The European Union and Ukraine agreed Friday to delay a key part of an "association agreement" that has deeply upset Russia in exchange for Moscow holding off on threatened retaliatory trade measures.

The three-way deal averts a potential confrontation that could have erupted on Nov. 1, when the EU-Ukraine deal was set to take effect. European officials hope the delay also provides a breathing space for the two sides to de-escalate their military standoff in eastern Ukraine.

Under Friday's agreement, the Ukrainian and European parliaments will still ratify the association agreement next week, as planned. And the EU will continue its relaxed trade rules on goods coming from Ukraine, as agreed.

But Ukraine will delay its own lowering of tariffs for European goods until the end of 2015. That move had been of great concern to Russia, which complained that a flood of European goods would flow from Ukraine into Russia.

EU Trade Commissioner Karel De Gucht announced the delay after meeting with Pavlo Klimkin, Ukraine's foreign minister, and Alexei Ulyukayev, Russia's economic development minister. Mr. De Gucht acknowledged that giving Russia a say over what was supposed to be a two-way trade deal between the EU and Ukraine might set a bad precedent.

"The world is made of bad precedents," he added.

Mr. De Gucht said that given the volatile tensions between Russia, Ukraine and Europe, a calming step like this makes sense.

"It's a very complicated situation. It's a war situation," Mr. De Gucht said. "If this can contribute to calming down the pressure, it's a good thing."

A 14-month delay, he added, "is not the end of the world."

Russian officials had threatened that if the association deal took effect on Nov. 1, they would downgrade Russia's preferential trade relationship with Ukraine. Under Friday's agreement, Russia agreed to keep that trade regime as it is.

EU officials hope that the delay provides time for the three sides to agree on terms that would allow the association agreement to be fully implemented, and that by then the military tensions will subside as well.

A joint statement issued by the three ministers said in part, "This ongoing process needs to be part and parcel of a comprehensive peace process in Ukraine, respecting the right of Ukraine to decide on its destiny as well as its territorial integrity."

Friday's deal requires the approval of the European Parliament and the European Council, made up of the heads of EU nations. Mr. De Gucht appeared optimistic that would happen. "This is the most rational approach for the time being," he said.

Ukrainian President Petro Poroshenko signed the association agreement with the EU in June. Both sides hailed it as a major step in drawing Ukraine closer to Europe, and Mr. Poroshenko called it "maybe the most important day for my country after independence day."

The association agreement aims to lower tariffs on much of the trade between EU and Ukraine, in exchange for steps by Ukrainian firms to meet EU rules and standards.

Moscow has strenuously objected to the deal from the outset, saying it would damage both the Ukrainian and Russian economies by forcing companies in those countries to meet EU standards. EU officials insist the deal will be good for all concerned, including Russia.

But Moscow views the association deal as a symbol that Ukraine, with which it has historic and cultural ties, is leaving the Russian sphere of influence and moving closer to Western Europe.

The refusal of former Ukrainian President Viktor Yanukovych, under pressure from Russia, to sign the EU association agreement last year sparked weeks of street protests and led to Mr. Yanukovych's ouster.

The Wall Street Journal