FILE - In this Aug. 27, 2016 file photo, activists of the Identitarian Movement protest on the Brandenburg Gate in Berlin, Germany, with a banner reading 'secure borders - secure future'. The German domestic intelligence agency says it is stepping up observation of the far-right Identitarian Movement in Germany that campaigns against immigrants and Islam. (AP Photo/Frank Jordans)

BERLIN (AP) — The German domestic intelligence agency said Thursday it is stepping up observation of the far-right Identitarian Movement in Germany, a group that campaigns against immigrants and Islam.

The agency, known by its German acronym BfV, said it has concluded after two years of investigation that the Identitarian Movement has "passed beyond the stage of suspicion" and "is now classified as a verified extreme right movement."

In a statement, the agency said the group "ultimately aims to exclude people of non-European origin from democratic participation and to discriminate against them in a way that infringes upon their human dignity."

The decision comes amid fresh fears about far-right extremism in Germany following the arrest last month of a man with a long history of neo-Nazi activity over the killing of a regional politician from Chancellor Angela Merkel's party.

Originally started in France, the Identitarian Movement's German offshoot was founded in 2012 and there are sister organizations in other European countries. It strives for a clean-cut image quite different from that of Germany's traditional far-right groups, though the Identiarians' flags are seen at rallies alongside skinheads and marchers with Nazi tattoos.

It is best known for publicity stunts such as draping banners from public buildings and disrupting lectures or theater performances.

The group said Thursday it eschews violence and branded the domestic intelligence agency's decision as "politically motivated."

But BfV chief Thomas Haldenwang accused the group of "intellectual arson," saying "there mustn't be any tolerance of extremists."

The leader of the Identitarian Movement in Austria, Martin Sellner, recently came under scrutiny after it emerged he had received a donation from the New Zealand mosque attacker. Sellner, who is engaged to American alt-right activist Brittany Pettibone, has acknowledged exchanging emails with the gunman but denies involvement in the attack.

In Germany, the group has ties to the far-right Alternative for Germany party, parts of which are also under surveillance by the BfV for suspected extremist tendencies.

The new classification assessment gives the BfV additional powers of surveillance against the group, which is estimated to have about 600 members.

The announcement comes exactly one year after the verdict in Germany's highest-profile neo-Nazi murder trial. Beate Zschaepe, the only known survivor of the National Socialist Underground group, was sentenced to life in prison for her role in the killings of 10 people — most of them migrants — who were gunned down between 2000 and 2007.

While four others were also convicted of supporting the group in various ways, anti-racism campaigners say authorities — including the BfV — never fully investigated the wider network that Zschaepe and two deceased co-conspirators must have relied on during more than a decade on the run.

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Activists of the Identitarian Movement protest on the Brandenburg Gate with a banner reading 'secure borders - secure fututre'Saturday, Aug. 27, 2016.The German domestic intelligence agency says it is stepping up observation of the far-right Identitarian Movement in Germany that campaigns against immigrants and Islam. (AP Photo/Frank Jordans)