Airline Passenger Data Row

European negotiators flew out of Washington on Saturday after the US side introduced fresh requirements which were not within their mandate to accept, EU sources said.

However transatlantic airlines continued Sunday to hand over the information required by the US authorities, regardless of any legal vacuum, according to airline spokesmen.

Both the US and EU sides stressed that they were close to an agreement and that discussions would continue this week, with EU Justice Commissioner Franco Frattini and US Homeland Security Secretary Michael Chertoff likely to speak by telephone on Sunday.

"There is no deal. It's a shame because we are 90 percent there," EU spokesman Jonathan Todd told reporters in Brussels on Sunday. "The EU team has flown out of Washington but talks will continue this week."

New US elements throw agreement in doubt

Finnish EU presidency spokesman Marko Ruonala echoed that "we are close to a deal" but added that "some new elements" introduced in the talks had hampered completion of an agreement.

"The presidency will consult other member states and negotiators will come back to the issue" later this week, he added, without specifying a timetable.

The European Commission, the EU's executive arm, will also take up the matter.

A spokesman for transatlantic carrier Air France assured that the lack of an agreement had had "no impact on Air France flights to the United States."

"In the absence of an agreement by September 30, and like all the other airlines, we are continuing to transmit the passenger data," he said.

Asked about the possible illegality of doing so he voiced the safety in numbers principle. "It's what all the other airline companies are doing."

Chertoff remained upbeat, saying that the US side had sent an initial draft to the Europeans which he felt satisfied fulfilled their fundamental data protection requirements.

US sees a solution in the pipeline

"I am pleased to announce that following our negotiations with representatives of the European Union, I have initialled a draft formal US/EU agreement regarding the sharing of Passenger Name Record data," Chertoff said in a statement from Washington on Saturday.

"We expect that planes will continue to fly uninterrupted and our national security will not be impeded," he added. "The proposal ensures the appropriate security information will be exchanged and counter-terrorism information collected by the department will be shared, as necessary with other federal counter-terrorism agencies."

US Homeland Security Department spokesman Jarrod Agen described the EU announcement that the talks had broken up without agreement as "not accurate."

Transatlantic flights in legal limbo

However the expiration of Saturday's deadline, set by the European Court of Justice, leaves transatlantic air travel in a legal limbo.

In the name of the "war on terror", US authorities in 2003 demanded that airlines transmit their passengers' personal data to US security officials for all US-bound flights.

Airlines must provide the US authorities with dozens of details about passengers and crew -- including credit card information, addresses and telephone numbers -- 15 minutes before departure of a flight.

In its ruling in May, the European Court of Justice objected to the way the original agreement was reached in 2004, but not what was contained in it. It set a deadline of September 30 for a new deal to be reached.

EU flights could be denied access to US

Now if European airlines don't provide the info required by the US authorities they could be denied entry to the States. If they do then they would be breaching EU rules.

EU and US negotiators had resumed last-gasp talks in Washington on Saturday aimed at avoiding any air traffic chaos.

The two sides are trying to reach agreement on the PNR data after Europe's top court quashed their previous accord on a legal technicality but allowed them to continue using it until September 30.

The talks have stumbled previously over US demands that the content of the agreement also be renegotiated; something Brussels is reluctant to do.