Gordon Brown and President George Bush have warned Iran to accept their "offers of partnership" or face tough sanctions and international isolation.The UK prime minister said he wanted to maintain a dialogue with Tehran, but if Iran ignores UN resolutions then sanctions would be intensified.
Europe would take action to freeze overseas assets of Iran's biggest bank and impose new oil and gas sanctions.
The two were speaking at a press conference after talks in London.
The trip is part of Mr Bush's European tour - although he dismissed reports that it would be his last before leaving office as "speculation".
Iran's nuclear ambitions
In their talks on Monday the two leaders discussed issues including Iraq and Afghanistan, Burma and Zimbabwe and oil and food prices.
Iran has been accused of not co-operating with the UN over its nuclear programme, amid fears it is enriching uranium to use in weapons.
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