By Matthew Price BBC Belgrade correspondent

Talks to finalise an agreement on the future of the Yugoslav Federation have failed to end up with a settlement, despite intense diplomatic pressure from the European Union.

It's dramatic and a pity that for one article, they are not going to finalise the agreement

Javier Solana, EU's Foreign Envoy

Negotiators in Yugoslavia and its two republics Serbia and Montenegro were unable to agree on the final draft of a new constitution.

Yugoslavia is due to be replaced by a looser union between Serbia and Montenegro, but hopes that the new body could be in place by the end of the year now appear to be unrealistic.

The EU's foreign policy representative, Javier Solana, said that it meant that crucial talks on Yugoslavia's progress toward closer ties with the EU would be held back.

Sticking point

The EU appears to be getting increasingly frustrated with politicians here in Belgrade.

Mr Solana flew in to the city and early on Friday started a series of top level meetings.

He was trying to clear up the differences which remain between politicians on the drafting of a new constitution for the Union which will replace the Federation.

But on the subject of how the republics elect their representatives to the new Union there was no agreement.

Mr Solana said this would mean a delay in talks on Yugoslavia's progress to the EU.

"It's dramatic and a pity that for one article, they are not going to finalise the agreement. I think it's very sad, for relations of your country with the culture of Europe.

Deadlock

Yugoslavia had been scheduled to join the 44-nation Council of Europe by the end of September.

Mr Solana said that now appeared unlikely.

The Yugoslav President, Vojislav Kostunica, said he did not expect the deadlock to be resolved until after elections due in Serbia and in Montenegro in October.

It pushes the final formal end of Yugoslavia back even further, perhaps even well into next year.