International observers are expressing concern about the outcome of Sunday's parliamentary elections in Serbia, where ultra-nationalists led by a jailed war-crimes suspect won the most votes. First official results show pro-democracy parties that toppled the government of President Slobodan Milosevic can form a new coalition government only if they end their political squabbling. Officials from the Council of Europe and the Organization for Security and Cooperation in Europe, the OSCE, said that Sunday's ballot in Serbia had shown "a lack of political responsibility" as three of the candidate lists were led by war crimes suspects.

Both organizations, which were part of the International Election Observation Mission, urged Belgrade to review election legislation, amid growing concern about the influence of politicians who were allegedly involved in atrocities during the Balkan wars of the 1990s.

[In Washington, a State Department spokesman praised the free and fair conduct of the vote and urged the parties to reach a consensus and form a new government quickly. He noted that pro-democracy parties won more than 60 percent of the vote and are likely to form any future government.]

In a major blow for pro-western parties, early official results showed the Serbian Radical Party of jailed war crimes suspect Vojislav Seselj winning with about 28 percent of the vote.

A further seven percent of the ballots went to the Radical Party's ally, the Socialist Party of Serbia, which is led by ousted president Slobodan Milosevic. Mr. Milosevic is also in custody at The Hague, accused of dozens of war crimes, including genocide.

There is international pressure on the three main reform parties to bury their rivalries and use their combined 42 percent of the vote to form a new coalition government.

Meanwhile, European Union diplomats have already warned the growing political clout wielded by war crimes suspects could destabilize the whole region.

There is also concern that any new government will be less likely to transfer key war crimes suspects to the U.N. tribunal for trial.

Some international experts also fear the new government will have to struggle to revive stalled reforms in one of Europe's poorest countries, where the jobless rate is running about 30 percent.

The reformists suffered a crucial blow last March when Prime Minister Zoran Djindjic was shot to death in a killing blamed on underworld figures linked to the Milosevic-era paramilitary police.

Their coalition fell apart eight months later, forcing elections to be called a year ahead of schedule.

Outgoing Deputy Prime Minister Nebojsa Covic has described the results of Sunday's elections as a "punishment" for the government's failure to improve living standards, after years of international isolation under the Milosevic regime.