Liechtenstein has established diplomatic relations with the Czech Republic, the principality said today, marking a first step towards resolving a decades-long land dispute.

"It is an anomaly in Europe to have two states which have no diplomatic ties. Today we have come to realise that the first step to normalising relations is to establish diplomatic ties," Liechtenstein government spokesman Max Hohenberg told AFP.

"We will then examine to what extent we can or cannot resolve outstanding issues."

Liechtenstein used to have a recognized diplomatic representation in the former Czechoslovakia through the Swiss mission in Prague in 1938.

However, following the Second World War, communist-ruled Czechoslovakia didn't recognise Liechtenstein as a sovereign state, and annexed properties in the regions of Bohemia, Moravia and Silesia that Liechtenstein's royal family claimed to own.

Czechoslovakia split into the Czech Republic and Slovakia in 1993.

Monday's agreement also included a plan to set up a historical commission to examine the "joint history of Bohemia, Moravia, Silesia and the House of Liechtenstein, as well as the relationship between the two countries throughout the 20th century."

"Liechtenstein and the Czech Republic are of the view that relations between both states can be developed on the basis of this shared inheritance and joint European values, and that this can also enable the different positions which sprung up over the course of an eventful history to be overcome," said Liechtenstein in a statement.