'Strong words' have been exchanged between the Taoiseach Mr Kenny and French president Nicolas Sarkozy over the issue of corporate tax.

The French government is understood to be pressing for Ireland to be flexible on the question of a common corporate tax base in exchange for flexibility on the terms of our bail out.

The Taoiseach Enda Kenny had arrived at the EU Summit in Brussels where leaders had been discussing the crisis in the eurozone.

Earlier, Mr Kenny told reporters that he had a very strong mandate from the Irish people to improve the EU-IMF deal and would be laying out the reasons why to his fellow EU leaders.

Having made renegotiation of the bailout a key electoral promise, Mr Kenny has encountered first hand the extent to which some of his eurozone partners, notably the countries that underwrite the bailout, are reluctant to relax its terms.

There are a number of ideas on how the burden of the bailout could be relaxed for Ireland, and what the Government may have to commit to in return.

However, they are more likely to be agreed at the formal summit of EU leaders at the end of this month.

Finnish Prime Minister Mari Kiviniemi has told RTÉ News that Finland was ready to negotiate some details of Ireland's rescue package terms, but said Ireland would have to offer something in return.

‘It is difficult to make any changes to the contract, but of course when we look at the comprehensive package Finland is ready to negotiate some details, but Ireland will also have to make new commitments,’ she said before today’s summit.

Mrs Kiviniemi refused to go into detail when asked if those commitments included Ireland's corporate tax system.

A memo from the Finnish ministerial council on EU affairs to the parliament has acknowledged that Finland would support a lower interest rate for Ireland.

Eurozone agrees on pact

Euro zone leaders have agreed to write limits on public debt and budget deficits into national law, meeting a German condition for a stronger euro zone financial safety net.

They also moved closer to agreeing a comprehensive package of measures that they hope will draw a line under the year-long debt crisis.

The deficit agreement, which will be formally approved at a summit in two weeks, once other elements of the euro zone's response to the debt crisis are in place, also envisages higher retirement ages, wage growth in line with productivity gains and bank resolution schemes.

Germany, which has limits on debt written into its constitution, wants other euro zone members to agree to some national limits to avoid a repeat of the sovereign debt crisis, sparked by years of unchecked overspending in Greece.

Libya on summit's agenda

Mr Kenny will join a summit of 26 other EU leaders at which the crisis in Libya will be discussed.

British Prime Minister David Cameron and French President Nicolas Sarkozy wrote to their EU partners yesterday urging them to unite in calling for Libyan leader Muammar Gaddafi to give up power immediately.

A draft declaration for approval at the Summit also calls on Libya to 'rapidly embark on an orderly transition to democracy'.

German Chancellor Angela Merkel wants Gaddafi to step down right away and said she does not consider him a valid interlocutor for discussing the future of his country.

Mr Cameron and Mr Sarkozy went into the talks urging partners to extend formal recognition to Libya's opposition, while working on contingency planning for military action.

'We are going to step up today measures in the European Council (summit) to put pressure on that regime, measures to isolate that regime,' Mr Cameron said.

'We should also plan for every eventuality,' he said. 'This is absolutely vital.'