The European Union's original decision to ban such imports angered Canada and prompted a legal challenge by Inuit groups from Canada and Greenland.
The EU's Court of Justice temporarily suspended the ban in August of this year, accepting a request by Inuit companies that export seal products.
But, a judicial panel has now ruled that there was no legal basis to make the moratorium permanent because the plaintiffs had not proven that they had incurred financial damages due to the ban.
“This is a real milestone for animal welfare,” said Adrian Hiel of the International Fund for Animal Welfare (IFAW), an environmental lobby group in Brussels.
But Canadian Prime Minister Stephen Harper has described the ban as “completely unfair” and as “flagrant discrimination” against sealers who follow established rules of animal husbandry.
EU member states and the European Parliament decided last year to restrict trade in seal products, heeding environmental arguments that commercial seal hunting was cruel.
The EU measure has been challenged separately by the Canadian and Norwegian governments through formal complaints to the World Trade Organization, and those cases are still pending.
Canada's 6,000 seal hunters earn about seven million euros ($9.8 million), annually, with a quarter of their hunt exported to Europe.
Author: Gregg Benzow (dpa, AFP)
Editor: Chuck Penfold