BRUSSELS, May 3: The European Union today broke off talks on closer ties with Serbia over its failure to arrest and transfer fugitive genocide suspect Ratko Mladic to the UN war crimes tribunal.
Announcing the move, Enlargement Commissioner Olli Rehn said it was necessary to apply ''rigorous conditionality'' to countries aspiring to EU membership, a message intended to reverberate across the Balkans and reassure EU citizens.
Serbian Prime Minister Vojislav Kostunica insisted his government had done all it could to bring the former Bosnian Serb military commander to justice and Mladic was now on the run alone after his support network had been smashed.
''In view of the fact that his entire network of helpers has been uncovered, Ratko Mladic is now hiding completely alone. The question now is ... to discover where he is hiding,'' he said in a statement.
Rehn said Brussels had made clear last year that Serbia's full cooperation with the Hague tribunal was needed to conclude talks last year on a Stabilisation and Association Agreement -- the first step towards eventually joining the EU.
He received a detailed update today from chief UN war crimes prosecutor Carla del Ponte, who had urged the EU to take a tough stance.
Del Ponte told a news conference in the Netherlands that Serbia had misled her when it promised to hand Mladic over to the UN tribunal last month, a deadline set by the EU.
Rehn said: ''It is disappointing that Belgrade has been unable to locate, arrest and transfer Ratko Mladic to the Hague.
''The Commission therefore has to call off the negotiations on the Stabilisation and Association Agreement.''
The former Bosnian Serb military commander is charged with genocide over the 1995 Srebrenica massacre of 8,000 Bosnian Muslims -- Europe's worst atrocity since World War Two -- and over the 10,000 deaths in the 1992-95 siege of Sarajevo.
''DRAMATIC IMPROVEMENT NEEDED''
The next round of talks had been due on May 11.
''This issue is about the rule of law, Serbia must show that nobody is above the law and that anyone indicted for serious crimes will face justice,'' Rehn said. ''The armed forces and the security services need to be fully under democratic control.'' It was still possible to conclude the association agreement by the year-end as planned, but only if there was a ''dramatic improvement'' in cooperation with the tribunal that would allow resumption of talks, he said.
The EU move sends a strong signal to other Balkan states aspiring to EU accession that the bloc is serious about conditions it sets for membership.
It comes at a time when plans to enlarge the 25-member bloc have come under considerable strain and the executive Commission faces pressure to slow the process following the rejection of an EU constitution by French and Dutch voters last year.
Today's Belgrade dailies treated the suspension of talks as a foregone conclusion. ''Europe punishes Serbia,'' was one headline.
The head of Serbia's office for cooperation with the Hague, Rasim Ljajic, told the daily Politika that suspension of talks would not end efforts to deliver Mladic.
''I have to say that in the case of Ratko Mladic we are waging a double battle -- with time and with the fact that the fugitive general is hiding himself very well,'' Ljajic said.
The liberal daily Danas said Serbia would be ''be labelled a lying country in which those whom every other country and people would renounce with loathing may find a certain refuge''.
Greece, one of Serbia's closest traditional allies, urged it to deliver Mladic to claim its rightful place in Europe.
''We believe that the commitments of Serbia towards the ICTY must be met,'' its Foreign Minister Dora Bakoyanni said after a meeting of Balkan counterparts, including Serbia. ''But let me stress that Serbia has an important place in tomorrow's Europe.''