LONDON (REUTERS).- A major London exhibition of treasures from the Prince of Liechtenstein's collection has been canceled because of a dispute over the export of one of the prince's paintings.

The show was billed as one of the highlights of the 2010 season at the Royal Academy, and the prestigious gallery is now working on alternatives to fill its main galleries between September and December next year.

"After many months of planning ... we are of course very disappointed that the Prince of Liechtenstein has decided to cancel the exhibition," a spokesman for the gallery said.

"This is owing to an unrelated criminal inquiry into the export of a group of pictures bought in London by the Prince over three years ago.

"The Royal Academy has a number of projects in development and is considering alternatives for next autumn which we will present early in 2010."

The dispute centres around Spanish Renaissance painting "The Infante Don Diego" by Sanchez Coello which was purchased by the prince from a British owner via a London dealer in 2006.

In 2007 the British authorities deferred a license to export the work, unofficially valued at around two million pounds ($3.3 million), in order to allow time for an alternative buyer to raise the necessary funds to keep it in the country.

The authorities later launched an investigation into the license applications for the group of paintings that included the Coello and their valuations.

According to HM Revenue & Customs, which is handling the case, the painting has been returned to the prince's representatives but is still barred from export.

Johann Kraftner, director of the Collections of the Prince of Liechtenstein, told Reuters that neither the prince nor the collection were in any way involved in the investigation.

"We have not had any information," he said by telephone.

According to Kraftner, the only way the show could be staged as planned was for the prince to accept a British government indemnity to protect his loans, since commercial insurance would be too expensive for the Royal Academy to afford.

"We have been asked to accept the British state indemnity," he said. "But to accept state indemnity you have to trust the state, and if you are not informed by the state we had to say we cannot send our treasures.

"We worked up to the last moment. We felt very badly treated."

He said the exhibition, to have included works by Flemish master Peter Paul Rubens among others, would have been more spectacular than a 1985/6 show of the prince's collection held in New York.

Another Royal Academy "blockbuster," "From Russia," opened in 2008 despite a row over the ownership of priceless treasures that had threatened to derail it.

Government assurances that Russia would not lose disputed paintings by the likes of Van Gogh and Cezanne helped save the exhibition.

(Editing by Paul Casciato)