Foundation hospitals in England are to be exempt from NHS rules banning the poaching of nurses and other medical staff from developing countries, a confidential Department of Health document has revealed.

A draft code of practice seen by the Guardian says foundation trusts will be treated like private hospitals and merely "invited" to adopt ethical recruitment policies, without any sanction if they choose to ignore them. For other NHS organisations - and UK employment agencies that supply them with staff - the rules will be compulsory.

The original code banned all NHS hospitals from advertising vacancies in developing countries unless they were specifically authorised to do so under inter-governmental agreements. No exception was made for foundation hospitals.

But that approach was abandoned in the draft document circulated last week to NHS human resources managers, unions and the private sector, which proposed a ban on "active marketing of posts" in developing countries that have not signed an inter-governmental agreement. .

Foundation trusts were excluded them from the list of NHS organisations required to follow the code, in a further in dication that ministers want to have the same freedoms as the private sector.

The document was withdrawn 24 hours after being circulated by email and a health official requested that all copies should be destroyed. However, the department confirmed last night that the exemption was still intended.

A spokeswoman said: "While we cannot directly mandate foundation trusts on their recruitment policies, we are confident they will show enthusiasm for the new code."

It would be "crazy" for them to attract bad publicity by poaching staff from developing countries, she added.

John Reid, the health secretary, promised in May to strengthen the ethical recruitment code after pressure from the nursing unions. However, he rejected the Royal College of Nursing's demand that the code should be made obligatory in the private sector.