Slovenia's Agriculture Minister Dejan Zidan reacted sharply on Wednesday following unofficial announcements that the European Commission (EC) may soon recommend a compromise solution to the dispute over Teran wine which has marred otherwise good cooperation between Slovenia and Croatia in agriculture.

"If that is true all of Slovenia will be disappointed because Croatia is violating European rules with its Teran wine and we are defending them. If that happens, the EU's reputation will fall in Slovenia," Zidan told Slovenian Radio, adding that Slovenia might sue the EC and that this was the opinion of the entire political leadership in the country.

Zidan said that he planned to meet with European Commissioner for Agriculture and Rural Development Phil Hogan and other European colleagues to defend Slovenia's interests and Slovenia's Teran wine from the Kras region.

"I will be very disappointed if an exception is made to allow Croatia to use that protected trademark and we will use all legal means to protect Slovenian producers," Zidan told the Slovenian STA news agency.

Citing unnamed sources in Brussels, Slovenian media said on Wednesday that the EC had requested Croatia to temporarily put a new bill on hold which would allow Croatia to label wine showing the sort of grape used to produce it. Brussels is unhappy that Ljubljana and Zagreb have failed for two years to find a solution to the dispute and that the EC will launch proceedings for a compromise decision.

The proposal would allow Croatia to label its Teran wine - "Hrvatska Istra" and "Teran" in smaller font to distinguish it from Slovenia's Refosk wine and Croatia's Teran wine which originates from Istria.

Slovenia has not agreed to such a proposal and has asked that Croatia be banned from selling Teran wine in the European Union but also on the Croatian market.