EU governments have given final approval to a deal that will allow European trawlers to catch fish along Morocco's Atlantic coast.
Sweden opposed the deal, because the coastal waters of Western Sahara - invaded by Moroccan forces in 1975 - are included in the package.
The EU paid 144m euros (£125m) for 119 trawlers to fish in the rich Moroccan waters for four years.
Small boats from Spain, Portugal and France will be the main beneficiaries.
However, some fishing by larger boats from northern Europe will also be permitted.
"Western Sahara is not part of the territory of Morocco under international law and a process is under way to find a just, lasting and mutually accepted political solution to the conflict," the Swedish EU delegation said in a statement.
The Reuters news agency said Finland, Ireland and the Netherlands gave Sweden some support, but did not vote against the deal.
The European Parliament approved it last week, after amendments designed to exclude the coast of Western Sahara were voted down.
UK Fisheries Minister Ben Bradshaw said the deal would have to be closely monitored to ensure that the benefits of the deal accrued to all the people of the region, including the people of Western Sahara.
International opinion over Western Sahara is divided.
The United Nations views it as a disputed territory; the African Union recognises its independence.
The UN-backed peace plan includes a referendum on self-determination for the Sahrawi people, but Morocco has refused to accept any loss of control over the area.
Morocco occupies the major part of its neighbouring country, Western Sahara. Entering into business deals with Moroccan companies or authorities in the occupied territories gives an impression of political legitimacy to the occupation. It also gives job opportunities to Moroccan settlers and income to the Moroccan government. Western Sahara Resource Watch demands foreign companies leave Western Sahara until a solution to the conflict is found.
It's not easy keeping up with all the different legal proceedings relating to Western Sahara. For the sake of clarity, here's an overview of the five different cases at the Court of Justice of the European Union.
Leading activists from Western Sahara are condemned to sentences ranging from 20 years to life imprisonment in connection to a mass protest in 2010 denouncing the Saharawi people’s social and economic marginalization in their occupied land; the Gdeim Izik protest camp.
At COP22, beware of what you read about Morocco’s renewable energy efforts. An increasing part of the projects take place in the occupied territory of Western Sahara and is used for mineral plunder, new WSRW report documents.