The group kicked off with a working session in a seafront hotel on the island of Ischia on how to deal with the fallout from the collapse of the IS in its stronghold in Raqa.
Italian Interior Minister Marco Minniti warned last week that fighters planning revenge attacks on Europe following the decisive Islamic State group defeat could hitch lifts back to Europe on migrant boats from Libya.
The "technical understanding" signed by Minniti and Elaine Duke, acting US Homeland Security Secretary, aims "to ascertain whether (migrants, asylum seekers or refugees) are noted criminal suspects or terrorists", Minniti's office said.
Earlier, EU President Donald Tusk promised the bloc would fork out more funds to help shut down the perilous crossing from Libya to Italy -- a popular path for migrants who hope to journey on to Europe.
The bloc would offer "stronger support for Italy's work with the Libyan authorities", and there was "a real chance of closing the central Mediterranean route", he said.
The numbers of migrant departures from the crisis-hit country have dropped 20 percent so far this year.
Italy said Wednesday the G7 group would also be working on how to go about "de-radicalising" citizens returning from the IS frontline, to prevent them becoming security risks in jails.
France said there would be negotiations on tackling the legal headache of prosecuting returnees, with questions over what sort of evidence, collected by whom, could be used in a domestic court.
The Group of Seven --- Britain, Canada, France, Germany, Italy, Japan and the US -- dedicated their second working session to the hot issue of terrorism online, with analysts warning IS's loss of territory will turn street-to-street fighting into an intelligence war.
In a G7 first, representatives from Internet giants Google, Microsoft, Facebook and Twitter also took part as the interior ministers want the tech giants to go further and faster in identifying extremism.
Home Secretary Amber Rudd, who was on Ischia, has also suggested those accessing and viewing extremist material on the web should face up to 15 years behind bars.
But Julian Richards, security specialist at BUCSIS (Buckingham University Centre for Security and Intelligence Studies), said he expected "a lot of fine words... but perhaps not many concrete policy proposals" from the G7 team.
"The UK's fairly hard approach of introducing legislative measures to try to force companies to cooperate... and suggestions that people radicalising online should have longer sentences, are often considered rather unpalatable and too politically sensitive in many other advanced countries," he said.
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