Tension in trans-Atlantic ties has been growing in recent months over the bombing of and sanctions on Iraq. France is also concerned about US hegemony in world affairs, manifested by the creation in Paris of the term "hyper-power," but the latest back-to-back hitches may point to even deeper malaise.

Just eight days after Paris angered Washington by pointedly refusing to sign onto the final declaration of a US-sponsored international conference on democracy, news of the French spy investigation drew a flat, terse response from the State Department.

"I don't know what they think they're investigating or where they intend to proceed," spokesman Richard Boucher said when asked about the probe into the Echelon electronic surveillance system that some believe the United States uses to collect proprietary business secrets to benefit US firms.

"The notion that we collect intelligence in order to promote American business is simply wrong," Boucher told reporters.

"Our intelligence agencies are not authorized to provide information to private firms. It's not the policy nor the practice of American intelligence services to conduct economic espionage," he added, repeating comments made by the department when the Echelon controversy first erupted in the European parliament.

Earlier Wednesday, the parliament voted to set up a committee to examine questions over Echelon, an intelligence network run by the US National Security Agency (NSA) that gathers information from listening posts in the United States, Britain, Canada, Australia and New Zealand with additional input from about 120 US satellites.

A move in the parliament to create a full committee of inquiry failed on British opposition.

But in France, chief prosecutor Jean-Pierre Dintilhac ordered an investigation into whether information collected by the Cold War-era surveillance system has been used to sabotage European companies in bids against American competitors.

French authorities are concerned that Echelon, which is capable of sifting through millions of telephone calls, faxes and e-mails a day, poses a threat to France's "fundamental interests."

A White House spokesman said he was unaware whether or not France had officially contacted the United States about an investigation.

"We have a dialogue with France on a wide range of issues and any concern they raise with us we will of course cooperate with them," said White House spokesman P.J. Crowley.

Boucher, meanwhile, refused to characterize the Echelon investigation as another in a series of blows to the Franco-US relationship, saying the two countries have in "many, many areas a significant and cooperative relationship."

He acknowledged, however, that "we disagree on other things at times," a specific reference to the French snub at last week's democracy conference in Poland that Secretary of State Madeleine Albright herself termed "weird."

"I think it's pretty weird when a country that says its motto is 'liberte, fraternite, egalite' decides to (do something like this)," Albright said after France refused to associate itself with a statement declaring democracy to be a universal right and value worthy of promotion and protection.