.7 million) in France, or €750 million (around $830 million) worldwide.

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