The European-bloc’s decision has been welcomed by the British government and cattle farmers and is in response to a consumer health scare over the threat of bird flu.
Britain has made "great strides in tackling this disease and has met all of the criteria that were set for the lifting of the beef export ban," said EU Health and Consumer Protection Commissioner Markos Kyprianou.
"We must now acknowledge this and resume normal trade in this area," Mr Kyprianou said.
The decision to lift the ban was backed Wednesday by the EU's Standing Committee on the Food Chain and Animal Health, which comprises experts from EU member states.
The European Parliament has a month to consider the plans to lift the ban and then the European Commission, the EU's executive arm, has two weeks to formally adopt them.
British response
British authorities and farmers immediately hailed the decision.
"This is excellent news for the British beef industry," said Environment Secretary Margaret Beckett. A government spokesman said: "We know our beef is as safe as any produced elsewhere in the European Union."
In a bid to restore faith in the British beef among foreign consumers, the National Farmers Union (NFU) is expected to mount a major promotion campaign on the continent.
"This is the most positive news for the British beef industry in a decade. We can now look forward to recapturing the UK£675 million (A$1.6 billion) market that was lost when the ban was put in place," said NFU President Peter Kendall.
Mad Cow history
In March 1996 at the height of the mad cow crisis, the EU slapped a total ban on exports of British live cattle. It followed reports from London that discovered a link with a variant new form of Creutzfeldt-Jakob disease (vCJD) in humans as being connected with eating beef tainted with bovine spongiform encephalopathy (BSE).
The epidemic was first identified in 1986 and about 185,000 BSE cases have been confirmed in Britain since then. More than 150 cases of vCJD have been reported around the world, including 140 in Britain.
According to EU figures, cases of BSE in Britain dropped from a peak of 32,280 in 1992 to 165 last year.
Reservations from French, German, Italian and Spanish authorities have largely been responsible for prolonging the ten-year-long ban.
Once plans get the official go ahead, Britain will be able to export live cattle born after 1 August 1996, and bovine meat and products produced after 15 June 2005, in line with other EU states.
The madcow decision comes as the EU is grappling with a growing crisis over avian influenza that has spread into the heart of Europe.