The setback for the EU is the second time in seven years that the WTO has found against its banana imports regime after a ruling against a previous system in 2001.
Ecuador lodged a complaint in November 2006 challenging new rules implemented on January 1, 2006 that imposed custom duties of $260 per tonne on bananas from countries outside the ACP group.

Bananas from South America account for four fifths of EU imports, with the remainder coming from African, Caribbean and Pacific nations.

The ACP bananas currently enter the EU duty free under a quota of 750,000 tonnes a year, with the system devised to favour the ACP countries, many of which are former European colonies.

Under previous practices, bananas from South America and non-ACP countries were subject to a tariff of $117 a tonne under a certain quota level and $1,067 a tonne above that level.

The system was redrawn after the WTO upheld a complaint by Ecuador, Guatemala, Honduras, Mexico and the United States in 2001.

In February, the WTO also ruled against the EU in a similar case brought by the United States.

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