Slovenian President Borut Pahor lashed out at Croatia saying it was breaching the terms of its accession to the European Union by refusing to recognise the June ruling by the Permanent Court of Arbitration in The Hague, which allocated Ljubljana more than two-thirds of picturesque Piran Bay.
European Commission chief Jean-Claude Juncker said the bloc was ready to step in to help resolve the dispute, which has raged since the break-up of Yugoslavia 25 years ago.
"We would like to try to mediate between the two sides -- on the basis of the decision of the Court of Arbitration of course," Juncker said after talks with Pahor in Brussels.
"The differences between the two sides are tiny -- tiny!" he added.
Slovenia formally took over its part of the bay on December 30, and reported that three Croatian fishing boats entered its waters accompanied by Croatian police patrol boats.
The fishermen were told to leave and had their details taken, while Croatian authorities said the boats were simply retrieving fishing nets laid the night before.
Juncker insisted the Piran Bay row was "not a big problem" and not something that would worry other EU leaders.
But he warned that other Balkan countries hoping to join the EU would have to solve their border disputes before doing so.