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WASHINGTON (CP) - U.S. officials didn't apologize Wednesday but said they're investigating a "regrettabSourcele" incident in which soldiers fired at a car carrying four Canadian diplomats in Baghdad.

Canadians are disputing a U.S. version of events, saying a military convoy fired at them without warning, with one bullet coming dangerously close. No one was injured.

"Our officials are clear that they were operating within the rules," prime minister-designate Stephen Harper said in Ottawa.

"Obviously, we'd like to make sure we deal with this and avoid such a situation in the future. We're obviously very glad no one was hurt"

Canada's concerns have been relayed to U.S. authorities by Gen. Rick Hillier, chief of defence staff, said Harper.

U.S. State Department spokesman Sean McCormack said the Pentagon is determined to find out "exactly what happened."

"Nobody, our soldiers and our security personnel, certainly don't want to fire on innocent people, certainly not close friends and allies."

U.S. Defence Secretary Donald Rumsfeld said he didn't know the details of the event Tuesday, involving two convoys in the city's heavily fortified Green Zone.

But a military spokesman in Iraq said Wednesday the U.S. convoy "felt threatened" by a potential suicide-bomb attack after the Canadian vehicle came too close and ignored hand and arm signals to stay back.

"They felt they had to use warning shots," said U.S. Lt.-Col. Barry Johnson, spokesman for the multinational force in Baghdad.

"Clearly, these warning shots weren't aimed at the occupants."

A U.S. military statement said the shots were aimed "at the front of the vehicle, away from the passenger area."

But one unnamed Canadian diplomat riding in the vehicle told CBC News a bullet entered the passenger compartment. She said the vehicle had kept a safe distance from the convoy and no one remembers any warnings from U.S. soldiers before there was a sudden explosion.

The vehicle carried the charge d'affaires to Iraq, Stewart Henderson, and three others plus a driver.

The U.S. convoy had pulled off to the side of the road and was several lanes from the Canadian vehicle behind a waist-high cement barrier when the shots occurred, the diplomat said.

"We are reassured by our team in Baghdad that all appropriate procedures were followed," said Foreign Affairs spokeswoman Marie-Christine Lilkoff.

"We are aware there are conflicting stories."

The vehicle was reported outfitted with Canadian flags.

"I'm not trying to say that in the end it won't be found out that it was obvious that this was a diplomatic convoy," said McCormack.

"But we don't know that now."

The Green Zone includes the headquarters of the U.S. military and houses the Iraqi government and diplomats.

Canada has a small diplomatic presence but plans to establish an embassy this summer after a building in the zone is refurbished.
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