0129 GMT October 22, 2017
"There is no mediation possible between democratic law and disobedience, illegality," he told the Spanish parliament on Wednesday.
The comments were a direct response to Catalan leader Carles Puigdemont, who signed a declaration of independence on Tuesday but said it was put on hold in the hope that Madrid would come to the negotiation table.
Rajoy dismissed the plan as a “fairy tale” and said it was neither “peaceful” nor “free.”
“It will not be recognized by Europe and now everyone knows it will have costs," he added, referring to a number of multinational companies and financial firms that have already left the region to stay safe from the consequences of a possible turmoil.
Puigdemont has repeatedly called on Madrid for mediation since holding an independence referendum on October 1, which was attended by some 2.26 million of Catalonia’s 5.3 million registered voters and saw over 90 percent of them vote in favor of secession.
Earlier on Wednesday, he proposed the two sides should introduce a mediator as a first step to settle the crisis.
"Maybe, it could help (us) to talk if two people representing the Spanish government and two people representing the Catalan government just simply agree on one thing, for instance, naming a mediator," he said.
Spain issues ultimatum
Meanwhile, Rajoy made the best of Catalonia’s ambiguous stance on independence and said the central government had agreed to require Puigdemont to clarify his plans so that Madrid could explore its options under Article 155 of the constitution.
The Spanish news agency EFE reported Wednesday that Catalans had only until October 16 to decide.
If Puigdemont confirms the declaration, he would be given an additional three days to rectify it, the report added.
Otherwise, the central government could trigger Article 155, which allows it to suspend the regional administration and take direct control of Catalonia.