BRUSSELS, Belgium – Coca-Cola Co. has agreed to change sales practices that helped it win roughly half of the soft drink market in Europe as part of a settlement of a long-running antitrust investigation by the European Union.

Coke’s biggest rival, PepsiCo Inc., applauded the deal, which was aimed at creating more competition in the $21 billion European soft drink market.

The E.U.’s Competition commissioner, Mario Monti, said that commitments presented personally by Coca-Cola’s chief executive, Neville Isdell, in Brussels were “sufficient for a settlement decision, which will close a five-year probe.”

Coke has roughly half the European market, compared with about 10% for Purchase, N.Y.-based PepsiCo’s Pepsi-Cola unit. In America, Coke’s lead over Pepsi is smaller.

The changes include an end to exclusivity arrangements with stores or restaurants and allowing rival drinks into Coke-branded coolers. The aim, Mr. Monti said, is to let consumers choose what to buy “on the basis of price and personal preferences, rather than pick up a Coca-Cola product because it’s the only one on offer.”

The deal allows Atlanta-based Coke to avoid a fine and potentially years of continued legal wrangling. It would likely take effect in spring, after being translated and published in the E.U.’s Official Journal for a formal consultation period.

In a statement, Mr. Isdell welcomed the deal, saying it “provides clarity” about how E.U. competition rules ap ply to sales practices of Coke and its European bottlers.

“We have always sought to compete fairly in an increasingly competitive European nonalcoholic beverage marketplace,” he said.

PepsiCo, whose complaint against Coke initially sparked the E.U. case, praised it as well. A spokesman, Dick Detwiler, said the deal should increase competition and result in “significant changes” in the European carbonated soft drink market.

A fine could be imposed later if Coke breaches the terms of the settlement. In afternoon trading on the New York Stock Exchange, Coca-Cola shares rose 32 cents to $39.56 while PepsiCo shares gained 14 cents to $49.13.

Under the five-year deal, Coke will scrap all rebates that require retailers to buy the same amount of Coke products or more each time. It also will no longer require that a customer who wants to buy best-selling regular Coke or Fanta Orange also take less-popular brands or offer rebates if they do or reserve shelf space for them.

It will also allow rivals to occupy 20% of the space inside its coolers, if its coolers are the only ones in the store.

Mr. Monti, whose term expires at the end of the month, was harshly criticized in America when he squashed General Electric Co.’s merger plans with Honeywell International in 2001, and again after issuing a sweeping ruling and record fine against Microsoft Corp. this year when settlement talks collapsed.

He said Coca-Cola was “seriously disposed” to reach a deal after the E.U.’s investigation, which included raids at bottlers across Europe in 1999 and 2000 and grew to a 100,000-plus page files.

“It was a difficult path to go down but I think we have now reached the end of it,” Mr. Monti said.