BRUSSELS (Reuters) - Switzerland can expect no progress in talks with the European Union over migrant caps until after Britain's referendum on EU membership in June despite its urgent need for a deal, a senior Swiss official said on Friday.
Switzerland and the EU, its most important trading partner, have been deadlocked over how to implement a binding 2014 Swiss referendum in favor of immigration quotas that would violate a bilateral pact guaranteeing freedom of movement for EU citizens.
The referendum has jeopardized other Swiss-EU treaties that govern bilateral economic ties and stand or fall together.
Some Swiss officials had hoped that an EU deal struck last week with Britain, which is also seeking to limit migration via benefit restrictions, might allow Berne and Brussels to push ahead with resolving the related Swiss issue.
"They say nothing will be possible with you (the Swiss) before the British referendum," Roberto Balzaretti, the Swiss ambassador to the European Union, told Reuters in an interview.
"Britain, we are told, will not be pleased to see the Swiss-EU issue interfering with their campaign," he said.
Britain will hold its referendum on whether to stay in the EU or leave on June 23.
Switzerland needs to implement legislation reflecting the 2014 referendum by Feb 17, 2017. With the legislative process typically taking a year, the Swiss government is expected to make a proposal to parliament on March 4.
Switzerland is not obliged to pay social benefits to foreigners so the possible restriction of benefits that British Prime Minister David Cameron agreed with his fellow EU leaders at a summit last week would not help Berne.
Switzerland is hoping to use an article of its 2002 free movement agreement with the European Union that speaks of remedies in the case of serious economic or social difficulties.
Balzaretti said a British vote to leave the bloc would likely prevent any speedy resolution of the EU-Swiss issue, but even a vote to remain would leave time very tight, with only a month left before Brussels' traditional August shutdown.
The European Commission has said it aims to find a solution on the Swiss issue this year.
(Reporting By Philip Blenkinsop; Editing by Gareth Jones)