UNITED NATIONS -- France, Russia and Germany signaled Thursday that a new U.S. draft resolution on Iraq did not meet their demands, and Secretary-General Kofi Annan said it did not follow his recommendation for a quick transfer of power to an interim Iraqi government.

But the revised resolution won support from close U.S. ally Britain, which signed on as a co-sponsor, and a sympathetic response from Bulgaria and Spain.

The revised resolution endorses a step-by-step transfer of authority to an Iraqi interim administration but sets no timetable for the handover of sovereignty and leaves the U.S.-led Coalition Provisional Authority in overall control until elections are held at some future unspecified date.

"Obviously, it's not going in the direction I had recommended, but I will still have to study it further," Annan said Thursday.

He later told the 15 Security Council ambassadors at a private lunch that the United Nations could not participate properly because the resolution blurred the roles of the world body and the coalition, council diplomats said on condition of anonymity.

Either the coalition or the United Nations should lead the process, Annan told the members. However, he said the best solution would be to quickly install a provisional Iraqi government because that would enable the world body to directly help Iraqis with drafting a constitution and preparing for elections, the diplomats said.

According to U.N. diplomats, Annan has said this would make it easier politically for other countries to contribute troops and money because they would not have to deal with the current U.S.-British occupation authorities.

France, Germany and Russia -- which opposed the U.S.-led war on Iraq -- have joined Annan in calling for a quick transfer of sovereignty to Iraqis, with French Foreign Minister Dominique de Villepin saying it could be done by year's end.

The issues of when to transfer sovereignty and the U.N.'s role in postwar Iraq dominated Thursday's first Security Council discussion.

U.S. Ambassador John Negroponte has said he wants a new resolution approved before an international donors conference for Iraq is held in Spain on Oct. 23 to 24 -- but initial reactions indicated serious differences.

The new resolution would authorize the United Nations and the U.S.-led coalition to assist the U.S.-appointed Iraqi Governing Council in preparing a constitution and holding elections, and encourage Annan to consider assisting Iraq in reforming the judiciary and civil service and training an Iraqi police force.

Though the new U.S. draft does not set a timeline, it does encourage the Iraqis to act quickly. Secretary of State Colin Powell said last week he envisions the process of drafting a new Iraqi constitution to take six months.

At the closed Security Council meeting, France's U.N. Ambassador Jean-Marc de La Sabliere said the resolution did not meet Paris' expectations to give the United Nations a central role and put the Iraqis in control of their future political system, a French diplomat said on condition of anonymity.

Germany's U.N. Ambassador Gunter Pleuger said he asked Negroponte where in the new draft were the amendments that France and Germany jointly proposed calling for a quick transfer of sovereignty because on first perusal it was "somewhat difficult" to find that they had been addressed. Germany hopes for an answer when the council holds further discussions on Monday afternoon, he said.

France raised similar questions and called for greater "transparency" in the handling of money for Iraq's reconstruction, the French diplomat said.

Russia's U.N. Ambassador Sergey Lavrov said his government was still studying the draft but Moscow's position was very clear.

"We believe that at this stage we should give the United Nations the leading role in the political process, to work with all Iraqis, to develop a timetable which would be clear, which would be leading to the full restoration of sovereignty, and that this process would be supported by a multinational force," he said. "Against this position we would be looking at the American draft."

Annan said he recommended quickly setting up an interim Iraqi government, which would assume power in a few months with the aim of hopefully changing "the dynamics on the ground," improving the security situation and sending a message to the Iraqi people and the region.

The international community would not walk away, he said.

"But at least Iraqis will be responsible, and they will be the government, and going through transition with support of the international community. And you get rid of the idea that it is an occupation and cut back on the resistance."

Annan has said handing over sovereignty quickly would enable the Iraqis to take more time to write a constitution, noting that the United Nations has found that the process has taken up to two years in other countries, the diplomats said on condition of anonymity.

The revised U.S. draft also calls for a strengthened U.N. role in Iraq, but it does not give the United Nations the primary role sought by Russia, France and other countries to oversee Iraq's political transition to a democratic state.

"Obviously, it's not going in the direction I had recommended, but I will still have to study it further," Annan said Thursday.