The Syrian Government and Opposition on Monday began discussing the formation of a transitional government, in what moderators predict will be the most difficult stage of the first talks to end the three—year conflict.

The two sides are expected to negotiate a legal framework for the authority, to be comprised of members of President Bashar al—Assad’s Government, the Opposition and independent figures.

“This commission will oversee the formation of a transitional government, greater separation between legislative, executive and judicial authorities and examine needed constitutional reforms to bring a new democratic age to Syria,” Burhan Ghalioun, a delegate from the opposition told dpa in Geneva.

“What we will be discussing today will set the path for the future of Syria.” Representatives of the government and opposition will address each other directly for the first time since the internationally—backed peace talks opened in the Swiss resort of Montreux on Wednesday.

UN—Arab League envoy to Syria Lakhdar Brahimi is acting as intermediary in the talks at the UN headquarters in Geneva.

The issue of a political transition has been divisive, with Damascus threatening to pull out of the talks over the opposition’s demand to have it as a central point in the negotiations in Geneva.

Damascus is expected to suggest a referendum on a transitional government, sources in Geneva said. Deputy Foreign Minister Feisal al—Meqdad noted Sunday the government was prepared to discuss “everything we believe is in the best interest of the Syrian people.” The opposition will meanwhile reiterate its demand for al—Assad, “his family and any of his criminal associates” to be excluded from a transitional government, delegates told dpa.

The two sides have so far concentrated on the humanitarian situation in Syria and the issue of prisoners held by the government and rebel forces.

Brahimi said opening the talks with the two issues would serve as a “confidence building” measure.

On Sunday, Damascus agreed in talks to allow thousands of women and children to leave the besieged central city of Homs. The UN said it was awaiting clearance for its convoy from the Homs governor.

The government said it wanted to ensure access for international relief agencies before discussing the question of detainees.

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