FIFA general secretary Jerome Valcke was strongly criticised in Brazil after saying a project to reform the Morumbi - owned by the club - did not meet the standards set by the world body for matches in the tournament's latter stages.
However, Valcke said the two sides had now ironed out their differences.
"The latest information about the saga between FIFA and Sao Paulo is that the latest project fulfilled all our requirements," Valcke told reporters.
"It's seems there is a clear understanding on what we are looking for."
"It's nothing against Sao Paulo, we weren't saying that the Morumbi can't host the semi-final," Valcke told reporters.
"We're not asking them to make changes for the sake of it. If they want to have a semi-final, they need a given number of seats, a given number of television positions and details."
"It was never a financial issue, it was more to do with the renovation of the stadium and up to now we were not happy with it.
"The final plans are in line with what we have been working on and asking them to do."
HUGE JOB
Brazil was elected unopposed in 2007 to host the tournament which was earmarked for South America by FIFA under a short-lived rotation system.
The country faces a huge job to improve its creaking stadiums and transport system while soaring urban crime is another major worry.
FIFA said they were not aware of any problems arising from an oil reform amendment approved by the lower house of Brazil's Congress, which could cut Rio de Janeiro's share of oil revenues if approved.
Rio de Janeiro state governor Sergio Cabral cried in front of cameras last week, saying the amendment would "break" Rio and that people could forget the World Cup in 2014 and the Olympics if the reform passed in its current form.
Valcke said it was not an issue even though Rio's Maracana stadium is one of the tournament's showpiece venues.
"With regards to the Maracana, the last report is in line with what we've been working on with the local organising committee and we never entered discussion over guarantees," he said.
"Commercial sales are higher than where we were at the same time with 2010 hosts South Africa, we have finalised a number of commercial agreements which are amazing.
"There is no concern from FIFA's side today on the 2014 World Cup."
