Austria warns Hungary it may retaliate in row over migrants

BUDAPEST/VIENNA (Reuters) - Austria said on Wednesday it might be forced to re-instate border controls between it and its European Union neighbour Hungary in response to Budapest refusing to take in asylum seekers sent to it from other EU states.

The diplomatic row between the two neighbours has further weakened the already fragile unity in Europe over how to respond to the flow of migrants into the block and how the burden of dealing with them should be shared out.

Several countries on the EU's periphery say the system for tackling migration is broken, but Hungarian Prime Minister Viktor Orban's decision to halt asylum seeker transfers is the most radical step taken by any European leader so far.

Orban has a history of tangling with Brussels. European Commission President Jean-Claude Juncker, in a barbed joke, once described him as a "dictator". Orban, meanwhile, is under political pressure at home from an anti-immigrant far-right opposition party.

Under EU rules migrants have to apply for asylum in the first member state they enter and if they move onto another EU country, they can be sent back to the country where they entered.

Hungary said it was temporarily suspending accepting such transfers back because it was overwhelmed by migrants, after 61,000 crossed into the country from outside the EU since the start of the year.

That angered Austria, which is where many migrants head to after passing through Hungary.

"Hungary?s decision is completely unacceptable for us," Austrian Interior Minister Johanna Mikl-Leitner said on Austria's ORF radio station. "I expect an explanation."

She said she expected there would be clarification from Budapest in the next few days, but that if that did not happen, "we do not rule out border controls as a last resort."

That would involve passport checks on the Austrian-Hungarian border - something that has not happened since the two countries nearly a decade ago implemented the Schengen agreement on border-free travel.

Austria this month stopped processing asylum requests in an effort to pressure other European Union member states to do more to help absorb waves of refugees.

EU PRINCIPLES TESTED

Freedom of movement across internal borders is a fundamental principle of the EU, but the flow of hundreds of thousands of non-EU migrants across the bloc --many trying to head northwards to countries such as Germany or Sweden - is testing governments' commitment to that ideal.

On Tuesday, after Budapest announced it was suspending the migrant transfers, the Hungarian ambassador came to the foreign ministry in Vienna and was asked to provide an explanation.

"Our position was made clear during a meeting with the Hungarian ambassador," an Austrian foreign ministry spokesman said on Wednesday.

Hungary stood its ground.

Foreign Minister Peter Szijjarto said Austria and other EU states were planning to send illegal immigrants back to Hungary who should instead be sent to Greece.

"We do not agree with this," he told reporters, though he denied his government was violating EU rules.

"This unbelievable pressure from illegal immigration is causing serious technical and capacity problems," he said.

The numbers of migrants trying to reach Europe are up, driven by conflicts in the Middle East and Africa, and a breakdown in order in states along the southern coast of the Mediterranean, allowing people smugglers to operate with impunity.

Much of the focus has been on countries such as Italy, Greece and Malta, where migrants make landfall after making the hazardous journey across the Mediterranean.

But there is also an overland route into Europe with Hungary as the entry point. Budapest said it is having to shoulder the burden for dealing with the flow with not enough help from Brussels.

Orban's government earlier this month ordered the construction of a fence along Hungary's border with Serbia to keep people from crossing illegally.

(Additional reporting by Krisztina Than in Budapest and Angelika Gruber in Vienna; Writing by Christian Lowe; Editing by Jeremy Gaunt)