Morocco suspended links with Brussels early this year after the General Court of the EU, the bloc's second highest court, annulled the deal on the grounds that it illegally applied to the Western Sahara, which faces an independence fight from the Front Polisario.
But in its verdict, the EU Court of Justice said it "dismisses the action for annulment brought by the Front Polisario against the Council's decision to conclude the Liberalisation Agreement."
The European Council, which groups the 28 member states, appears set to go ahead to reinstate the trade agreement, though the court did not explicitly say so.
The Polisario Front, a group which seeks independence for the Western Sahara, had challenged the 2012 trade deal. The EU in turn appealed against the decision to overturn the pact.
Western Sahara is a former Spanish colony now controlled by Morocco.
The top court ruled: "Having concluded that the Liberalisation Agreement does not apply to the territory of Western Sahara, the Court sets aside the judgment of the General Court."
Source: AFP
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