The compromise is designed to break a deadlock in talks among EU countries on draft EU rules to allow them to decide individually whether to grow or ban GM cultivation, which have made little headway since being proposed by the European Commission in 2010.
"We are working on it. There is a blocking minority on the GMO proposals, and we are trying to do our utmost to find a solution and get agreement among member states," said a spokesman for the Danish EU presidency, who declined to comment on the details of the compromise.
Under the plan, companies seeking EU approval for a GM crop would agree not to market the product in those countries that wish to restrict cultivation, in return for them not blocking EU authorisation to grow the crops elsewhere in Europe, the draft seen by Reuters showed.
"Any decision [to ban cultivation] shall be communicated to the notifier with the aim of reaching an agreement on the grounds upon which the concerned member state has based its decision," it said.
One EU biotech industry source said companies had yet to agree a joint position on the proposal, but that any progress towards approving new GM crops for cultivation in Europe was welcome.
"This is probably the last serious attempt to unblock the negotiations on the cultivation proposal," said the source, who declined to be identified.
In January, German biotech firm BASF Plant Science announced that it was moving its plant biotech research activities from Germany to the United States and would cease all work to develop GM crops specifically for the EU market.
It is unclear whether the Danish compromise will be enough to overcome opposition to the Commission's proposal from countries including France, which has said it wants to tighten the EU's risk assessment of GM crops before discussing the plans.
Other countries, including Spain and Germany, have raised concerns that the proposals would fragment the EU's single market by banning farmers in some EU countries from growing GM crops, while allowing others to press ahead.
Britain, meanwhile, is unlikely to support a proposal in the Danish compromise to allow countries to ban cultivation on environmental grounds, for example to prevent the emergence of herbicide-resistant weeds - a move backed by EU lawmakers.