By Luke Baker and Andreas Rinke

BRUSSELS (Reuters) - German Chancellor Angela Merkel accused the United States of an unacceptable breach of trust on Thursday after allegations that the U.S. bugged her personal mobile phone, and she indicated data agreements with Washington may have to be revised.

Arriving for a two-day summit in Brussels overshadowed by the allegations of eavesdropping by the U.S. National Security Agency against Italy, France and Germany, Merkel said she had told President Barack Obama in a telephone conversation late on Wednesday that the acts were unacceptable.

"It's not just about me but about every German citizen. We need to have trust in our allies and partners, and this trust must now be established once again," she told reporters after arriving in a car with '007' in the numberplate.

"I repeat that spying among friends is not at all acceptable against anyone, and that goes for every citizen in Germany."

The stern words were her first public pronouncement after the German government said on Wednesday it had evidence the chancellor's mobile was "monitored" by the NSA. Germany's foreign minister summoned the U.S. ambassador to Berlin to discuss the issue, an event diplomats said was almost unprecedented in the past 60 years.

White House spokesman Jay Carney said Obama had assured Merkel in their telephone call that the United States "is not monitoring and will not monitor" her communications, leaving open the possibility that it had happened in the past.

The affair dredges up memories of eavesdropping by the Stasi secret police in the former East Germany, where Merkel grew up, and is an emotive topic for many Germans.

Following the unceasing flow of leaks by former U.S. data analyst Edward Snowden, which has revealed the vast reach of the NSA's spy programs, Washington finds itself at odds with a host of important allies, from Brazil to Saudi Arabia.

Britain's Guardian newspaper reported on Thursday that one NSA contact, a U.S. official, had provided the telephone numbers of 35 world leaders that had then been monitored.

Germany's frustration follows outrage in France after Le Monde newspaper reported the NSA had collected tens of thousands of French phone records between December 2012 and January 2013, and an Italian news magazine reported on Thursday that the NSA had monitored sensitive Italian telecommunications.

The revelations could have an impact on major legislative and trade initiatives between the United States and the European Union, with some German lawmakers saying negotiations over an EU-U.S. free-trade agreement should be suspended.

Merkel, who has previously discussed a "no spying" agreement with the United States, hinted that data-sharing deals with Washington may need to be reexamined, a potentially damaging blow for U.S. efforts to collect counter-terrorism information.

"To this end, we need to ask what we need, which data security agreements we need, what transparency we need between the United States of America and Europe," Merkel said.

"We are allies facing challenges together. But such an alliance can only be built on the basis of trust."

While Berlin and Paris are likely to find sympathy among the EU's 28 member states, domestic security issues are not a competence of the European Union. The best that may be hoped for is a public expression of support from leaders and calls for a full explanation from the United States.

On their way into the summit, several European leaders did express their shock and surprise at the allegations.

"This is serious," said Dutch Prime Minister Mark Rutte.

"I will support (Merkel) completely in her complaint and say that this is not acceptable. I think we need all the facts on the table first."

DATA PRIVACY RULES

The most immediate impact of the furor could be to encourage member states to back tougher data privacy rules currently being drafted by the European Union. The European Parliament this week backed legislation that would greatly toughen EU data protection rules that date from 1995.

The new rules would restrict how data collected in Europe by firms such as Google and Facebook is shared with non-EU countries, introduce the right of EU citizens to request that their digital traces be erased, and impose fines of 100 million euros ($138 million) or more on rule breakers.

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