Gibraltar smear tactics denied by Hurd

Britain yesterday rejected suggestions that it was undermining the government of Gibraltar after complaints of a "dirty tricks" campaign from the colony's chief minister, Joe Bossano.

But the Foreign Office confirmed London was insisting the colony move swiftly to implement European Union regulations. The directives cover such areas as banking practice, intended to curb money laundering and other irregular financial transactions.

"There is no dirty tricks campaign," a Foreign Office spokesman said. "We are seeking to ensure that the European Union directives and other pieces of legislation are implemented as soon as possible. We are working together with the government of Gibraltar on this."

Senior Whitehall sources say the British government has been seeking by quiet persuasion for some time to speed up compliance without notable success.

Spanish police have imposed rigorous border controls, saying cigarette and drug smuggling from Gibraltar must be reduced. Spain also insists there is a serious problem with money laundering by offshore banks.

Mr Bossano, in interviews yesterday, depicted himself as the target of a hostile campaign intended to undermine Gibraltar's status and to give Spain a greater say in its future.

In remarks clearly aimed at an audience of Euro-sceptics in London, the chief minister said: "The present administration, which has decided that the future is in Europe, is more concerned about their relationship with Spain than with their debt to the people of Gibraltar."

But Douglas Hurd, the Foreign Secretary, said yesterday that Britain would not compromise over the Rock's sovereignty, and would resist Spanish pressure. "We are absolutely committed to what is in the Gibraltar constitution," Mr Hurd said. The 1969 constitution specifies there could be no change in the Rock's sovereignty without the consent of its people.

Speaking before he left Brussels for London for talks last night and today with the Spanish Foreign Minister, Javier Solana, Mr Hurd said they would discuss the border problem and Britain's obligations in Gibraltar under EU law.

Spanish border checks had diminished over the weekend, Mr Hurd said. But he warned: "We will not negotiate under duress."

Mr Solana, speaking to Spanish radio, said Spain wanted firm measures. "Smuggling of drugs and tobacco is taking place through Gibraltar and there is a problem related to money laundering. This must be stopped and the British government has the responsibility of co-operating in stopping it."

For his part, the Foreign Secretary confirmed Britain is under pressure from Brussels to make progress.

"The European Union is anxious that there be progress between Spain and Britain, mainly because the dispute is holding up a crucial piece of legislation on Europe's external frontiers," Mr Hurd said.