JERUSALEM - Israel has blamed a clerical error for a government statement that appeared to admit that its Mossad intelligence agency operated in New Zealand last year.

The arrest in Auckland of two Israelis who confessed to trying to obtain a New Zealand passport fraudulently soured diplomatic ties.

Israel apologised over the incident but made no comment on Wellington's charges that the men were spies.

Announcing ice-breaking talks yesterday between Foreign Minister Silvan Shalom and New Zealand Ambassador Jan Henderson, a government statement noted that the meeting would be the first of its kind "since the incident with the Mossad".

Asked if this constituted an official admission, Foreign Ministry spokesman Mark Regev said "incident with the Mossad" should have been in inverted commas to reflect that, as far as Israel is concerned, espionage is a New Zealand allegation.

"We have never said more than we have said in the case," Regev said. "This issue has been solved in a satisfactory way with the New Zealand government."

Uriel Kelman and Eli Cara were arrested in March 2004 and pleaded guilty to assuming the identity of a bed-ridden Auckland man and attempting to order a passport in his name. They were jailed for three months and deported.

New Zealand authorities were tipped off when a passport clerk reported the foreign accent of one of the Israelis.