The 24th annual Anglo-French summit in London has seen leaders from both countries reject extending the "war on terrorism" to Iraq.

Tony Blair and French president Jacques Chirac agreed that action against the "rogue state" should only be taken if there was evidence of a clear link between Saddam Hussein's regime and the September 11 terror attacks.

But both governments said they continued to support the offensive against the Taliban in Afghanistan.

"The UK and France reiterate they stand shoulder to shoulder with the US and the American people in the fight against terrorism. This is a cause we share with all democratic countries. We will continue to sustain the fight against terrorism so that the outrage of September 11 is never repeated," said a summit statement.

Bigger role for EU army?

Blair, Chirac and French prime minister Lionel Jospin also considered the future direction of the EU, with enhanced cooperation on defence issues high on the agenda.

A French spokesman, Catherine Colonna, said both countries would continue "to mark their engagement in favour of the construction" of a more unified approach.

And Paris sources have indicated that Blair and Chirac are working on joint declaration on European defence as an integral part of the "future of the EU" debate at the Laeken summit on December 14.

The developments came amid reports that the role of the EU rapid reaction force could be extended beyond crisis management and peace keeping operations.

The Belgian prime minister and acting president of the European council, Guy Verhofstadt, told the EUobserver.com website that an emerging consensus backed extending defence EU competences, as well as closer cooperation in other areas such as justice and home affairs.

"In all discussions I held, in the Franco-German declaration, in the speech of Tony Blair, and also in the resolution of the European parliament, yesterday, there has been the same demand, concerning the necessary extension of the European policy on defence, security, foreign policy, police, justice, asylum, immigration, fight against terrorism and organised crime.

"I believe the idea has made its way step by step, and the 11 of September attacks were the element that accelerated that. I do not exaggerate when I say there is a consensus on that point," said Verhofstadt.