Indonesia and East Timor announced plans for a historic joint commission to draw a line under past hostilities and resolve the 1999 bloodshed that marred the East Timorese march to independence.

They said the initiative could make redundant plans by UN Secretary General Kofi Annan for a committee to see if justice was served over attacks by the Indonesian army and its militia allies that left 1,000 people dead.

Indonesian Foreign Minister Hasan Wirayuda and his East Timorese counterpart Jose Ramos-Horta told reporters they had unveiled the plan, crafted by their respective presidents, in a meeting here with Annan on Tuesday.

"This is an unprecedented initiative in international relations. There has never been any such initiative involving two countries," Ramos-Horta said in a joint press appearance with Wirayuda.

"We would hope [and] intend that this initiative would resolve once and for all the pending issues, one being the violent events of 1999," he said.

Militiamen, aided by Indonesian soldiers, waged a campaign of intimidation and revenge before and after a UN-organised vote in August 1999 which saw East Timor choose overwhelmingly to split from Indonesia.

The decision to create the Commission on Truth and Friendship was made when new Indonesian President Susilo Bambang Yudhoyono and East Timor President Xanana Gusmao met in Bali on December 14, the ministers said.

Wirayuda said it was "meant as an alternative to the idea of establishing a commission of experts by the secretary general." The ministers said Annan had not indicated if he would go ahead with his own plans for a commission.

"He might consider [his plans] redundant but if he decides to go ahead we will have to study the terms of reference," Ramos-Horta said. The ministers appealed for international help in establishing the commission as their countries move to improve relations and put their recent bloody separation behind them.

East Timor, which won full autonomy in 2002, has downplayed trials in Indonesia, where convictions over the killings have been quashed, and instead stressed the importance of building good relations with Jakarta.

The trials were criticised from the outset, chiefly for their failure to try General Wiranto, who was in charge of Indonesia's military at the time of the bloodshed.

Indonesia invaded the half-island nation in December 1975, shortly after Dili declared independence from centuries of Portuguese colonial rule.