EU suffers defeat in banana wars

The WTO case was brought by Ecuador, which, along with other Latin American countries, claims the EU favours Caribbean and African producers.

The EU said it was considering appealing against the ruling.

The ruling is the latest in a series of WTO decisions against the EU's banana regime - the longest running dispute in WTO history.

If the ruling is upheld, Ecuador will be able to impose trade sanctions on the EU.

'Big victory'

"It's a big victory for us," said Cesar Montano Huerta, from Ecuador's WTO mission.

"But we are still hoping to come out with a solution and negotiations for this issue."

Ecuador, the world's biggest banana exporter, first brought the case in 1996 with Guatemala, Honduras, Mexico and the US.

Colombia, Nicaragua and Panama have also joined the dispute.

The US does not export bananas to the EU but three large US-based multinationals, including Chiquita, have plantations in the region.