Brussels - The European Union gave a guarded response Thursday to the decision by Turkey's constitutional court not to ban the ruling AKP party, saying that it would keep a close eye on future developments.

The 27-member bloc, which Turkey's current government is keen to join, "takes due note" of the court decision and "invites all those involved in Turkish politics to resolve their differences in a spirit of dialogue and compromise, while respecting the rule of law and fundamental freedoms," a statement on behalf of the bloc said.

"The EU, which is attentive to the democratic functioning of institutions, will continue to watch the situation in Turkey carefully," the statement from the French government, which currently holds the EU's rotating presidency, added.

Prosecutors had demanded that the court close down the AKP, a party with a strong Muslim identity, on the grounds that it had allegedly tried to undermine Turkey's strictly secular constitution.

But on Wednesday the court rejected that call, instead fining the party half its annual state subsidy as a "warning."

Turkey is a candidate for EU membership, but its accession is opposed by a number of key current members, notably France.

Critics of Turkey's EU bid say that the judiciary and the army in the country both play an unacceptable role in its political life. The case against the AKP was seen in some quarters as a litmus test of Turkey's democratic standards. (dpa)