The confidential talks, involving diplomats and experts from Britain, France and Germany, as well as Iran, are due to last three days, a diplomatic source close to the talks added.

The new round of meetings is taking place amid Iran's continued rejection of a demand to permanently abandon uranium enrichment, a fuel process which can assist in the functioning of nuclear power stations but also produces material for nuclear weapons.

The United States maintains that Iran is trying to covertly develop nuclear weapons, while Tehran insists that its programme is purely meant to meet civilian energy needs.

The diplomatic source said the first day of talks would focus on political cooperation, with the key nuclear issue only due to be broached on Wednesday and Thursday.

The Europeans have held several meetings with Tehran since December to try to persuade Iran to guarantee that it will dismantle nuclear fuel work in return for technical assistance and economic and political rewards.

The four-party talks this week in Geneva are scheduled to be the last round of technical talks before a meeting of a higher level steering committee at the end of March.

Iran's top nuclear official Hassan Rowhani warned Saturday that his country would never agree to a permanent halt on enriching uranium.

"We cannot have and we will not have negotiations with the Europeans if what they want is an end" to uranium enrichment, Rowhani told reporters in Tehran.

Iran agreed in November to suspend enrichment as a "confidence building measure" to show its intentions are peaceful, but has stressed the halt would be temporary.

Tehran is pressing ahead with work on a heavy water reactor at Arak, which can make weapons-grade plutonium, according to the International Atomic Energy Agency (IAEA).

Another diplomat close to the EU-Iran talks said that the hardline language from Tehran was no different from what the Iranians have been saying for months.

The diplomat said the Europeans "are waiting to see what it really means," in the meetings in Geneva this week.

Iranian nuclear negotiator Hossein Moussavian reiterated Sunday that the Europeans had so far "not shown any seriousness" and that Iran doubted "their capacity" to strike a deal, the Iranian news agency IRNA reported.

Meanwhile, Washington says Iran is "cynically" manipulating a loophole in the Nuclear Non-Proliferation Treaty (NPT), and recently reiterated its threat to take the issue to the UN Security Council to seek international sanctions.

US Secretary of State Condoleezza Rice, warned last week that Tehran had shown "no indication" it was ready to seal a deal.

Rice also reiterated the prospect that Iran could face UN action if it did not show a willingness to cooperate on the matter.

However, German Chancellor Gerhard Schroeder expressed optimism about the outcome of diplomatic pressure on Iran after a meeting with French President Jacques Chirac on Monday.

Schroeder said he had been reassured that a solution could be reached following US President George W. Bush's visit to Europe two weeks ago.

"We are hopeful that, in the negotiations, we will have enough persuasive force to convince the Iranian leadership to adopt a positive position," he said.

Non-proliferation experts believe that Iran may yet cut a deal with the EU, although this may not take place before Iranian presidential elections on June

"In the run-up to the presidential elections, I do not think any of the Iranian officials have any interest in showing any flexibility because they will be strongly criticised for giving away Iran's rights," Gary Samore, from London's International Institute for Strategic Studies, said while in Tehran for a nuclear technology conference.

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