Copenhagen, Dec 10 (IANS): Denmark will hold a referendum by March 2016 on abolishing its policy of opt-out from the European Union's justice rules, the country's Prime Minister Helle Thorning-Schmidt announced Wednesday.

Denmark's ruling government has signed an agreement with the Liberal Party, the Socialist People's Party and the Conservative People's Party that the Danes will vote in a referendum to replace its opt-out from the EU's justice rules with an opt-in, Helle Thorning-Schmidt told a press conference.

"Our wish is that the Danes have the opportunity to decide whether we need to replace our legal reservations with an opt-in model in the future, so we can continue to participate in the EU police cooperation," Xinhua quoted Thorning-Schmidt as saying.

Denmark holds a number of opt-outs from EU policies, including joint defence, judiciary cooperation, European citizenship and the adoption of the euro.

The opt-out on cooperating with EU legal affairs could force Denmark to leave the European cross-border crime agency Europol.

According to Europol, its 800 staff who cooperate with all 28 EU national police forces are involved in around 18,000 cross-border investigations every year.

"The fight against transnational crime requires close international cooperation, and Europol has developed into a central and effective cooperation body for the Danish police. Therefore, it would be a serious problem for all residents' safety and security, if Denmark has to leave Europol," the prime minister said.

Denmark will remain outside of a common European refugee and asylum policy, according to Thorning-Schmidt.