The US Department of State notified the Blackwater private company in writing it will not renew the contract with the firm to protect Iraq, media reported.
The negotiation with the paramilitary firm expires in May, and the Washington resolution followed a recent decision from the Iraqi government that announced the dismissal of the mercenary entity.
According to official spokespeople, the administration of President Barack Obama cannot simply reactivate the Blackwater license if that measure contravenes Iraqi authorities decisions.
The Department of State stated the measure against the security company does not affect other Blackwater contracts to protect the US diplomatic staff in other parts of the world.
Blackwater is one of the three private security firms working in Iraq, in addition to Triple Canopy and DynCorp International. It benefits from a $2-billion accord granted by Washington.
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Blackwater mercenaries receive $300 per day or more and the company bills Washington over $1,200 per day for each "contractor". In the past, this work was done by US Marines at a cost of less than $100 per day.
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