France, Britain and Germany, which headed the negotiations with Iran on behalf of the European Union, called on Tehran to reverse course and return to talks on its controversial nuclear programme.

The trio have called an emergency meeting of the United Nations' atomic watchdog, the International Atomic Energy Agency (IAEA), in Vienna Tuesday to discuss the way forward.

French Foreign Minister Philippe Douste-Blazy called for a united response to a crisis that he said was deliberately provoked by Tehran.

"The international community will react and will decide the response to give," he told AFP. "I hope it will be united in the face of this grave crisis deliberately provoked by Iran."

The minister said French officials had received a letter from Tehran giving a negative answer to a package of EU incentives offered in exchange for Iran suspending nuclear work that could be used to build weapons.

The tone of the letter was "particularly alarming," Douste-Blazy said, adding that it was "contrary to the spirit of the negotiations we have held with Iran over the past two years.

The IAEA confirmed Monday that Iran had begun the first stage of uranium ore conversion, an initial step in the nuclear fuel cycle, triggering "regret" and "concern" in Britain, which holds the presidency of the European Union.

Uranium conversion produces a gas that is the feedstock for enriching uranium into fuel for civilian nuclear power plants. In highly refined form, it can be the raw material for atomic bombs.

"We regret Iran's decision to reject the E3's (Britain, France and Germany's) proposals and are deeply concerned about reports that Iran has also decided to restart," said Ian Pearson, a Foreign Office minister.

"We will discuss next steps in the International Atomic Energy Agency board of governors tomorrow," he said.

Britain has been working with its two fellow European heavyweights diplomatically to stop Iran from developing nuclear weapons.

"The E3's proposals represent a serious attempt to find a way forward that would benefit Iran and the international community," said Pearson.

"Iran's decision to reject them without discussion is damaging," he added.

Earlier, a Foreign Office official declined to speculate on the outcome of the IAEA meeting.

"However, our position is well known," the official told AFP.

"Were Iran to resume any part of its uranium enrichment-related activities, including the uranium conversion facility at Isfahan, this would be a breach of the Paris agreement which they signed on November 15, 2004 as well as IAEA board of governors resolutions," the official said.

The three European countries has previously warned that if Tehran breaks the agreement reached last year to suspend work on the nuclear fuel cycle it would support efforts to have Iran reported to the UN Security Council for possible sanctions.

But diplomats said the IAEA board is likely to issue a final ultimatum to Iran, under threat of referring the matter to the UN Security Council for possible sanctions against the country.

German Foreign Minister Joschka Fischer and Douste-Blazy called on Tehran to return to talks on its nuclear programme.

"I call on Iran to listen to the voice of reason and to return to fully respecting the Paris accord" struck last November which set the framework for the trade package and the suspension of Iran's nuclear activities, said Douste-Blazy.

Fischer said Germany, Britain and France were doing everything in their power "to avert a negative development with disastrous consequences".

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