Ali Abdullah Saleh has pardoned Yemenis who "committed errors during the crisis" that has rocked the country since January and killed hundreds of people, according to state television.
The announcement on Sunday immediately angered groups who say Saleh can no longer take such decisions, having transferred his presidential powers to his deputy under a Gulf Co-operation Council deal to step down in return for immunity from prosecution.
The deal signed, on Wednesday in the Saudi capital, Riyadh, stipulates that Saleh - who has been in power for more than three decades but faced 10 months of massive anti-government protests - must leave power within 90 days.
"The president of the republic has decreed a general amnesty for all those who have committed errors during the crisis," a statement flashed on state television said.
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The reported pardon came as tensions remain high in Yemen, where Saleh returned overnight from Riyadh. Saleh was wounded in the June 3 bomb attack and had to seek treatment in Saudi Arabia.
"This is in violation of the Gulf initiative by which the president delegated his powers to the vice-president," Hurriya Mashhud, a spokesperson for the opposition, told the AFP news agency.
"He no longer has the right, nor the prerogative or the capacity to take such decisions," she said.
The state broadcaster said that the amnesty decided by Saleh "does not include those involved in crime and in the attack against the mosque at the presidential palace compound".
Suspects who are "members of [political] parties, groups or individuals will be brought to trial," the report said.
If the agreement goes according to plan, Saleh will become the fourth Arab ruler brought down by mass demonstrations that have reshaped the political landscape of the Middle East.
This followed a decision on Friday by opposition parties to nominate Mohammed Salem Basindwa, the head of an alliance that led months of protests against Saleh, to form a new government.
"A presidential decree issued today ... mandated ... Basindwa to form a government of national unity," Saba said.
Basindwa, a foreign minister from 1993 to 1994, is to form the new government under the deal signed in Riyadh.
Against this backdrop of political unrest, reports say at least 25 people have been killed and dozens wounded in sectarian violence in northern Yemen.
Shia Muslim opposition forces attacked Sunni Islamist Salafi fighters with bursts of shelling, a Salafi spokesperson said on Sunday, a claim which could not be independently verfied by Al Jazeera.
The shelling, which killed 10 people on Saturday, continued on Sunday afternoon, the Salafi spokesperson said, bringing the death toll to 25 with a further 48 wounded in the latest flare-up in Damaj, about 150km north of the capital, Sanaa.
The conflict in the north, where government troops also tried to crush Shia Houthi fighters before a ceasefire last year, is one of several plaguing Yemen which plans elections next year to replace Saleh.
Dayfallah al-Shami, a member of the Houthis' political office, disputed the Salafi account of the fighting.
He told the Reuters news agency that Abdelmalek al-Houthi, the Houthis' leader, had issued orders for a ceasefire but the Salafis rejected it and fought on.
"We have martyrs and wounded," he said. "We have informed the mediators that the Salafis can have their slogans as long as they refrain from incitement and takfir [denouncing a Muslim as an infidel]."
The clashes followed a protest in the northwestern city of Saada on Friday, in which Shia Muslim protesters voiced their opposition to the GCC initiative, and called for Saleh to be put on trial.
In recent weeks, the Houthis have clashed with Salafi fighters, leading local tribal leaders to declare a truce between them.
It seemed to collapse on Saturday when, according to Abu Ismail Salafi, the Salafi spokesperson, Houthi fighters shelled the town of Damaj.
Members of the Zaidi sect of Shia Islam, the Houthi fighters led an uprising based in the Saada province that Saleh's forces struggled to crush, with Saudi Arabia intervening militarily in 2009 before a ceasefire took hold the next year.
The Houthis, who effectively control Saada, are deeply wary of Saudi Arabia's promotion of puritanical Sunni Salafi creeds that class Shias as heretics.