Greece denies report of capital controls by weekend if talks fail

ATHENS/BERLIN (Reuters) - Greece's government denied a German newspaper report on a euro zone plan that involves Athens imposing capital controls this weekend if it fails to reach a deal with creditors this week, a government official told Reuters on Monday.

A spokesman for the German government said he could not confirm or deny the report. A European Commission spokesman declined to comment on the report.

The German daily Sueddeutsche Zeitung online edition said that the euro zone had agreed on a contingency plan for Greece that also involved imposing capital controls on Greek banks if no cash-for-reforms deal is reached by the weekend.

However, the unsourced report also said that the Greek government itself had to pass a special law to introduce such capital controls.

The newspaper said "it became known in Berlin and Brussels" that Greece's international creditors wanted to give Athens another chance and see if the euro zone finance ministers could clinch a deal by the end of the week.

If the finance ministers, who are scheduled to meet on Thursday and Friday, are not able to seal an agreement, an EU emergency summit should be convened in Brussels, possibly on Friday evening, the report said.

At this summit, a political solution should be sought again, the report said.

A French diplomat told Reuters when asked about the report that there were "plenty of things that circulate", but no meeting had been scheduled. "We'll see," the diplomat said.

(Reporting by Lefteris Papadimas in Athens and Andreas Rinke/Michael Nienaber in Berlin; Additional reporting by Alastair Macdonald in Brussels and Elizabeth Pineau in Algiers; Editing by Louise Ireland)