For the first time since the International Atomic Energy Agency began in February 2003 an investigation of Iran's nuclear program, the IAEA's board of governors did not adopt either a formal statement or resolution on the matter at what are regular meetings at the agency's headquarters in Vienna.

Diplomats said this was at least in part because the initiative has passed to talks taking place between the European Union and Iran to get Tehran to abandon uranium enrichment in return for trade and security benefits.

The United States has until now taken a more confrontational approach, trying to get the IAEA to bring Iran before the UN Security Council for possible sanctions.

EU-Iran talks resume in Geneva next week, with Washington possibly ready to sign on to the European initiative by helping the EU offer credible bonuses, such as helping Tehran join the World Trade Organization (WTO) or modernize its civil aviation fleet.

At the board meeting, however, the United States and the EU both criticized Iran for late reporting on sensitive issues and failing to give IAEA inspectors the access they needed to crucial places.

US ambassador Jackie Sanders told the 35-nation board that Iran had continued to deny IAEA inspectors "the transparency and cooperation they need to perform their duties" and that Tehran was "cynically" manipulating "the nuclear nonproliferation regime in the pursuit of nuclear weapons."

Sanders, who is based in Geneva but headed the US delegation here, said on Wednesday that "there remain an alarming number of unresolved questions about Iran's nuclear program."

Among them are why the Islamic Republic is building a nuclear reactor that can make weapons-grade plutonium and why Iran was late in reporting on construction of "deep tunnels for storage of nuclear material" at a site that carries out the first stages of uranium enrichment.

Diplomats told AFP Thursday that the concrete foundatioin was already being poured for the heavy-water reactor at Arak, southwest of Tehran.

Enrichment uses centrifuges to refine out what can be reactor fuel but also the explosive core of atom bombs.

Sanders said the IAEA cannot put off "forever" bringing Iran before the Security Council, something the United States has been seeking for almost two years as it says Tehran is in clear violation of the nuclear Non-Proliferation Treaty (NPT).

Diplomats said this may come up at the next IAEA board meeting in June if the European initiative falters.

Britain, France and Germany, which lead the EU talks and have convinced Iran to agree to a temporary enrichment suspension, joined in the US worry over Iranian failures to report fully, telling the board that "Iran has carried out operations of cleaning and quality control on certain centrifuge components, which has caused us serious concern."

The European trio said they understood the suspension "as a voluntary commitment to suspend all, meaning each and every, enrichment related activity, without exception. We urge Iran to keep to this voluntary commitment."

Iran says its suspension is temporary since the NPT gives it the right to exploit the nuclear fuel cycle for peaceful purposes and that it has corrected all reporting failures.

In Tehran, a senior Iranian nuclear official said Thursday that Washington was easing its stance and coming around to supporting Europe's diplomatic efforts to settle the dispute.

"We can clearly detect a turning point in the policy of the Americans," Hossein Mussavian, spokesman for Iran's nuclear negotiating team, told state television.

A senior US State Department official said the United States had promised an early answer to new European proposals for persuading Iran to renounce suspect nuclear activities.

The United States, which had initially kept a distance from the negotiations between the so-called EU-3 and Iran, signalled Monday it was now studying ways of boosting its support.

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