By Mark Heinrich

Europe's top security and human rights watchdog Thursday halted talks on keeping peace monitors in Georgia after Russia blocked a deployment plan, but it stood by the proposal and nudged Moscow to reconsider.

Russia sent in troops to crush Georgia's move to retake its separatist South Ossetia region in a war last August, then rejected an extension of the Organization for Security and Cooperation in Europe's 16-year-old monitoring mission in the former Soviet republic when it expired on Dec. 31. The military and civilian monitors face a June 30 deadline to pull out.

Wednesday, Russia barred a revised monitoring proposal from OSCE chairman Greece by insisting on language driving home its view of South Ossetia as an "independent" state -- rejected by Georgia and not endorsed elsewhere in the 56-nation group.

U.S. and European Union officials regard an OSCE presence in Georgia as crucial to preventing further fighting between separatist and Georgian forces and mistreatment of civilians.

Greece's OSCE ambassador, Mara Marinaki, announced a suspension in five-month-old negotiations on a new OSCE presence in Georgia. But she said the current proposal remained on the table and she called for "strong political will" to accept it.

She made clear she would stick to an approach that omits mention of Georgia or South Ossetia and related political and geographic references -- skirting the hot-button issue of the separatist territory's status -- while stipulating free movement for monitors across the August cease-fire line.

"CRUCIAL" OSCE PRESENCE

"We need to review the results of our efforts to build the required consensus around the Greek proposal based on the 'status-neutral' formula that would allow the OSCE to continue its crucial work in Georgia," Marinaki said in a statement.

Marinaki told reporters later she regarded the break-off of talks to be temporary and an agreement would come if key parties were willing to "go the extra mile."

In Moscow, Interfax news agency quoted a Russian Foreign Ministry source as saying no final decision had been made and dialogue would go on but that Greece's plan "makes no sense."

"This plan is based on the premise that everything in the region remained the same after the Georgian aggression. But this plan won't work. Tskhinvali (South Ossetia's regional capital) will not let the observers enter its territory."

Georgia's Foreign Ministry accused Russia of trying to force the OSCE out of the country to legalise an "illegal recognition of our occupied regions" and turn them into "non-transparent and unaccountable black holes, where ethnic cleansing is an ongoing practice and where human rights are violated on a daily basis."

U.S. Vice President Joe Biden urged Georgia and Russia to exercise restraint and contribute to the stability of Georgia's separatist regions in a phone call on Thursday with Georgian President Mikheil Saakashvili, the White House said.

"The vice president noted the importance of the work of international organizations like the OSCE in Georgia," the White House said in a statement. He also reaffirmed the U.S. commitment to work with the international community to address security humanitarian and human rights concerns, it said.

U.S. OSCE envoy Kyle Scott urged Russia to rethink what he called its "excessive amendments" which he said offended almost all OSCE states seeking a "genuine compromise" on monitoring.

"We call one last time for (Russia) to reconsider ... in the spirit of cooperation to avoid the deterioration of a critical security architecture we have worked so hard over the years to build," Scott told an assembly of OSCE ambassadors.

Greece's solution would leave Russia's quest for broad recognition of pro-Moscow South Ossetia's "independence" to be addressed at "status" talks in Geneva, while accommodating the insistence of Georgia and its Western allies on Georgian territorial integrity and a single OSCE mission in the country.

But Russia Wednesday answered the Greek draft proposal with its own version that crossed out references to "free and unimpeded contact and movement" across the truce line.

Any movement, it said, would be agreed with "relevant authorities," meaning the rebels and Russians, with separate monitor missions in South Ossetia and state-controlled Georgia.

(Additional reporting by Conor Sweeney in Moscow and Matt Robinson in Tbilisi; Editing by Michael Roddy)

URL: http://in.reuters.com/article/oilRpt/idINLE33095720090514