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By Francois Murphy
VIENNA (Reuters) -Austria's far-right Freedom Party (FPO) and the conservative People's Party (OVP) denied on Tuesday their talks on forming a coalition government had collapsed after media reports of a halt, but the OVP said they were in a "difficult phase".
The reports by tabloid media Heute and oe24 that the talks had at least temporarily been stopped, and the parties' swift response, illustrated how brittle the negotiations are. Negotiators say several stubborn obstacles remain to a deal that would produce Austria's first FPO-led government.
"No, talks have not been broken off. The OVP is evidently holding internal deliberations. That is completely normal in negotiations," the eurosceptic, Russia-friendly FPO said on social media platform X, calling the reports a "hoax" and adding: "We can continue (the talks) tomorrow."
The FPO came first in September's parliamentary election with around 29% of the vote. FPO leader Herbert Kickl was tasked last month with forming a government after a centrist attempt to form a ruling coalition without the FPO collapsed.
Soon after the FPO, the OVP issued its own statement saying negotiators were due to continue discussions on Wednesday.
"The negotiations on forming a new government are in a difficult phase. The OVP remains in ongoing negotiations," the OVP said
At the same time, thousands of protesters opposed to the potential tie-up marched from the chancellor's office to the nearby OVP headquarters, waving banners reading "Not again" and "Kickl is a radical conspiracy theorist".
Newspaper Der Standard reported that the FPO had insisted in talks that the chancellor's office, which would be led by Kickl, be in charge of constitutional and European Union affairs as well as media, a red line for the OVP, and had sought control of the powerful finance and interior ministries.
The OVP said only that issues it mentioned as being of central importance to it at the start of talks, such as Austria's EU membership and independent media, remained so.
(Reporting by Francois Murphy; Editing by Alex Richardson and Nick Zieminski)
