Two nephews of Venezuela's first lady are facing arraignment in New York after being arrested in Haiti on charges of conspiring to smuggle 800 kilograms of cocaine into the United States, people familiar with the case said.

The arrest of Efrain Campos and Francisco Flores is likely to exacerbate already tense relations between the US and Venezuela.

The case also comes just three weeks before key legislative elections that opinion polls have been suggesting could hand the ruling party its worst defeat in 16 years as Venezuela's struggles with triple-digit inflation and widespread shortages of basic goods.