By Robin Pomeroy

ROME, Oct 3 (Reuters) - Italian food producers, consumers and conservation groups hope to get three million signatures in a petition drive to ban genetically modified food, a move they hope will renew Europe's rejection of biotech crops.

At a time when the companies that make the GM crops grown widely in North and South America hope that European resistance is dwindling, Italian campaigners said they were confident they could turn the tide.

"What's happening is an extraordinary experiment in participatory democracy," Mario Capanna, chairman of Genetic Rights, one of the members of the "GMO Free" coalition, said.

In hundreds of marketplaces and food fairs across Italy, campaigners have been handing out forms that look like ballot papers.

They invite people to answer "yes" or "no" to whether food production should be "genuine ... founded on biodiversity and free from GMOs".

The campaign, supported by consumer associations, agriculture lobby Coldiretti and green groups like Greenpeace and WWF, hopes to have 3 million signatures by Nov. 15.

European consumers have expressed concern that crops whose genes have been altered in a laboratory, for example to provide higher yields, might contain hidden risks to health or the natural environment, but the issue is far less prominent in the news media than it was five years ago.

"UNDUE DELAYS"

The unofficial referendum comes at a time when the EU's approvals procedure appears to be becoming less hostile to new biotech crops.

Following a complaint by major GMO producers the United States, Canada, and Argentina in 2003, a World Trade Organisation ruling last year found "undue delays" in EU procedures where GM-sceptic countries have been blocking approvals.

At recent votes, some previously anti-GMO countries have abstained rather than vote against.

The Italian campaign has no explicit government backing but Capanna said a mass "no" from the Italian people would force politicians to impose a complete ban on GM food in Italy where at present no GM crops are allowed to be planted but some GM organisms are imported as animal feed such as soy.

He acknowledged this would be considered illegal by the European Commission which polices the EU's single market and would launch legal action against Italy. The Commission can impose hefty fines on countries but only after lengthy legal hearings.

"We will not be afraid, we will say: 'Tell us how much it will cost and we will pay it.' And this will be the biggest advertisement in the world to promote quality agriculture."

As a major exporter of high-end produce like ham, cheese, olive oil and wine, Italy would benefit by having a world renown for traditional food, he said.

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