U.S. Ambassador James Gadsden had asked the country last week to withdraw its offer because Fischer is wanted in the United States on criminal charges on charges of violating international sanctions against Yugoslavia for playing chess there in 1992.

But on Monday, Foreign Secretary David Oddsson invited Gadsden to a meeting and told the U.S. ambassador that the Icelandic government stood by its offer, Icelandic officials said.

Gadsden was told that Iceland wanted to recognize its historic connection with Fischer, who has been held in great esteem here since winning the chess World Championship in Reykjavik in 1972.

Oddsson also told Gadsden that Fischer's alleged U.S. crime had exceeded Iceland's statute of limitations, and for that reason Iceland would not be bound by a U.S. extradition request if the chess player moved to Iceland from Japan.

"Nothing has been withdrawn," said Gunnar Smari Gunnarsson, Iceland's permanent secretary of state in an interview Tuesday. "It is now up to the Japanese government. We are not pressing the matter, but if Fischer comes here, he will be let into the country."

Fischer, 61, is being held in detention in Japan, where he was caught trying to board a flight for the Philippines with an invalid passport in July after the United States had revoked his passport. It remained unclear if Fischer would be released by Japan.

Fischer, who has said he would like to move to Iceland, is fighting a deportation order to the United States.

Japanese officials have said he could go to a third country only if the United States refuses to take him.

The 1992 match in Yugoslavia was against Boris Spassky and was a rematch of the 1972 match that propelled Fischer to stardom.

Fischer, who has baffled the public with his reclusiveness and odd behavior, has applied while in detention to marry a Japanese chess official. His fiance, Miyoko Watai, refused to comment on the marriage plans but said she would like to go to Iceland.

Retired police officer Saemundur Palsson, a Fischer friend since 1972, is hoping to leave for Japan soon to bring him and his girlfriend back to Iceland. Palsson had hoped to leave Tuesday but was waiting for Japan to say whether Fischer would be allowed to leave.