President George W. Bush's tactics in the war on terrorism suffered a major blow Thursday when the US Supreme Court struck down as illegal the military tribunal system set up to try Guantanamo prisoners.

In a 5-3 vote, the high court warned the administration had no "blank check" to decide how to try terror suspects, as it reversed an appeals court ruling on a tribunal for Osama bin Laden's former driver Salim Ahmed Hamdan.

The case had centered on an appeal brought by the 36-year-old Yemeni who was captured in Afghanistan in November 2001, over the constitutionality of the tribunals.

The Cuba-based facility currently holds come 460 inmates -- mostly without charge -- whom the US suspects of links to al-Qaeda or the Taleban.

Germany insists on closure

The outcome was welcomed in Europe, with German politicians seeing the ruling as a further confirmation that closure of the camp is the best -- and only -- option.

"The best thing now would be to shut down Guantanamo," said the SPD's foreign policy spokesman Gert Weisskirchen in an interview with the Berliner Zeitung newspaper. "The ruling eliminates one of the basic justification for the camp's existence."

"The judgement renews our faith in the US legal system," said his FDP counterpart Werner Hoyer, while Volker Beck from the Green party described it as a "humiliation" for the Bush administration and a blow to its strategy of "suspending US law with tribunals on foreign soil."

"The only acceptable consequence is to shut Guantanamo for good and free the inmates," he said.

"(Guantanamo) is a historic mistake and a legal irregularity," said Sabine Leuthuesser-Schnarrenberger from the FDP. "It is unlawful and a clear breach of human rights."

A violation of law

In its ruling, the Supreme Court said the military tribunals contravened both the Geneva Convention on the treatment of prisoners and the US code of military justice, stressing that Guantanamo prisoners should be tried under established rules giving defendants greater protections, such as the right to be present during proceedings.

It rejected administration claims that Congress had authorized them by granting Bush sweeping war powers after the September 11 attacks, also rejecting the administration argument the Geneva Conventions do not apply to tribunals of suspected al-Qaeda and Taleban detainees as they are not prisoners of war but "enemy combatants."

"Whether or not the government has charged Hamdan with an offence against the law of war, cognizable by a military commission, the commission lacks power to proceed," the court said in the majority opinion.

White House digs in heels

But the White House and other administration officials quickly signaled they would try to consult with Congress to refine rules for such commissions, in line with the landmark Supreme Court judgment.

US President George Bush indicated that he would not rule out using military tribunals to try inmates at the Guantanamo Bay detention center and said he will consult lawmakers to seek the necessary authority.

"To the extent that there is latitude to work with the Congress to determine whether or not the military tribunals will be an avenue with which to give people their day in court, we will do so," said Bush. "The American people need to know that this ruling, as I understand it, won't cause killers to be put out on the street."

The idea that Bush could ask Congress to approve a remodeled tribunal set-up was first brought up by Supreme Court justices themselves, in a concurring document to the court's main opinion written by Justice John Paul Stevens.

"Nothing prevents the President from returning to Congress to seek the authority he believes necessary," wrote Justices Breyer, Kennedy, Souter and Ginsburg.

A senior official later Thursday argued that the court had "emphasized these problems can be cured and invited the president and Congress to do just that."

What it means for Guantanamo

The decision isn't expected to affect operations at Guantanamo. The camp's commander pointed out the court was asked only to rule on the legality of military tribunals, not the prison itself.

They also stressed the decision did not mean Guantanamo would quickly shut down.

"Nobody gets a 'get out of jail free,' card," said White House spokesman Tony Snow.

The first tribunals were set up June, 2004. Officials said Thursday that between 40 and 80 Guantanamo detainees were considered eligible for war crimes trials. Only 14 have been publicly identified and of those only 10 have been charged, including Hamdan.

"A high water point in American history"

Conservative Justice Clarence Thomas warned in a dissent that the majority ruling meant that terrorists needed to be caught "red handed" before they could be tried under the laws of war.

"It would sorely hamper the President's ability to confront and defeat a deadly enemy," he wrote.

The ruling also rejected administration arguments that a new US law passed last year stripped the jurisdiction of federal courts over Guantanamo cases.

Hamdan's attorney, Lieutenant Commander Charles Swift, said the ruling meant his client would now get a fair trial.

"It's a return to our fundamental values, and that return marks a high water point in America history," Swift told reporters.