Yemeni President Ali Abdullah Saleh has accepted the Gulf Cooperation Council mediated initiative.
The plan calls for him to announce his resignation in 30 days, but his ruling party insists that Saleh should be kept as "honorary president" for five months after he transfers power.
The head of the GCC submitted a plan to Yemen's President Ali Abdullah Saleh and the opposition on Thursday for resolving the country's crisis.
The plan proposes Saleh to form a joint national government incorporating all political parties, with Saleh then shifting power to his deputy in exchange for immunity given to him and his family.
The plan calls for Saleh to hand over power within three months. It sets 30 days as the deadline for Saleh to announce his resignation and 60 days for the transitional president and the unity government to hold presidential elections.
The opposition Joint Meeting parties has accepted the plan. But the ruling party insists that they want Saleh to stay as "honorary president" for five months after he transfers power to his deputy.
Yemen has been facing a political crisis ignited by opposition-backed street protests since mid-February. The protesters have been demanding the end of the 33-year rule of Saleh.
The massive demonstrations are still continuing in major provinces, undermining the security and stability of the country.