French President Jacques Chirac and his partners from Germany, Belgium and Luxembourg stressed they did not want to undermine the US-European alliance or the 19-nation military bloc.

Nevertheless the proposals, issued at a controversial mini-summit of the four nations in Brussels, have the potential to provoke disquiet in Washington and London.

In particular, talk of a new "European Security and Defence Union"could be viewed with suspicion in other EU capitals.

The ESDU would "gather those member states that are ready to go faster and further in strengthening their defence cooperation", the four leaders said in a joint statement after two hours of talks.

Such a development raises the prospect of a two-speed Europe as the EU struggles to forge a common foreign and security policy, which has been left largely in tatters by divisions over the war on Iraq.

The four leaders instructed their defence ministers to "take the necessary steps to establish, not later than 2004, a multinational deployable force headquarters for joint operations". The headquarters would be based at Tervuren, outside Brussels.

"We believe the time has come to take new steps in the construction of a Europe of security and defence, based on strengthened European military capabilities, which will also give a new vitality to the Atlantic alliance," they said.

British Prime Minister Tony Blair issued a thinly veiled warning to the four nations on the eve of the summit.

"We won't accept, and neither will the rest of Europe, anything that either undermines NATO or conflicts with the basic principles of European defence we've set out," he said.

Along with France, Britain is one of the EU's few military heavyweights, and observers say its armed forces must be at the heart of any credible European defence strategy.

Much of the joint statement was directed at the convention now writing the EU's first-ever constitution, with the leaders calling on the forum to take their suggestions on board in drafting the text.

The EU is already setting up a 60,000-strong "rapid reaction force" in partnership with the 19-nation NATO alliance, which has been the bedrock of western Europe's defence.

The summit countries were the same four that earlier this year sparked the most serious rift in NATO history, when they refused a US request to beef up Turkey's defences ahead of war on Iraq.

Luxembourg soon dropped out of the dissident camp, but the other three kept up their opposition for weeks on end, sparking fury in the US government.

Chirac, however, stressed the "fundamental character" of the transatlantic alliance after the defence summit.

"Our countries see their commitments in the European Union and in NATO as complementary commitments," the French president said.

"In building a stronger Europe we obviously contribute to a stronger Atlantic alliance."

German Chancellor Gerhard Schroeder said the EU's enlargement next year to 25 countries made it more pressing than ever to forge a common security policy.

"I underline that in NATO, we don't have too much America, we don't have enough Europe," he also said. "That's why we met today, to take stock of this situation."

Belgian Prime Minister Guy Verhofstadt joined Schroeder in insisting the four countries' initiative was open to the rest of the EU, after criticism of the summit by Britain, Italy, Spain and the Netherlands.

But Spanish Foreign Minister Ana Palacio, writing in Tuesday's Wall Street Journal Europe, said the mini-summit could well backfire.

She warned that "if a policy were to be proposed at a time of controversy -- as this one clearly is -- it would become a cause of division within the Union and could prove counterproductive".

SPACE.WIRE