OSCE Minsk Group's Proposals
Step-by-step agreement, December 1997
After the failure of the negotiations in the summer and the autumn of 1997 to land a comprehensive agreement, the Minsk Group mediator propsed a new plan which would instead be applied in different phases. The new plan corresponded mainly to the previously proposed package agreement, with the following differences:
- Gradual withdrawal of the armed forces in different phases and the deployment of peacekeeping forces to ensure that the full demilitarization of the region would not be abused by either side in a surprise attack;
- The Latchin corridor would remain under the control of Nagorno-Karabakh armed forces;
- Establishment of a joint commission between Armenia and Azerbaijan to resolve the final status of Nagorno-Karabakh and the remaining issues, such as the status of Latchin, Shushi and Shahumian. 
These conditions also came to be accepted by Armenia and Azerbaijan, while the government of Karabakh rejected the proposal because it left some of the most fundamental questions unanswered, namely Karabakh's status and the question of the Latchin corridor connecting Karabakh with Armenia to the indefinite future.
107) Minsk Group Proposal ('step-by-step deal'), Conciliation Resources; http://www.cr.org/our-work/accord/nagorny-karabakh/keytexts19.php