European Union finance ministers on Tuesday abandoned efforts to get a compromise deal over the EU’s controversial proposals to reform hedge funds and private equity after a last-minute intervention by Gordon Brown, the British prime minister.

Spain, which holds the rotating EU presidency, on Tuesday dropped the issue from the agenda of an EU finance ministers’ meeting in Brussels after 11th-hour negotiations failed to overcome hurdles to an agreement.

It emerged on Tuesday that Mr Brown called José Luis Rodríguez Zapatero, his Spanish counterpart, on Monday night, insisting Britain could not accept the compromise plans on the table, the FT reported.