TOKYO -- Japan has refused to grant citizenship to a Japanese couple's twins because an American surrogate mother gave birth to them, officials said Thursday.

The Justice Ministry's decision could discourage Japanese couples unable to have their own children from seeking out surrogate mothers overseas. Surrogate births are virtually nonexistent in Japan, where the practice is frowned upon and the government wants to outlaw it.

Ministry official Yoshikazu Nemura said the two boys can't be given citizenship because Japanese law requires that the biological mother be a Japanese citizen.

According to media reports, the twins were conceived from the father's sperm and eggs donated by an Asian-American woman.

Without citizenship, the children would be excluded from most schools.

The boys were born last October at a hospital in California, which makes them U.S. citizens, a status Japan recognizes, Nemura said.

The Japanese couple, who are in their 50s, reportedly tried fertility treatments in Japan before turning to a company that offered surrogate birth.

Surrogate births involve removing an egg for fertilization and implanting it into another woman who carries the baby until its birth.

The Japanese health ministry is opposed to surrogate births. Officials are trying to draw up legislation that would make the practice illegal and impose stiff penalties on those who violate the ban.

Ethical standards set by the Japan Society of Obstetrics and Gynecology already restrict in-vitro insemination to married couples.

As a result, few doctors will perform a surrogate birth, and many childless couples have turned to fertility clinics in the United States.

The couple have several options. They could challenge the decision in court or ask immigration authorities to grant a change of citizenship.

The couple can also legally adopt the children. To do so, they must resubmit the birth certificates with the surrogate mother listed as the infants' mother, offer proof that the children were conceived with the father's sperm and show immigration paperwork showing that the children are in Japan, the ministry official.

In May 2001, a Japanese doctor sparked controversy when he disclosed that a surrogate mother had successfully delivered a healthy baby for the first time in Japan. He delivered another one last year.

Even infertility treatments are still controversial in Japan although the country is troubled by a falling birthrate and rapidly graying population.