"In Brussels in February, there was an accord with the Europeans that we would suspend the assembly of centrifuges and in return they would close our dossier at the IAEA," Khatami told reporters after a cabinet meeting.

"Because they did not do this, we are not bound by the accord."

According to the Iranian account of the February deal, the EU's so-called "big three" promised to help remove Iran's dossier from the top of the International Atomic Energy Agency (IAEA) agenda.

But instead the three co-sponsored a resolution at the UN nuclear watchdog that criticised Iran's failure to fully comply with an IAEA probe into whether Iran is seeking merely atomic energy or nuclear weapons.

The European side, however, says they were explicit in spelling out to Iran that they would only support it at the IAEA if the body's director, Mohamed ElBaradei, was satisfied with Iranian cooperation -- which he was not.

Despite the spat and Iran's announcement it would resume the assembly of centrifuges -- used to enrich uranium in the most sensitive part of the fuel cycle -- Khatami said Iran was still committed to a deal struck last October.

In that accord, Iran agreed to allow tougher IAEA inspections, make a full declaration of its activities and suspend enrichment itself.

"We have suspended enrichment and have not resumed," he said. "We will negotiate with the Europeans and we think we can continue to negotiate with the Europeans."

"All our activities are in the framework of civil and peaceful nuclear technology, and I deny we bought any nuclear material for military purposes," he added.

Iran's top national security body said Tuesday that the next round of talks with Britain, France and Germany on the nuclear issue would resume later this month.

The Supreme National Security Council, which is headed by nuclear negotiator Hassan Rowhani, made no reference to where the talks would be held or, more importantly, at what level and on what specific subjects.

All rights reserved. Copyright 2003 Agence France-Presse. Sections of the information displayed on this page (dispatches, photographs, logos) are protected by intellectual property rights owned by Agence France-Presse. As a consequence, you may not copy, reproduce, modify, transmit, publish, display or in any way commercially exploit any of the content of this section without the prior written consent of Agence France-Presse.

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