THE HAGUE (AFP) - Dutch authorities closed down a notorious Amsterdam hookah bar on Wednesday after a severed human head was discovered at its entrance, a grisly find believed to be linked to a drug war between rival gangs.

A passer-by signalled the gruesome scene to police, who linked it to the discovery of a decapitated body in a burnt-out car elsewhere in the city.

Police said the body belonged to 23-year-old Amsterdam resident Nabil Amzieb, who was known to the authorities.

"A police probe later confirmed the head belonged to the body," they said in a statement.

The hookah bar called the Fayrouz Lounge is a "well-known gathering spot for criminals involved in the so-called "Mocro-war", a power struggle mainly between Moroccan gangs in the city, public broadcaster NOS said.

It most likely represented a "new phase" in the gang war, which has seen several others murdered in the scenic Dutch capital, including one man who was killed after visiting the same bar, Dutch media reports said.