He said Saddam and others would eventually face trial as war criminals before a special Iraqi tribunal set up last year.
"We understand the importance of transferring the high-value detainees to the Iraqi interim government upon their request, which we anticipate will be received shortly after July 1," the official in Iraq's US-led administration said.
"Because the Iraqi interim government is not currently in a position to safeguard these detainees, at least in large numbers, our current plan calls for the transfer of legal responsibility over a certain number of high-profile detainees...while physical custody will remain with the multinational force in Iraq," he told reporters.
Saddam Hussein was arrested
on 13 December, 2003
The official, who asked not to be named, confirmed that Saddam would be among the first group to be legally handed over to the interim government after the US-led occupation formally ends on 30 June. It had not been decided how many others would be transferred in the same way.
Red Cross criticised
A meeting between Saddam Hussein's defence lawyers and Red Cross representatives ended Monday, with an exchange of threats and accusations.
The defence team asked the Red Cross to secure a meeting with Saddam, but the officials argued that their organisation does not enjoy the privilege of forcing an occupation force to arrange such a meeting.
The war of words has been escalating between the defence committee and the Red Cross.
The lawyers have accused the Red Cross of not doing enough to guarantee Saddam Hussein his legal rights, such as meeting his lawyers.
Defence lawyers also failed to get a promise from the Red Cross to provide regular information about Saddam Hussein's detention place and state of health.
Ziad al-Khasaouna who headed the defence lawyers at the meeting said the meeting was a complete failure.
"The Red Cross wants us to remain silent, because we shall need its services in the future" al-Khasaouna said "We refuse this offer, and I would like to say that despite the world's respect for this organisation, it is weak and dominated by US policies regarding Iraq's issues."
Hussein Hatim Shaheen, lawyer of Raghad Saddam Hussein attended the meeting and says the Red Cross is negligent.
"There is obvious neglect from the Red Cross side. That is clear through its failure in arranging a meeting with Saddam Hussein and securing adequate protection for the Iraqi prisoners in Abu Ghraib prison" Shaheen said.
Red Cross officials said the campaign that Saddam's lawyers are launching, will disrupt the organisation's work, and prevent it from providing its services to the detainee and his lawyers.
The officials stressed that Saddam Hussein is alive and in good health. They said doctors from the organisation had visited him three times.
They revealed that the US occupation authorities are holding three letters written by Saddam Hussein, for inspection purposes.