In a move likely to strain Poland's relations with both Jews and the Polish diaspora, a parliamentary committee has voted to exclude anyone who is not currently both a Polish citizen and a resident of the country from receiving compensation for property seized by Communist authorities after World War II.

Poland is alone among East European countries in not passing a law on the return of private property that was nationalized after 1945. Restitution bills failed in Parliament in 1991 and 1993.

Late last year, the Solidarity-led coalition government proposed a law that would compensate people who were Polish citizens at the time their property was seized--a group that would include tens of thousands of Polish Jews and Roman Catholics who fled to the United States, Canada, Western Europe and Israel after the war.

But a parliamentary committee, including members from Solidarity, this week amended the proposed law, limiting the right to recover nationalized property or obtain any financial compensation to current Polish citizens who have lived in the country for the past five years.

It raises the prospect of a third failure in 10 years to deal with restitution, complicating Poland's negotiations to join the European Union and roiling Poland's relations with the Jewish community and the United States, which is monitoring the issue closely because it affects a large number of U.S. citizens.

"I'm afraid that Poland's image will be harmed by this," Deputy Treasury Minister Krzysztof Laszkiewicz said of the amendment.

Poland has been under increasing pressure to sort out property claims, with the European Union tying the issue to Poland's application for EU membership and American and British Jews filing class-action suits in the United States to force the return of property. The EU said international law requires Poland to recognize the property rights of both former citizens and Poles living abroad. Poland hopes to join the EU in 2003.

The government had proposed a broad, complicated package that would return property or partially compensate claimants with government bonds or shares in privatized enterprises. It vowed this week to fight for its original, more inclusive draft.

But it is unclear whether the government's bill can muster a parliamentary majority if a rump element within Solidarity joins the former Communist Party and the Peasant's Party to vote it down. At the same time, a majority of Solidarity and its coalition partner, Freedom Union, is unlikely to support the amended bill.

"The amendment is fundamentally an anti-American act aimed directly against Polish Americans and Jewish Americans," said Elan Steinberg, executive director of the World Jewish Congress. "Citizenship and residency requirements are anti-democratic actions. This is a stain on the burgeoning democracy that is Poland."

The Polish-American Congress also said it was angry about the amendment.

According to the Polish treasury department, the Communist government nationalized or seized nearly $50 billion worth of property after 1945, and the government estimates that it faces at least 170,000 claims from former owners or their descendants. The government's original proposal would have allowed the heirs of Polish citizens to file claims, but only in Polish courts--a move designed to preempt class-action suits filed in other countries.

Jewish groups also have argued that any restitution bill should extend back to 1939 to exclude the possibility that someone who was given property by the Nazis and subsequently lost it to the Communists would have a stronger legal claim than the prewar owner.

The proposed law as it stands, however, would compensate individuals only if they could prove that the Communist government violated its own nationalization laws in postwar Poland when it seized property--a provision that is more liberal than it might appear because the Communists paid little attention to their own laws.