(GENEVA) - The World Trade Organisation on Wednesday rejected an appeal by the European Union against a WTO condemnation of its banana import policies following a complaint by the United States and Ecuador.

The ruling by the WTO's appeal body upheld an earlier decision that "the EC bananas import regime, in particular, its duty-free tariff quota reserved for ACP (African-Caribbean-Pacific) countries, was inconsistent" with global trade rules.

Banana imports from mostly poor former European colonies in Africa, the Caribbean and the Pacific region enter the EU tariff-free.

Latin American exporters, which currently are subject to taxes of 176 euros per tonne, have been pushing for this trade barrier to be lowered.

Although the United States does not export bananas to the EU itself, three of the largest producers with plantations in Latin America are US-based multinationals -- Chiquita, Del Monte and Dole.

Eager to put an end to the decades old dispute, the EU had offered to lower its tariffs on Latin American bananas on the sidelines of the WTO negotiations in July.

The various sides came close to signing a settlement in Geneva but the deal fell through as the overall WTO negotiations on global trade liberalisation collapsed.

"It is time for the EU to do the right thing and implement a tariff-only regime for bananas that meets the interests of all parties involved," US Trade Representative Susan Schwab said in Washington.

Ecuador welcomed the ruling and said it had appealed to the EU "to respect the agreement and to put an end to this long dispute that has irritated the global relations" between Quito and Brussels.

The Ecuadorean mission said in a statement that the EU "holds the key for the solution to this long dispute."

For its part, the EU said it accepted the ruling but that the best means of resolving the dispute was in the context of the WTO's overall Doha Round of negotiations aimed at liberalising global commerce.

"The EU considers the Doha Round to be the right forum to find a resolution, and we are ready to take up the negotiations on a deal on bananas with all suppliers where they were left in July," said EU Commission spokesman Peter Power in a statement.

The WTO's ministerial summit in July ended in failure over a dispute between India and the United States on measures to help poor farmers.

But there are increasing signs ministers may meet again in Geneva next month in yet another last-ditch attempt to secure a deal.

The Doha round was launched with great fanfare in 2001 as a means of freeing up global trade and lifting developing countries out of poverty but negotiators have consistently failed to meet deadlines and overcome differences on agricultural subsidies and industrial tariffs.

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