The European Union has dropped proposals to ban Nazi symbols across its 25 member states.
Prince Harry apologised for his choice of fancy dress
Luxembourg, which currently chairs the EU, withdrew the plans when it became clear that members could not agree on which symbols to ban.
There were also concerns that a ban was a threat to freedom of expression.
The ban was proposed shortly after an heir to the British throne, Prince Harry, was photographed wearing a WWII German uniform with a swastika armband.
Prince Harry subsequently apologised for causing offence by his choice of outfit for a fancy dress party.
Freedom of expression
Correspondents say banning the swastika would be tricky, as it is a time-honoured good luck symbol for Hindus.
Britain, Denmark, Hungary and Italy also voiced concerns at a meeting of justice ministers in Brussels on Thursday that a ban of symbols like the swastika could curb freedom of expression.
The calls for a ban on Nazi symbols had prompted some Euro MPs from former communist countries to call for a similar ban on the symbols of Soviet rule, such as the hammer and sickle. This had already been rejected before the decision on Nazi symbols was made.
The bans could have been included in proposals from the European Commission to harmonise national laws designed to fight racism and xenophobia.
Danish Justice Minister Lene Espersen told reporters that ministers had agreed to resume talks on the commission's plans to make public incitement to racist violence or hatred punishable with minimum two-year jail terms across the EU.
The only country in Europe which has banned the use of Nazi insignia is Germany.
However, France, for example, bars the sale of Nazi-related memorabilia.