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Britain has blocked the first crucial talks on intelligence and espionage between European officials and their American counterparts since the NSA surveillance scandal erupted. The talks, due to begin in Washington on Monday, will now be restricted to issues of data privacy and the NSA's Prism programme following a tense 24 hours of negotiations in Brussels between national EU ambassadors. Britain, supported only by Sweden, vetoed plans to launch two "working groups" on the espionage debacle with the Americans. Instead, the talks will consist of one working group focused on the NSA's Prism programme, which has been capturing and storing vast amounts of internet and mobile phone metadata in Europe. The disclosures in the Guardian over the past month have triggered a transatlantic crisis of confidence and threatened to derail crucial free trade talks between the EU and the US, also due to be launched in Washington on Monday. The talks on Prism and data privacy have been arranged to coincide with the trade talks in an attempt to defuse the transatlantic tension. EU diplomats and officials say the offer of talks by the Americans is designed to enable the leaders of Germany and France to save face following revelations about the scale of US espionage – particularly in Germany, but also of French and other European embassies and missions in the US.