Turkey's highest court decided not to close down the ruling Justice and Development Party (AKP) owing to the government's steps to join the European Union, according to the court's reasonings published in Friday's Official Gazette.

The Constitutional Court in July issued the Islamic-rooted party with a severe warning for being "a focal point of anti-secular activities," but instead of banning the party, the court fined it half the amount it expected to receive in treasury aid.

According to the court's reasonings, Prime Minister Recep Tayyip Erdogan's statements concerning the wearing of Islamic-style headscarves were considered to harm secularism but that the government's steps to join the European Union and its extension of rights to ethnic and religious minorities were taken into consideration.

The court also noted that while the AKP government had taken steps that harmed secularism it had not promoted or used violence in its actions.

The AKP was formed out of the ashes of banned Islamist parties but its founders and current leaders insist it is a moderate conservative party, not a religious party.

The July decision not to close the party came as a relief to not just the AKP but also to the stock market, which feared that closing down the party could lead to turmoil as a decision to ban the party would almost certainly have led to early elections.

At elections in July last year, the AKP received 47 per cent of the vote, giving it a massive majority in parliament.