Croatia's talks on joining the EU have been suspended, splitting the 25 member states and jeopardising Turkey's ambitions to join the union.
A majority of countries, led by Britain and the Netherlands, argued that Zagreb should not be allowed to start negotiations on membership because of its failure to help track down a former general wanted on war crimes charges.
But a group of countries including Austria, Hungary, Slovenia and Slovakia - most of whom were part of the old Habsburg Empire - supported the immediate start of talks. They kept open the possibility that membership negotiations with Ankara, which are due to start in October, could be frozen too if Croatia is not at the negotiating table by then.
The division has deep historic echoes, with the central European nations more sympathetic to Croatia than the northern nations. The dispute also poses a potentially explosive problem for Britain which takes over the presidency of the EU in the second half of this year.
Asked directly if Austria would be willing to block Turkey's accession talks in October, Austria's Foreign Minister, Ursula Plassnik, replied: "I won't answer on that. The topic is Croatia right now." Slovenia's Foreign Minister, Dimitrij Rupel, said the precedent set by yesterday's decision was that "conditions for EU enlargement are getting tougher". That implies that there will be little leniency if Turkey fails to meet any of the conditions asked of it if it does start talks in October.
Croatia's hopes of starting membership talks immediately foundered on the decision of the EU to make full co-operation with the UN tribunal investigating war crimes in the former Yugoslavia a precondition of negotiations.
British, Dutch, and German diplomats have argued that, if Croatia is allowed to open EU membership talks without the surrender of General Ante Gotovina, that could make it impossible to secure the handover of the two most wanted war criminals in the Balkans. They are the former Bosnian Serb leader, Radovan Karadzic and his military commander Ratko Mladic. "If we want Serbia to come into line, then our position towards Croatia has to be very clear, otherwise we also lose our leverage vis-a-vis Serbia," said the Belgian Foreign Minister Karel de Gucht.
But the Foreign Secretary, Jack Straw, took a conciliatory tone and suggested that a compromise may be possible in June. Mr Straw argued, for the first time, that, while more cooperation with the UN tribunal was essential, "none of us are making [the surrender of General Gotovina] a precondition".
He added that, were full co-operation given but "that co-operation was unsuccessful in the arrest of the fugitive, the government concerned should not be penalised for matters beyond its control".
Carla Del Ponte, the UN's chief war crimes prosecutor, is due to deliver another assessment of Croatia's co-operation in June to the UN Security Council, Mr Straw pointed out. That gives Zagreb more than two months to prove it is doing everything possible to track down the former general who is accused of responsibility for massacres of Serbs in Krajina in the 1990s.
The Croatian premier, Ivo Sanader, said his country had met obligations to co-operate with The Hague.
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