LAST-DITCH efforts to avoid the European Union pulling out of the southern Bosnian town of Mostar collapsed early this morning.
This followed an earlier failure by Bosnian Croats to meet a deadline to end their boycott of the city council.
Croat and Moslem delegations were seen arriving in the evening at the offices of the European Union where they were received by the EU administrator of Mostar, Sir Martin Garrod.
However, after six hours of talks he said: "I'm afraid we did not achieve an agreement, the two sides could not agree with each other.
"It was impossible to get a reconciliation."
He now expects a final decision on EU withdrawal from the town today.
EU officials say any withdrawal from the town they have run for two years will have serious consequences for Mostar and the Bosnian peace process as a whole.
The EU had set a deadline of midnight on Saturday for Mostar's Croats to cease their boycott of the city council.
Although Sir Martin referred to the situation as "very bad news", efforts continued yesterday.
"The Croatian side gave another proposal," an EU spokesman, Mr Dragan Gasic, told journalists. "We are trying to get into contact with the Bosnians [Bosnian Serbs]."
Mr Gasic refused to comment on the contents of the proposal but added: "New proposals always try to work out what was contentious before."
Mostar's election was seen as a key test for elections throughout Bosnia, due to be held on September 14th. The refusal by one side to respect the result does not augur well for the next ballot.
The sticking point is that the Croats want the council, on which a Muslim led coalition won a majority in the June 30th election, to be a "provisional" body until their complaints about the poll are ruled on by the constitutional court of the MuslimCroat Federation, the EU said.
Sir Martin, head of the EU mission in the southern Bosnian city, said the EU had "leant over backwards" to meet the Croats' demands, but in vain.
"I think there are very serious implications for the whole Dayton peace accord and the peace process in general in Bosnia," he added.
Mr Carl Bildt, the senior civilian official overseeing the peace process, said the international community expected the Croatian President, Mr Franjo Tudjman, to do whatever he could to stop the Bosnian Croats undermining the Dayton agreement.
. A spokesman for the Irish Presidency of the EU described the planned withdrawal as "a bad omen for the peace process in Mostar and in Bosnia generally", writes Denis Coghlan.
The EU spokesman said the withdrawal of 6 European civilians (including three Irish) will begin "because there is no basis for the continuing presence in the absence of local political agreement."