GENEVA – A World Trade Organization appeals organ on Wednesday ruled against U.S. labeling rules that keep tuna caught by Mexican fishing fleets from benefiting from “dolphin-safe” labels, finding that those restrictions impede Mexican producers’ ability to compete on a level playing field.

Its ruling reversed key findings of a WTO panel that in a report issued last year had found that the dolphin-friendly label did not violate the principles of the WTO Agreement on Technical Barriers to Trade.

That panel had concluded that Mexican tuna did not receive – based on country of origin – less favorable treatment than tuna caught in U.S. waters or waters of other countries using methods that met high U.S. dolphin-safe standards.

But the WTO Appellate Body said in its report circulated Wednesday that “by excluding most Mexican tuna products from access to the dolphin-safe label while granting access to most U.S. tuna products and tuna products from other countries, the measure modifies the conditions of competition in the U.S. market to the detriment of Mexican tuna products,” the WTO’s Appellate Body said.