St Paul's Cathedral is suspending its legal action against a protest camp outside the church.A cathedral spokesman said it intended to "engage directly and constructively" with the protesters "without the threat of forcible eviction".
The City of London Corporation said it plans to continue with its pledge to issue eviction letters to the group.
Occupy London Stock Exchange protester Sam Chase described the church's announcement as "wonderful news".
The cathedral authorities said they had made the decision after a meeting with the Bishop of London, Dr Richard Chartres.
The bishop has been in charge of the cathedral's response to the camp following the resignation of the Dean of St Paul's, the Right Reverend Graeme Knowles, on Monday.
Members of the Chapter of St Paul's also met with representatives from the camp on Tuesday morning.
'Corporate greed' Dr Chartres said: "The alarm bells are ringing all over the world. St Paul's has now heard that call.
"Today's decision means that the doors are most emphatically open to engage with matters concerning not only those encamped around the cathedral but millions of others in this country and around the globe."
On Friday, the cathedral and corporation had announced they would try to obtain separate High Court injunctions to clear the 200-tent camp.
The cathedral said it recognised the right of the Corporation of London to take legal action against the protest.
Corporation officials have been discussing the details of the eviction notice at a meeting in the Guildhall in the City.
A spokeswoman said the local authority was not opposed to the right to protest but did not want a "campsite" in the City.
"We have never asked protesters to leave, we have only asked them to move their tents," she said.
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End Quote Sam Chase Occupy London protesterA disobedient attitude to capitalism is needed”
The Occupy London camp has been outside the cathedral since 15 October. People taking part have said they are protesting against inequality and corporate greed in the City.The church decided to close last week on health and safety grounds as a result of the camp but partly reopened on Friday.
Mr Chase, 48, a protester from Shepherd's Bush, said: "The move by St Paul's was a wonderful development.
"There are some people in the cathedral who have stood up for what they believe in.
"A disobedient attitude to capitalism is needed."
Meanwhile, the cathedral said it had also asked investment banker Ken Costa to head a group looking to reconnect "the financial with the ethical".
Mr Costa, the former chairman of UBS Europe, would work with City, Church, public figures and the former Canon Chancellor Giles Fraser, who would aim to represent the views of the protesters.
Dr Fraser, who has been sympathetic to protesters, resigned from the cathedral last week.
It is thought differences over the handling of the protest prompted Dr Fraser's decision, the BBC's religious affairs correspondent Robert Pigott said.
taken from http://www.bbc.co.uk/news/uk-england-15541127